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Novell Offers Liability Shield for SUSE Linux

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Novell Tuesday revealed it will indemnify customers against potential intellectual property challenges to its SUSE Linux distribution in the face of SCO Group’s copyright challenge of some parts of the Linux operating system code.

Enterprise customers of the business software company will receive a ‘measure’ of protection against potential copyright challenges.

The Provo, Utah-based network software maker, which plans to announce the completion of its $210 million acquisition of Germany-based SUSE Tuesday, said the protection applies only to certain products, such as SUSE Linux Enterprise Server 8 and only under certain circumstances.

Novell spokesperson Bruce Lowry told the decision was not motivated by any particular company. Novell’s move comes amid SCO’s lawsuit against IBM over whether Big Blue let select parts of its copyrighted UNIX code into the open source operating system.

“What indemnification does is address the problem and give our enterprise customers a measure of protection against copyright challenges,” Lowery said. “We have a distribution and now we have unique legal rights over that issue of the business.”

Novell also said it plans announce a special program where Linux users who are not currently its SUSE LINUX customers can stand under the company’s umbrella indemnification program.

“We believe our new Linux indemnification program, supported by our unique legal rights, will provide enterprise customers with one more reason to include Linux in their information technology plans,” Novell chairman and CEO Jack Messman said in a statement.

Since September, the only major vendor to offer indemnification from
legal threats against its version of Linux was Hewlett-Packard.

“This is an important next step in the industry’s move to make Linux
safe from litigation for end customers,” HP vice president of Linux Martin
Fink said in a statement. “We are pleased to see and are in favor of
Novell’s effort to extend protection and peace of mind to its customer base.”

The news comes less than 24-hours after the Open Source Development Lab (OSDL) established a $3 million account to defray the court costs incurred against Linus Torvalds, Linux kernel creator and OSDL Fellow, and other OSDL employees who were subpoenaed by the SCO Group as part of the dispute.

Novell is in a unique situation; however, in that it has a historical
ownership chain of UNIX and UnixWare. Despite SCO’s claims, Novell said it has
the right to authorize its customers to use that UNIX technology in their
internal business operations. Novell also said it has the right to take action
on behalf of SCO under legacy UNIX SVRX licenses pursuant to the Asset
Purchase Agreement between SCO and Novell.

SCO officials were not available for comment on Novell’s stance but told this week that it will move forward with legal action against companies it feels have violated SCO’s copyrighted material.

As for the SUSE acquisition, Novell said it will continue the SUSE Linux brand. The deal opens the door for completion of the $50 million investment of IBM in Novell announced Nov. 4.

Under the transaction, SUSE Linux becomes a product business unit within Novell, with its sales and marketing handled by Novell’s existing geographic business units and SUSE Linux’s current sales and marketing staff. SUSE also retains its structure within Novell, like that of open-source company Ximian in August 2003. The company said it would
market SUSE to promote Linux adoption and Novell’s product lines.

Richard Seibt, the former CEO of SUSE Linux, is expected to stay on with
Novell and continue to manage SUSE LINUX as President. The company said SUSE
engineers will work closely with Novell’s product teams as part of the transition process.

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