Lindon Based SCO Group Sues AutoZone

Lindon Based SCO Group Sues AutoZone

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SALT LAKE CITY (AP) -- Taking a page from the music industry, the SCO Group Inc. filed two lawsuits Wednesday against AutoZone Inc. and DaimlerChrysler Corp. to force them and other companies into complying with copyright laws and SCO's software agreements.

"We have now taken the significant next step," said SCO President Darl McBride, who said his company will "vigorously protect and enforce" its intellectual rights.

The copyright infringement lawsuit against auto-parts company AutoZone Inc. alleges the chain runs versions of the commercially-purchased or freely distributed Linux operating system that contain code belonging to SCO.

The lawsuit, filed in Nevada, demands AutoZone immediately stop using or copying any part of SCO's copyrighted code. It also seeks unspecified damages.

AutoZone spokesman Ray Pohlman said the company hasn't seen the lawsuit and would not comment. Pohlman also refused to say how the company uses Linux.

"We've identified that we have issues with commercial users using our intellectual property," said SCO spokesman Blake Stowell, who said there are about 2 million servers now running Linux. "We've not said we have issues with home users."

The Lindon, Utah-based SCO also filed a lawsuit in Michigan against DaimlerChrysler Corp., alleging the automaker refused to comply with terms of its software agreement with SCO.

It asks that the automaker immediately certify compliance and seeks damages, including legal fees. DaimlerChrysler officials had not seen the lawsuit Wednesday and were not in a position to comment, said spokeswoman Mary Gauthier.

DaimlerChrysler years ago obtained a Unix license with the owners of the operating system, but Stowell did not immediately know if it was through SCO or two previous owners, Novell or AT&T.

Part of that license said at the owner's discretion, the company could at least once a year perform an audit to make sure the users were abiding by the terms of the agreement, which includes not giving away any part of the code.

SCO sent letters to 3,000 license holders, including DaimlerChrysler, asking them to certify they were still complying with terms of the license.

SCO is not alleging that DaimlerChrysler is abusing the license, but the automaker was one of less than 1,500 licensees who did not respond to that letter, Stowell said.

"When a customer fails to certify, it kind of leaves you to wonder why they are not certifying, which is one of the reasons why the lawsuit was filed," Stowell said.

"These are not just two users we randomly picked," McBride said. Instead, he said they represent of two classes of Linux users who are violating either SCO's agreement or copyright.

Instead of going after others who have not signed compliance agreements, SCO is attacking the issue along the same lines as the music industry, hit hard financially by people illegally downloading music off the Internet.

Since September, the Recording Industry Association of America has sued 1,445 end users who allegedly downloaded copyrighted songs. The music industry says its tactics are slowing the tide of free downloads.

"We believe the legal actions we have taken ... will have a similar impact," McBride said.

Over the last several months, SCO has sent letters to about 1,500 companies demanding they pay licensing fees of about $700 for each server running Linux or face legal action.

SCO holds the rights to key elements of the 30-year-old Unix operating system from which Linux was inspired, and claims parts of it have been incorporated in Linux. Those claims are disputed by, among others, IBM Corp. and Novell Inc. IBM and SCO have traded lawsuits over the matter.

Unlike Unix or Microsoft Corp.'s Windows, Linux is developed by a worldwide community of programmers and is free to copy or download, making it attractive to many corporations.

IBM, Intel Corp. and others have contributed to a legal fund that will help companies running Linux defray the cost of defending themselves against lawsuits.

Also Wednesday, SCO said that after paying dividends on preferred shares, it lost $2.25 million, or 16 cents a share, in its fiscal first quarter ended Jan. 31.

It lost $724,000, or 6 cents a share, in the same quarter last year.

Revenue fell 16 percent to $11.4 million from $13.5 million.

(Copyright 2004 by The Associated Press. All Rights Reserved.)

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