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Re: Novell CEO: Miceosoft Could Still Sue Novell for IP

  • Subject: Re: Novell CEO: Miceosoft Could Still Sue Novell for IP
  • From: "Rex Ballard" <rex.ballard@xxxxxxxxx>
  • Date: 15 Feb 2007 11:43:44 -0800
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  • In-reply-to: <5787959.kHUjkcskMX@schestowitz.com>
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On Feb 15, 9:44 am, Roy Schestowitz <newsgro...@xxxxxxxxxxxxxxx>
wrote:
> Novell execs fend off uncertainty over Microsoft pact
>
> ,----[ Quote ]
> | "We did not sign a patent cross licensing agreement, what we agreed
> | to was not to sue any customers over patents," Hovsepian said, adding
> | there has been confusion and rhetoric over the intellectual property
> | aspect of the contract.
> |
> | The deal protects customers, but either company could still sue each
> | other tomorrow, he said.
> `----
> http://www.linuxworld.com.au/index.php/id;1069002953;fp;2;fpid;1

This actually makes sense.  In effect, it's insurance.  IF some ex-
microsoft employee tried to sneak some code into the Linux kernel,
Microsoft couldn't sue Novell's customers.  At this point, neither
company is actually stating that they have violated each other's
patents or copyrights.

Red Had has leveraged it's patents in a similar fashion.  They have
agreed not to enforce certain patents against customers, in exchange
for immunity for it's customers.  The assumption is that if there are
royalty disparities, that these will be settled by the principle
companies, not by going after end-users.

If you think about it, it's pretty much a silly contract.  The only
precedent was when Thomas Edison used to send thugs after film
producers who were making movies using his patents, but not paying him
royalties for the movies.  Even then, however, Edison's goons didn't
line up at the exit of the movie theaters and shake down the audience
as they were leaving.  In effect this is what SCO tried to do to Linux
users.

> Related:
> ,----[ Quote ]
> | Allison: Yes, that's true, actually. I mean I have had people
> | come up to me and essentially off the record admit that they had been
> | threatened by Microsoft and had got patent cross license and had
> | essentially taken out a license for Microsoft patents on the free
> | software that they were using, which they then cannot redistribute. I
> | think that would be the restriction. I would have to look quite
> | carefully. So, essentially that's not allowed. But they're
> | not telling anyone about it. They're completely doing it off the
> | record.

This is because it's ILLEGAL!  That is extortion pure and simple.  In
this case, Microsoft IS shaking down movie patrons as they leave the
theater.  If a company is making the transition to Linux, Microsoft
comes in and offers to sell them "Insurance", "Just in case", because
it would be terrible for you to have to spend millions of dollars
defending yourself from patent infringement or copyright infringement
lawsuits by Microsoft.

Microsoft knows that it's intellectual property rights have not been
violated. Furthermore, they know that if they were violated, it's not
the consumer's responsibility to account for the licenses.  Microsoft
even knows that it forfeits it's right to enforce a copyright if they
don't enforce it against the Linux development team as soon as the
violation is disclosed.

Worse, Microsoft knows that they ARE violating far more OSS
intellectual property rights, including copyrights, and have even
attempted to patent technology originally developed in OSS projects
(by not mentioned in the prior art section of the patents).

These "no enforcement" agreements prevent Novell from enforcing IP
violations against Microsoft's customers.  Ironically it would be
illegal if they tried.

The dangerous part of SCO's attempts to shake down Linux users was
that if it is found that they did not actually have proof that actual
IP rights had been violated, then what they were doing was essentially
an extortion racket.  If the company goes bankrupt, all of the
officers of SCO at the time the money was collected, could be facing
criminal charges for fraud, extortion, and racketeering.

When Booze was outlawed in the 1920s, the gangsters and mobsters began
selling it illegally, but they also began "protecting" their
territory, threatening the restauraunts and clubs that didn't buy from
them (even if they didn't serve alcohol at all).

Bogus IP property claims has become the new form of racketeering.
Because the laws are so "mushy" we have squatters filing bogus patents
on 20 year old technology, then hiring goons in 3 piece suits to shake
down customers who purchased the software in good faith.  These
companies don't dare go after each other, because both sides have lots
of "Muscle".  A long and protracted legal war between to key players
can cost $millions, possibly even $billions if the players are big
enough.  On the other hand, shaking down the little companies produces
a bunch of cash with very little risk of a prolonged legal battle.

Microsoft has used this tactic before.  The Software Publishers
Association from 1990 to 1994 - often they would even come in and
seize an entire company's computers - unless the mark wanted to
"settle up" out of court.

The Business Software Alliance from 1995 to 1999 was used to squeeze
extra revenue from businesses who used shareware, but most of the
money went to Microsoft, who was the primary source of funding and the
primary recpient of settlements.

With Windows XP, Microsoft did it's own enforceent, deactivating users
if they felt that the customer had violated the license, offering to
relicense the software if the mark agreed to a long-term "service
contract".  Newer versions of Office also used these tactics.

> | The problem with the Novell deal is -- Novell gave Microsoft what
> | Microsoft dearly wanted, which is a public admission that they think
> | that Linux violates the Microsoft patent.
> `----
> http://www.itworldcanada.com/Pages/Docbase/ViewArticle.aspx?ID=idgml-...

Actually, no they didn't.  If they had, Novell would have had to stop
selling OpenSuse immediately.  If Microsoft had said "These 8,000
lines of code were originated by Microsoft, and you need to compensate
us" - it would have been Novell's duty to inform the Linux community
of these copyright violations.  To fail to do so would have made them
accessories to the fact, and conspirators after the fact.

Quite simply, if Novell knew for a fact that 8,000 lines of code were
owned by Microsoft, and neither Microsoft no Novell informed the
community, then every violation following that disclosure would have
been distributed with the full knowledge of both companies, that the
code was illegally distributed.  For all copies published prior to the
disclosure, Novell's officers would be accessories after the fact.
For all copies published after the disclosure, Novell's officers would
be accessories to the fact.  Furthermore, if either Novell or
Microsoft had expressed intent to profit from the piracy at some point
in the future, they would be conspirators and agents of the fact.

If you have some land, and you let it grow wild, and your neighbor
starts building a garage on some portion of that land, and you tell
your friends that you are going to wait until after the garage is
completed to sue them, both of you become conspirators to a fraud.
It's one thing to not realize they were building on your property and
then initiate a negotiated settlement, it's something else again to
deliberately withhold the fact and wait to disclose the information
until the last possible moment - for the purpose of increasing the
value of the settlement.

At minimum this would be considered contributory negligence.  Worse,
if the fact that you knew in advance and intende to profit from
witholding the information, you could end up forfieting all of the
rights to the property in question.

The irony is that by signing the agreement, Novell could be exposing
themselves to liability if Microsoft had disclosed ANY IP that they
claimed to have owned in Linux.  If the don't come clean now, the face
criminal charges later.


Rex


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