Novell Sues SCO For $26 Million In Unix System V License FeesNovell Sues SCO For $26 Million In Unix System V License Fees

Novell delivered a roundhouse punch to SCO Group in their dispute over who owns the copyright to Unix. In court papers filed last week, Novell says SCO received nearly $26 million in Unix System V license fees from Microsoft and Sun Microsystems. But, contrary to its 1995 Asset Purchase Agreement with Novell, SCO has failed to pass the fees on to Novell.

Novell says the agreement states it's entitled to 100% of the fees, according to a motion for partial summary judgment or preliminary injunction filed by Novell lawyers in the U.S. District Court in Salt Lake City. At a minimum, Novell wants the court to impose a constructive trust to hold existing and future Unix V fees.

SCO is "hemorrhaging assets at an unsustainable rate," the motion asserts. If SCO isn't forced to set aside the license fees now, Novell may be irreparably harmed by never being able to recover them, it says.

SCO is using the license fees for its own purposes, Novell lawyers say, including filing suits against IBM and Novell and defending its claims in a declaratory judgment case initiated by Red Hat. SCO also has sued AutoZone and DaimlerChrysler for copyright infringement stemming from their use of Linux. The legal actions have raised concern among Linux users over whether they're putting their operations at risk by using Linux and have left Unix users confused over who owns the licensing rights and copyright to Unix. If Novell prevails on some aspect of its motion, SCO's ability to sustain the court cases is likely to diminish.

Novell isn't only asserting that the fees are owed but that SCO also refused to disclose their existence, despite repeated inquiries from Novell, until the current court action forced it to do so. "For almost three years, SCO hid these agreements," Novell says in its motion. It engaged in the "willful and malicious withholding of the relevant agreements while it dissipated the trust funds."

A spokesman for SCO says Novell's assertions "jump to incorrect conclusions." SCO will report fourth-quarter and 2006 results Jan. 17, he adds, declining to comment further.