SCO Admits &#39;Substantial Doubt&#39; of Survival
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With its cash reserves running out and its legal case against IBM Corp. unravelling, The SCO Group Inc. now says there is doubt that it will remain afloat.
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The SCO Group has been removed from the Nasdaq Stock Market because&#160;the company declared bankruptcy in September.The stock market delisted SCO and suspended trading of its shares (SCOX) at the beginning of trading on Thursday, SCO said in a filing to the U.S. Securities and Exchange Commission. Nasdaq had told the company in September that it would be delisted, and SCO&#39;s subsequent appeal of that determination was turned down.SCO has been waging an expensive legal battle against IBM for years, claiming the company inappropriately used copyrighted SCO Unix code as part of its support of the Linux operating system. SCO suffered a major loss in that case in August when&#160;a federal judge ruled that Novell, not SCO, owned the Unix copyright. In September, the Lindon, Utah, company said the ruling might cost it US$30 million and that it had just $10.4 million in cash.In October,&#160;SCO said it had a &quot;potential&quot; buyout offer for $36 million from JGD Management, a company affiliated with investment firm York Capital Management. That deal would have to be approved by the bankruptcy court.
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Ziff Davis - Revenue for the quarter of &#36;11.2 million, compared with &#36;20.1 million in the year-ago quarter, dropped in part because of dwindling SCOsource licensing revenue&#151;but SCO's CEO says the company is "steadfast on a dual path for success."
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(InfoWorld) - With its cash reserves running out, the SCO Group has filed for bankruptcy protection. The Lindon, Utah, company made the announcement in a news release issued Friday afternoon. "The Board of Directors of The SCO Group unanimously determined that Chapter 11 reorganization is in the best long-term interest of SCO and its subsidiaries as well as its customers, shareholders, and employees," the statement said. SCO expects to "maintain all normal business operations throughout the bankruptcy proceedings." Once a respected vendor of the Unix operating system, SCO is now best known as the plaintiff inÂ a long-running lawsuit against IBMÂ related to the computer giant's support of the Linux operating system. SCO has claimed that IBM inappropriately contributed to the development of Linux, but SCO's critics say that the lawsuit was simply a desperate attempt to reach a financial settlement from IBM, which has invested heavily in Linux over the years. The lawsuit had proved to be a costly one. SCO has been losing money for years as it has racked up millions of dollars in legal fees and seen its core Unix software business decline. Last month, it suffered a major legal setback asÂ a federal judge ruled that Novell, not SCO, owns the Unix copyright and that SCO would have to pay Novell for past licensing deals it had struck with Sun and Microsoft. The case is due back in court on Monday, when a judge is to begin evaluating how much SCO has to pay Novell. It was unclear Friday how the Chapter 11 filing might affect Monday's proceeding. SCO's stock has been hammered since March of 2003, when it first filed suit against IBM. On Friday it closed at $0.37, down 43 percent on the bankruptcy news. Â
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Richard Mathias writes &quot;Following on from the posting a month ago, where SCO said it was going to launch a new website to counteract Groklaw and give its side of things - well, now the company looks like it&#39;s given up on the whole plan.
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The SCO Group Inc. is reconsidering its plans to launch an alternative to the Groklaw.net Web site that had been scheduled to go live this week, a company spokeswoman said Monday.
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SCO Group's faltering attack on Linux faces another threat as Big Blue files motion seeking dismissal of contract claims.
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IBM attorneys argued that Utah-based SCO Group has failed to provide any evidence that IBM allowed proprietary Unix code to enter the freely distributed Linux operating system and its &#36;5 billion suit making that claim should be dismissed.
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$1.20 to go SCO Group shares went south in a hurry during Friday's trading, as investors reacted to the company's legal misfortunes.â¦
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Software maker SCO Group has been targeted by hackers once again. This time, the company&#39;s Web site was defaced. The attacks began during the long holiday weekend and were first noticed
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In the 17 months SCO Group has waged its multiple-lawsuit war over its alleged rights to Linux, Groklaw has been the festering thorn in the Utah software company&#39;s side.
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Stock fails HA test too The poor SCO Group can't get much right these days, including keeping its high availability clusters highly available.â¦
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Patent lawyers' benevolent fund 86'd in ticker bicker Battered unix patent warrior SCO has been booted from the Nasdaq after it lost an appeal against delisiting by the New York technology market.â¦
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Ziff Davis - Opinion: All SCO got was the right to look through an insanely large amount of IBM code on what may be the world's largest code-fishing expedition.
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(InfoWorld) - With its cash reserves running out and its legal case against IBM unravelling, The SCO Group now says there is doubt that it will remain afloat. SCO made the statement in its most recent quarterly U.S. Securities and Exchange Commission statement, filed Tuesday. The company citedÂ its recent motion for Chapter 11 bankruptcy protectionÂ as well as a recent court setback relating to its intellectual-property claims as reasons for worry. "As a result of both the Court's August 10, 2007 ruling and the Company's entry into Chapter 11, there is substantial doubt about the Company's ability to continue as a growing concern," SCO said in the filing. Last month a judge with the U.S. District Court for the District of UtahÂ ruled against SCO on several motions, finding that Novell, rather than SCO, owned the Unix copyright. Novell had sold SCO some Unix rights in the mid-1990s, but the court said that copyright was never assigned. "The effect of these rulings was to significantly reduce or to eliminate certain of the Company's claims in both the Novell and IBM cases, and possibly others," SCO said in its SEC filing. Several of the company's claims against IBM will be dismissed as a result of this ruling, SCO said in the filing, adding that there are still certain claims that remain viable, such as SCO's allegation that IBM engaged in unfair competition in its failed "Project Monterey" effort that was to create a Unix for 64-bit microprocessors. The rulings may also cost SCO a lot of money. The court said that SCO would have to pay Novell for past licensing deals it had struck with Sun Microsystems Inc. and Microsoft. This could amount more than $30 million, SCO said in its SEC filing. That's more than the $10.4 million in cash now held by SCO. The rest of the 10-Q statement, which covers the quarter ended July 31, is a litany of bad news. SCO's total revenue has dropped drastically year-over-year, its Unix business is down 37 percent, it made nothing from its SCOsource Linux licensing program, short-sellers may further drive the stock down, and the bankruptcy proceedings will divert a "significant amount" of senior management's time away from business operations, the filing said. SCO did not immediately return calls seeking comment. The company's detractors were not so quiet. The filings show that by declaring bankruptcy, SCO is hoping to stave off paying Novell the money it owes, said Pamela Jones, editor of the Groklaw.net blog, which has closely followed SCO's litigation. "They are, to my eyes, saying they don't want to hand over the Sun and Microsoft 2003 monies because it would put them out of business," she said.
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Malicious hackers have compromised The SCO Group&#39;s Web page twice in as many days, posting messages that appear to mock the company&#39;s claims to own parts of the Linux operating system.
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After losing a court ruling to Novell and then seeking Chapter 11 bankruptcy protection, The SCO Group said that there is "substantial doubt" about its ability to continue as a viable business.