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SCO Responds to Novell's Objection With Some Very Tricky Dance Moves

By Pamela Jones et al.

SCO has responded to Novell's Objection to the proposed sale of most of SCO's assets. Novell's objection is irrelevant, SCO claims, because SCO doesn't intend to assume and assign the 1995 APA.

Novell argued that "It follows by the Debtors' own admission that to operate the Business as defined [by] the unXis APA, unXis (or any other buyer) needs access to the copyrighted material that the Debtors licensed from Novell. In other words, any buyer of the Business must have the Debtors assume and assign their Novell copyright licenses.... Finally, and of the utmost importance, Original APA Section 9.5(c) expressly prohibits its assignment by SCO without Novell's consent. "

Here's SCO's workaround. Instead of assuming the APA and assigning it, SCO says it will sell only what the court said it owns, UnixWare, and then it will *sublicense* the software business:

The Sublicense Agreement will grant to unXis a perpetual, non-exclusive, royalty-free right and sublicense to use the Licensed Properties consistent with the ordinary course manner in which the Debtors have done so historically.

Wait. What? Done so historically? Let's look at this claim a little more closely to see if it's true.

Full post as published by Groklaw on February 14, 2011 (boomark / email).