A US judge has blocked SCO's attempt to sell off part of its business in order to fund its ongoing litigation, and appointed a Chapter 11 trustee to oversee the company's next moves.

SCO was hoping to sell off some of its assets, in order to fund its court battle against IBM and Novell for claimed Linux licenses. For its part, SCO said it was glad not to be pushed into Chapter 7 - full liquidation of the firm.

SCO started its litigation in 2003 by claiming IBM had given its intellectual property away to Linux, a decision which has won it few friends in the open source world.

The judge said the trustee was needed because SCO's management had "bet the farm" on its varied lawsuits. Judge Kevin Gross said that if he had approved the sale SCO's sole business would be litigation. He said "A trustee will be in a better position to make that assessment without the personal and emotional investment of SCO's management,", according to The Salt Lake Tribune.

Support from Microsoft added to suspicions that the case was designed to put litigation-wary enterprises off using Linux.®

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