Customer Success Testimonial: Recovery is Everything

The undead entity formerly known as SCO but lately doing business as The TSG Group – if you can call bleeding away cash on legal fees a business – has filed a motion in a Delaware court to convert its Chapter 11 bankruptcy case to Chapter 7, Groklaw reports.

Under US law, Chapter 11 bankruptcy allows a company to restructure its business, in hopes that it will eventually emerge from bankruptcy protection and remain a going concern. SCO has had no such luck, having spent nearly every penny in its coffers on fruitless legal actions against Linux vendors and customers over the last decade.

Mind you, for SCO that wouldn't be saying much. It sold off what was left of its Unix software and services business to UnXis in January 2011 as part of its Chapter 11 restructuring. In its filing, SCO's bankruptcy trustee admits that without that source of income, the company has "no continuing business operations."

But hold on. There's still the little matter of SCO's ongoing lawsuits over "certain unfair competition and tortious interference claims" it has made against IBM. According to SCO's filing:

The Chapter 11 Trustee does not believe the Debtors will be able to propose or confirm a plan in these cases because the Debtors' estates are administratively insolvent and continue to incur administrative expenses. Nevertheless, the Chapter 11 Trustee believes that it is in the best interests of the Debtors' estates and its creditors to continue the prosecution of the District Court Action

In other words, SCO can't really say what might become of these court cases, and there isn't really any more money left to prosecute them, but it would like to keep them open anyway just in case, even though the rest of the company is about to be dissolved.

So it seems there may yet be the barest flutter of a heartbeat in SCO's bedraggled cadaver after all. Still, with the Chapter 7 filing, the bankruptcy court is ready to bring its hammer down on the stake. The reign of terror of the tech industry's Most Hated Company may finally have come to an end.

In a horror film, this would be the moment when they throw up a title card reading "The End" ... followed by three dots and a question mark. ®

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