SCO files appeal brief against Novell in the case that refuses to die

When will they run out of money?

At this point, this appeal is out of sheer desperation. The last SCO appeal to the Tenth Circuit gained SCO a reversal, but that was based on the far more reversible issue of a trial court's having granted summary judgment on the UNIX ownership issue, which allowed the appeals court to review the issues de novo (meaning, without having to give any special deference to the trial court's conclusions, etc.). This appeal, however, is from an adverse judgment following a full jury trial on the merits. In this type of situation, the appeals court must give great deference to how the jury determined the facts and will be loathe to second-guess the outcome. Thus, to win on this appeal, SCO essentially has to point to alleged errors of law that would have tainted the jury verdict and this likely will be extremely difficult to do in this type of case.

The appeal in spite of the desperate situation arises from the fact that SCO is represented by a top-tier law firm that has a direct financial incentive to apply scorched-earth tactics in an effort to secure a win at any cost, no matter how small the odds of getting a victory. Thus, this appeal raises issues having to do with more than the trial itself. It is evident that the firm has scoured every facet of this multi-pronged litigation and is attacking on all possible fronts, hoping that something will somehow stick. This has little to do with the solvency of SCO itself, because the litigation remains essentially as the only significant asset belonging to the company and the duty of a bankruptcy trustee (or a debtor-in-possession if there is no trustee) is to attempt to maximize the value of all assets in a bankruptcy estate on any reasonable basis. If the law firm is going to pick up the cost of the litigation, then the trustee or debtor-in-possession has every incentive to keep the matter alive in hopes of realizing on a long shot.

By every normal litigation measure, this appeal should not have been filed given the bankrupt status of SCO and given the difficulty of ever winning it. Since, however, there are enormous dollars at stake in the event a long-shot reversal is obtained, and since SCO effectively does not have to pay the tab for the continued fight, this will go on and on unless and until the parties settle or until all appeals are exhausted and the trial verdict is upheld. In other words, the case should have died but it hasn't and it won't in the near term, even while it may have effectively died on the merits with the entry of the jury verdict.