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SGI attorneys halt the invoices

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SCO is to suspend 'indefinitely' its demand that SGI pay it UNIX™ royalties. Perhaps more importantly for Linux users, it's not going to bill end users either. Businesses who run Linux don't have to worry about an invoice from SCO, or at least not yet. The Utah-based company had said it was looking for $699 up to $4,999 for servers and $199 for desktops. Now it's delaying sending out the invoices.

SCO claims to have found a couple of mugs who wanted pay the license fees without receiving an invoice. But as analyst Gordon Haff of Illuminata told IDG, billing end-users exposes SCO to counter-suits, at least in the litigious USA.

SCO's Blake Stowell recently took issue with IBM and SGI's defense that their licenses were 'irrevocable'.

Peter de Silva writes:

"But, Doctor Evil, 'irrevocable' doesn't mean 'it can't be revoked', it means 'it can't be revoked unilaterally and arbitrarily".

And Charles Duffy suggests SCO should take a closer look at its own contracts.

"Amendment 10 to the IBM contract, clearly states: 'Upon payment to SCO of the consideration in the subsection entitled "Consideration", IBM will have the irrevocable, fully paid-up, perpetual right to exercise all of its rights under the Related Agreements beginning January 1, 1996 at no additional royalty fee.'

"It also states: 'Notwithstanding the above, the irrevocable nature of the above rights will in no way be construed to limit Novell's or SCO's rights to enjoin or otherwise prohibit IBM from violating any and all of Novell's or SCO's rights under this Amendment No. X, the Related Agreements, or under general patent, copyright or trademark law."

"In short: SCO can get a court order to stop IBM from violating the agreement, but they can't revoke the agreement itself. I suggest Mr. Stowell try to answer his question (with regard to why anyone in their right mind would sign an irrevocable license) himself."

And the proof's here.

Andy Grove last week pointed to IP legislation as a sign of competitive decline in the United States. He didn't quite describe it as a sign of Imperial decadence, but he might as well have done.

However finance capitalists - who these terms set the tech agenda - can't get enough of it. The SCO Group has seen its share value rocket since embarking on its litigation campaign against Linux, and yesterday received $50 million in investment from BayStar Capital. That's enough to buy a 17.5 per cent stake in SCO for Baystar, which has invested in companies that exploit patent and other 'IP' properties, including Roxio and Digimarc. ®

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