IBM, Red Hat face copyright, antitrust lawsuit from SCO Group successor Xinuos

Big Blue and its claret-capped subsidiary accused of nicking UnixWare blueprints, lying, and conspiring


Updated Xinuos, formed around SCO Group assets a decade ago under the name UnXis and at the time disavowing any interest in continuing SCO's long-running Linux litigation, today sued IBM and Red Hat for alleged copyright and antitrust law violations.

"First, IBM stole Xinuos' intellectual property and used that stolen property to build and sell a product to compete with Xinuos itself," the US Virgin Islands-based software biz claims in its complaint [PDF]. "Second, stolen property in IBM's hand, IBM and Red Hat illegally agreed to divide the relevant market and use their growing market powers to victimize consumers, innovative competitors, and innovation itself."

The complaint further contends that after the two companies conspired to divide the market, IBM then acquired Red Hat to solidify its position.

SCO Group in 2003 made a similar intellectual property claim. It argued that SCO Group owned the rights to AT&T's Unix and UnixWare operating system source code, that Linux 2.4.x and 2.5.x were unauthorized derivatives of Unix, and that IBM violated its contractual obligations by distributing Linux code.

That case dragged on for years, and drew a fair amount of attention when SCO Group said it would sue individual Linux users for infringement. Though SCO filed for bankruptcy in 2007 and some of the claims have been dismissed, its case against IBM remains unresolved.

There was a status report filed on February 16, 2018, details remaining claims and counterclaims. And in May last year, Magistrate Judge Paul Warner was no longer assigned to oversee settlement discussions. But SCO Group v. IBM is still open.

SCO Group's 2004 lawsuit against Novell appeared to come to a more conclusive end in 2007 when the judge hearing the case ruled that Novell owned the Unix copyrights. But that was reversed on appeal and the spat continued until SCO sold its assets to Xinuos/UnXis in April 2011, and the US Tenth Circuit Court of Appeals in August that year upheld the trial judge's prior ruling in favor of Novell.

Xinuos' lawsuit contends that IBM stole UnixWare and OpenServer code and incorporated it into the heart of its AIX, z/OS mainframe, and its midrange server operating systems. It further asserts that IBM has misled investors by stating in its annual reports since 2008 that it owns all of the Unix and UnixWare copyrights.

"While this case is about Xinuos and the theft of our intellectual property," said Sean Snyder, president and CEO of Xinuos, in a statement. "It is also about market manipulation that has harmed consumers, competitors, the open-source community, and innovation itself."

An IBM spokesperson told The Register that the company has not yet been served with a copy of the complaint. Red Hat did not immediately respond to a request for comment. ®

Updated to add

“Xinuos’s copyright allegations merely rehash the stale claims of its predecessor, whose copyrights Xinuos purchased out of bankruptcy—and have no merit,” an IBM spokesperson said in an email to The Register.

“Xinuos’s antitrust allegations, brought against IBM and Red Hat, the world’s largest open source company, similarly defy logic. IBM and Red Hat will aggressively defend the integrity of the open source development process and the inherent choice, and thus competition, that open source fosters.”

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