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Novell to keep SuSE enterprise customers safe from SCO

Michael S. Mimoso, Senior News Editor

Novell Inc.'s announcement today that it would indemnify its SuSE Linux enterprise customers against any potential litigation from the SCO Group isn't likely to budge IBM from its position that it won't offer such protection.

Novell joins Hewlett-Packard Co. and JBoss Group, becoming another leading Linux vendor to offer protection from SCO. SCO has filed a multibillion-dollar suit against IBM and claims that IBM improperly donated code from System V Unix to the Linux kernel.

"IBM has offered the position that no indemnification is needed," said Dan Kusnetzky, an analyst with Framingham, Mass.-based International Data Corp. "If they did, I think SCO would be the first to say, 'See, we told you there was a problem.' I don't think Novell is supporting SCO's claims [by offering indemnification]. What they're saying is that, if there is merit to SCO's claims, their customers are protected."

Novell's Linux Indemnification Program is for its SuSE Linux Enterprise Server 8 customers who obtain upgrade protection and a qualifying technical support contract. Novell also announced today the completion of its $210 million acquisition of SuSE Linux AG, which is a leading Linux distributor.

Novell also said it would announce a program for current Linux users who are not SuSE customers.

Novell would protect its customers from copyright infringement litigation up to $1.5 million. The company also clarified what it described as unique contractual

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and intellectual property rights that it holds because of its position in the historical ownership chain of Unix and UnixWare. Those rights, Novell said, including the right to license Unix technology and authorize its customers to use it in their businesses.

SCO immediately responded to Novell's indemnification program.

"Indemnification programs or legal defense funds won't change the fact that SCO's intellectual property is being found in Linux. SCO is willing to enforce our copyright claims down to the end-user level and, in the coming days and weeks, we will make this evident in our actions," said SCO CEO Darl McBride in a statement. "We believe Novell's indemnification announcement is significant for a couple of reasons. By announcing the program, they are acknowledging the problems with Linux. Through the restrictions and the limitations on the program, they are showing their unwillingness to bet very much on their position."

HP also placed conditions on the indemnification of its customers, namely that new customers must agree not to make unauthorized changes to the Linux source code and must sign a support contract. Current HP customers who have not altered Linux and who have signed an amended contract are also indemnified.

A legal defense fund established by the Open Source Development Lab (OSDL) was announced this week as well, with $3 million in contributions from IBM and others padding the war chest. Fund organizers hope to amass $10 million in protection money. Red Hat Inc., the leading Linux distributor, has also established a defense fund for its customers.

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