Novell to pursue SCO trial

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After absorbing the effects of abandoning the proposed potential sale of its disputed Unix business, the US judge presiding over its Chapter 11 bankruptcy proceedings has ruled SCO must still face Novell in court.

The ruling, made by Judge Kevin Gross in the Delaware bankruptcy court where SCO's filing for Chapter 11 reorganisation is being heard, means the embattled will have to face Novell and other vendors in the Utah court handling its Unix copyright lawsuit.

Proceedings in the three-and-a-half year battle between SCO, Novell and other vendors had been put on hold while SCO's financial affairs were sorted out under the Chapter 11 filing made in September.

But Judge Gross's ruling now means SCO's reorganisation will have to wait for the Utah case to be concluded and the amount of royalties Novell is entitled to is decided, after Novell won a key ruling on in copyright case in August.

In his order lifting the automatic stay on the Novell case, Judge Gross wrote that it had been granted because "the learned [Utah] District Court issued a thorough 105-page opinion carefully analysing the facts and law".

"The District Court's mastery of the facts and law pertaining to the Lawsuit is a powerfully important consideration in the Court's decision to lift the stay," it said.

The Delaware order now means Judge Dale Kimball of the US District Court for the District of Utah will get to rule on whether SCO also had the authority to enter into licensing agreements with Microsoft and Sun.

SCO will then have to return to Delaware to determine what is and is not property of the estate for Novell to pursue.

In August, the Utah Judge ruled against SCO in the copyright lawsuit it brought against Novell, IBM and other vendors, effectively killing off SCO's claims that they had breached its Unix intellectual property rights in a variety of products.

SCO's financial viability, having committed much of its finances to fighting the lawsuit, has been in dispute ever since, having been threatened with delisting from the Nasdaq stock exchange before making its Chapter 11 filing.

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