SCO vs. IBM


As reported in this story at Infoworld and this story in the Provo Daily Herald (for some local color), SCO has filed suit against IBM for allegedly distributing source code that belongs to SCO in violation of a license agreement between the two companies.

This isn't too surprising. One of the major investors in SCO (ne'e Caldera) is the Canopy Group. The Canopy Group believes in intellectual property and they believe in protecting it. They also are not afraid to litigate. This has been a successful strategy for SCO in the past and companies remember success and try to repeat it.

When I wrote about this last month it prompted some responses some people in the open source crowd, which led me to write a piece on Ethics and Fiduciary Duties. The question to be asked is "are the actions of SCO management legal, ethical, and in the interest of their shareholders?" If so, then that is the course of action they should pursue.

One could, of course, argue that another course of action, for example an open source strategy, would be better for their shareholders. In that case, the plan should be presented to the board and, if approved, carried out.

My bottom-line analysis on this is that SCO has a fiduciary duty to take this action regardless of whatever philosophical beliefs management has on open source unless their investors specifically agree to an alternate strategy.