IBM to SCO: Our Unix licence is irrevocable

Hogwash, says SCO

IBM has poured scorn on a SCO Group threat to cancel Big Blue's licence to ship Unix products starting on June 13, saying that its contracts guarantee rights to the operating system. "We've reviewed our contracts, and our Unix licence is irrevocable and perpetual," Mike Fay, vice president of communications for IBM's systems group, said in an interview on Monday. "We're completely committed to AIX and will continue to ship it." SCO disagrees strongly with IBM's position. "That's hogwash," said Chris Sontag, senior vice president of operating systems at SCO and head of the company's SCOsource effort to make more money from its intellectual property. Sontag pointed to contract language that specifies terms under which IBM's licence may be revoked. SCO, inheritor of many of the rights to the Unix operating system initially developed by AT&T, filed a billion-dollar lawsuit on Thursday alleging IBM violated its trade secrets by implementing ideas from Unix in the open source Linux operating system. The suit, run by high-profile attorney David Boies, also alleges that IBM breached its contracts with SCO that allow it to sell its version of Unix, called AIX. Among claims in SCO's lawsuit is the allegation that "IBM is affirmatively taking steps to destroy all value of Unix by improperly extracting and using the confidential and proprietary information it acquired from Unix and dumping that information into the open source community," the suit said. "IBM's tortious conduct was also intentionally and maliciously designed to destroy plaintiff's business livelihood and all opportunities of plaintiff to derive value from the Unix software code in the marketplace." SCO also claims IBM induced some SCO customers to breach their own contracts with SCO. IBM hasn't yet responded in court, but the computing colossus has begun criticising SCO's claims. One key part of the dispute hinges on language in "Amendment X," a 1996 modification of the original Unix contract IBM signed with AT&T in 1985. Amendment X grants IBM "irrevocable" and "perpetual" rights to Unix. However, Sontag pointed to the next sentence in the agreement, which reads, "Notwithstanding the above, the irrevocable nature of the above rights will in no way be construed to limit... SCO's rights to enjoin or otherwise prohibit IBM from violating... SCO's rights under this amendment." Rich Gray, a Silicon Valley intellectual property attorney, said it's not unusual for licence agreements to employ apparently contradictory terms about whether a licence is perpetual and irrevocable. "There could be provisions in the agreement that say the licence is terminated upon the happening of certain events," Gray said. In other words, "the licence is perpetual so long as the licence agreement itself stays in force." If IBM chooses to continue shipping Unix, SCO will go to court over the matter, Sontag said. Stephen Shankland writes for News.com