Bonum Certa Men Certa

SCO's Strategic Consultant Mike Anderer Foresaw Microsoft-Organised Patent Lawsuits Against Linux (Through Small Companies)

Ballmer on patents



"On the same day that CA blasted SCO, Open Source evangelist Eric Raymond revealed a leaked email from SCO's strategic consultant Mike Anderer to their management. The email details how, surprise surprise, Microsoft has arranged virtually all of SCO's financing, hiding behind intermediaries like Baystar Capital."

--Bruce Perens



Summary: Important information about Bedrock, those who bolster their case, and what we know about Microsoft's role in arming patent trolls, CIA coup d'état style

The poorer the patented 'invention' is, the more it will probably be worth (at lease once patented and never invalidated) because the more damage it can cause owing to breadth. The Linux Foundation and OIN recognised this when they defused attempts by Microsoft to pass around Linux-hostile patents, i.e. ammunition to disruptors (even that is not Microsoft's innovation). And right now there is a ridiculous patent being used against Android. Who is behind it? A defunct entity known as Bedrock (more details in our IRC logs). There is a paywall standing in the way of this article/analysis which contains "EVIDENCE OF AN UNACCEPTED OFFER FROM INTELLECTUAL VENTURES TO BUY THE BEDROCK PATENT".



Intellectual Ventures, created out of Microsoft money, is known to be using a lot of "satellite" companies to sue/extort companies on Intellectual Ventures' behalf. Only rarely does Intellectual Ventures sue directly, but sometimes it does. It's a proxy game and the victims struggle to validate the connections in the courtroom because when papers get exchanged as opposed to something physical, traces can vanish. We have covered several cases like this.

“Remember Microsoft trying to sell some of its patents that read on Linux, or so they claimed, to patent trolls? OIN played man in the middle on that one, but who is to say that was the only one?”
      --Pamela Jones, Groklaw
"Steven J. Vaughan-Nichols wrote a great article about the Bedrock v Google decision," writes walterbyrd in IRC. "Idiotic Anti-Linux & Google Patent Decision. Red Hat has sued Bedrock to get the patent revoked for numerous reasons. Among others, they point out that Linux, which dates to 1991, predates the 1997 patent; that no one has ever used the patent; and that in any case Bedrock has no claims to the patent," he quotes. Groklaw too is linking to SJVN (Steven J. Vaughan-Nichols) and adds: "If I might remind you, Mike Anderer told us years ago, back in 2004, that this was Microsoft's plan, to see to it that FOSS companies got sued over and over again for patent infringement, until they gave out: "In a world where there are $500 million dollar patent infringement lawsuits imposed on OS companies (although this is not completely settled yet), how would somebody like Red Hat compete when 6 months ago they only had $80-$90 million in cash? At that point they could not even afford to settle a fraction of a single judgment without devastating their shareholders. I suspect Microsoft may have 50 or more of these lawsuits in the queue. All of them are not asking for hundreds of millions, but most would be large enough to ruin anything but the largest companies. Red Hat did recently raise several hundred million which certainly gives them more staying power. Ultimately, I do not think any company except a few of the largest companies can offer any reasonable insulation to their customers from these types of judgments. You would need a market cap of more than a couple billion to just survive in the OS space." So that's what he said. And 50 or more lawsuits lined up means using proxies, obviously. Remember Microsoft trying to sell some of its patents that read on Linux, or so they claimed, to patent trolls? OIN played man in the middle on that one, but who is to say that was the only one? That's why it's an antitrust issue, I'd say, using patents like this as an anticompetitive weapon. And if you want to know what is wrong with software patents, the damage they are doing, read the quotations from various business executives (like Andy Grove) in the footnotes to this article."

Here is the link given to analysis of important news reports which are only in the Web Archive now (content ages and rots quite sadly, along with the crucial evidence). We reproduce this below in the interests of preservation:

Legal

S2 'mystery man' Anderer speaks on MS, SCO, and licensing



Friday March 12, 2004 (05:30 PM GMT)

By: Chris Preimesberger

Mike Anderer was the author of the S2-to-SCO Group memo that comprises the "Halloween X" document that was released to the press by Eric Raymond last week. Anderer, the CEO of S2 and the middleman in the SCO Group's $50 million PIPE transaction of last October 16 contacted us today, and while he is under a non-disclosure agreement and can't say very much about the $50 million PIPE deal, what follows are some of the thoughts he can share.

I am certain people would like to know what is happening but I cannot talk to you without permission. I will tell you my background is integration and I am OS agnostic; the more there are the better. I will file close to 20 patents this year for companies in many spaces, including homeland security, anti-terrorism, several grid computing and virtual machine patents, and, ironically, I should have one issued in the expiring and disappearing e-mail arena. It was initiated 4-5 yrs ago.

I have helped many companies and individuals who run companies in the GNU/Linux, BSD, and Unix world as well as those in the Microsoft world. I admire the good parts and despair the bad parts.

Most of my time is currently spent on new technologies on several different platforms. Many of my companies and several of our offices have been merged into other companies, moved or sold as part of a technology deal, some even sold during the deepest parts of the downturn. I helped build the channels for most of the products that corporate America is currently using and some they will be using soon. In several cases, I am finally finding or developing ways to solve problems I have been working on for the last 20 years. The only way I can hide is to work so hard that it becomes close to impossible to track all the companies I have owned, bought, sold, rolled up, or sat on the board of. If you include the ones where I helped entrepreneurs and companies through tough times, or sat on non-profit boards, the list would be even tougher to follow.

Anybody who knows me or really analyzes what they found on the Web will find I don't hide well. I also have a lot to say in most situations.

The following is simply my opinion. This is all I can really give you considering the NDA. As for the PIPE deal, I cannot comment at all, but I also would have nothing of interest to add beyond what has already been made public.

I would state that this licensing project represented only a small fraction of my time over the last year and has completely gone away in recent months. This was a job for me, and licensing IP has been an increasingly significant portion of my work.

Many thousands of licenses have been sold to Unix over the years. I cannot think of any major hardware or software company or even university that does not have a license directly or indirectly. If you see the world moving forward as a (GNU/Linux/BSD/Unix)/Windows world it does not take an MIT rocket scientist to think it would make sense for the largest software company in the world to increase their rights by taking another license (remember they did develop and own a portion of the code originally sold as MS Xenix). In fact I saw several postings on Slashdot hammering them for including what people saw as BSD property (with proper copyright attribution) in some of their products. It was also no secret that Microsoft licensed and even purchased companies in this arena over the last several years (look where Windows Services for Unix came from). They developed some pretty incredible functionality into things like SFU 3.5 (which I just got for free with a systems magazine). If you consider this licensing an indirect financing of SCO, then everybody (or at least the thousands of licensees) is responsible at some level. The licenses in some cases exceeded $100 million, so these were not even close to the largest ones. The hard part for me was finding somebody who was not already a big licensee.

Just as I see Microsoft developing stronger interoperability from their side, I see a huge community developing stronger connectivity from the GNU/Linux/BSD/Unix side. We will work from both sides and hopefully contribute to making things more functional for customers whatever they choose. The only really interesting point here is that people finally benefit from more stuff working together. It still takes work, but things are getting better in many areas.

I think one real issue, that people are skirting, is who will be the ultimate guarantor of IP-related issues in a world that is governed by the GPL and GPL-like licenses. I could easily see IBM, HP, Sun, and many of the other large hardware players solving this problem tomorrow by settling the dispute with SCO and maybe even taking the entire code base and donating it into the public domain. I know this is what I originally thought would happen, at least the settlement part. I am not certain what people who paid tens of millions for licenses would say if what they paid for was now free, but that is a different issue.

In a world where there are $500 million dollar patent infringement lawsuits imposed on OS companies (although this is not completely settled yet), how would somebody like Red Hat compete when 6 months ago they only had $80-$90 million in cash? At that point they could not even afford to settle a fraction of a single judgment without devastating their shareholders. I suspect Microsoft may have 50 or more of these lawsuits in the queue. All of them are not asking for hundreds of millions, but most would be large enough to ruin anything but the largest companies. Red Hat did recently raise several hundred million which certainly gives them more staying power. Ultimately, I do not think any company except a few of the largest companies can offer any reasonable insulation to their customers from these types of judgments. You would need a market cap of more than a couple billion to just survive in the OS space.

Since the GPL type license agreements push the liability to the users, who do you go after? I think this is a key problem. Nobody wants to be the ultimate guarantor for software that was free (or close to it). I think the dispute with SCO would have been settled a long time ago if everybody knew this was the last one. The problem is there will probably be hundreds or even thousands of these disputes in the future and the targets will be the companies with the deepest pockets. Even if the large vendors disclaim all responsibility initially, I do not think the customers will accept this from their vendors for very long. In the meantime, I don't see anybody being in a hurry to write the first big check.

The world of software is changing. I think everybody sees that part on the product side, but the economic underpinnings are changing too. It used to be you included R&D and patent development costs into your license add your costs and a markup and you could make a living. We relied on cross-licensing, licensing, and innovation, and our ability to prevent other people from copying our work without permission. Now things are shifting, but I am not certain anybody has completely figured out this new model, and if you think it is just any one company that is concerned about this, you are wrong.

I do think things will work out, and the sooner the better. I believe the software industry is in an incredible renaissance and that means maybe there will be a lot more people out there making things better and a couple fewer people with enough spare time to flame under five separate handles, all registered as underage so they can exploit the better privacy laws we afford to children.

I do appreciate all the effort and help people have provided by digging up old sites and even stuff I had long forgotten about. I am still hoping people dig up some of the more positive projects I have been involved with. I have also had several long lost friends contact me. I think they thought I might need some support.

-- Mike


Microsoft Florian (aka "FOSS[will be killed by]Patents") is rubbing this in people's faces (consider the headline, "Texas jury finds against Google in Linux patent case, determines damage award of $5,000,000"). ZDNet feeds Microsoft Florian's drama and so does CNET, a sister site in some sense (ZDNet bloggers also played along with SCO's side). Florian keeps bragging about the number of lawsuits against Android and amplifies the magnitude of the threat to Android by repeating news like this. Harry McCracken, the Microsoft booster, does something similar to what Florian did some months ago, amplifying the perceived problem. Let's not forget other Microsoft mouthpieces like Rob Enderle and Paul Thurrott with his anti-Android rhetoric (patent-related accusations and FUD). Meanwhile, the president of the FFII is told that "Google should really start to actively fight against #swpat it could donate a million to #ffii and #endsoftwarepatents.org each." The messenger is right in this case and we wrote about it earlier this month. Google ought to know that just getting more patents won't help it against trolls.

“Patent incumbent H.264 will soon lose its dominance as YouTube, the world's biggest online video content creator, switches to WebM, the free and open source codec.”
      --Muktware
Could Google work on research that proves ties to Microsoft and then initiate legal action for these mafia-like tactics (including the SCO and maybe Elliot saga)? Potential patent trolls whom we know Microsoft was trying to feed with anti-Linux patents are pretty solid evidence [1, 2, 3, 4, 5, 6]. Microsoft never refuted this, it only tried deflection by announcing CodePlex news noise within hours. There is also MPEG-LA, which Microsoft is paying. Google does mitigate the issue by addressing that attack vector the way it should. From the news: "Patent incumbent H.264 will soon lose its dominance as YouTube, the world's biggest online video content creator, switches to WebM, the free and open source codec." OIN's growth [1, 2, 3] is not enough to prevent MPEG-LA from acting like a mafia, bidding/searching for Google assassins and then getting exposed. Fortunately, the US Justice Department launched an investigation over this and I should probably mention, based on my private discussions with Microsoft Florian, that Florian has contacts inside MPEG-LA, which he keeps promoting. Yes, I can produce evidence to show this, but he probably won't contest or challenge the claim for fear of more damage control.

Here is Steven J. Vaughan-Nichols explaining that Microsoft Florian is falsely amplifying the scare over patents and Android:

Now, I hate all software patents, but even if I didn’t, this patent is garbage. As I read it, I think I violated it myself back in the 80s. I mean, just read it, it’s a description of how to use hashing with a linked list. Come on! That might not be programming 101, but it’s not far from it!

Red Hat has sued Bedrock to get the patent revoked for numerous reasons. Among others, they point out that Linux, which dates to 1991, predates the 1997 patent; that no one has ever used the patent; and that in any case Bedrock has no claims to the patent. This case, however, has not been settled yet.

Yes, I know, I know, you’d think that case would have been settled first and then the matter of Red Hat’s customers would have been addressed, but that’s not how it works in the U.S. Verdict first and trial later to paraphrase Alice in Wonderland’s Red Queen.

Now some people, such as Florian Mueller, would have you think that “This patent infringement case has major implications for the IT industry in general and for Linux in particular.” The emphasis is his. I disagree.

I think this is an especially striking example of a bad patent decision by the EDTX. It only shows just how bad the U.S. patent system has become that such a ridiculous suit could ever be taken seriously never mind actually winning. Google should appeal this case and, unlike other recent software patent cases, such as Microsoft vs. i4i, I’d expect the anti-patent side to win.


It remains to be seen if Microsoft also plays a role in Apple's lawsuits (see this nice new parody), but given motivations, it is unlikely that Apple needs Microsoft's encouragement to sue Google's Linux-based platform. It should be noted, however, as we noted last year, that very shortly after Apple sued Android Microsoft made a formal statement validating and endorsing Apple's action, adding that there will be more of that. It was almost as though the pair had conspired.

Comments

Recent Techrights' Posts

Newer is Not Better, Lunar Edition
Maybe in 57 years (2083, after all these wars) we'll managed to launch a capsule with a human and a dog above the stratosphere again
 
Gemini Links 07/04/2026: Copyleft Revisited, Killing Linux Processes With FZF
Links for the day
It Would be Good for Debian to Have a Female DPL, But...
Debian isn't exactly selecting people for quality or policing bad behaviour
IBM Insiders Say What's Wrong With IBM in Albany (and Yes, There Are Layoffs)
promotions boil down to what insiders now call "brown-nosing" and nepotism
After Killing OpenSource.org IBM Together With OSI Told Us It Would Carry on OpenSource.net, But the Site Has Been Essentially Dead for 9 Months (Effectively Abandoned)
OpenSource.org has been dormant for 4 weeks already and OpenSource.net last had a new page 9 months ago (it'll be 9 months tomorrow) [...] That's IBM in a nutshell
A Lot of What Happened to OSI is Because of Reporting by Techrights
Half a year since Stefano Maffuli (Executive Director) "left"
Public Presentations by RMS Hardly Interrupted Anymore
We'll carry on covering those sorts of topics throughout the year
Links 07/04/2026: US Wants to Put Journalists in Prison for Reporting Facts, Artist ‘Bale’ Arrested Over Rape Allegation in Social Control Media
Links for the day
To IBMers, IBM Has Failed and is Fast Becoming a Book of Jokes and One-Word Punchlines
How else can one make it obvious that IBM is circling down the drain?
"AI Revolution" Was a Lie: Microsoft CEO Admits What He Calls "AI" is Sometimes Sloppy and Microsoft Admits That Slop is for "Entertainment Purposes Only" (Not for Any Serious Work)
if it gets "memory-holed", we can bring it up again and again
Social Control Media is Not a Viable Business Model
The future of the Web might not be the Web
From Datacentres Boom to Actual Booms That Target Datacentres, Now Struggling to Justify Humongous Energy and Water Consumption
Datacentres that are used for mindless "entertainment" (as Microsoft calls it) like slop are not a priority at this time
Gemini Links 07/04/2026: Aircraft Lift Force, Editor History, and Consumer Hardware Stagnation
Links for the day
Over at Tux Machines...
GNU/Linux news for the past day
IRC Proceedings: Monday, April 06, 2026
IRC logs for Monday, April 06, 2026
What Matters is Software Freedom, Not the Brands
The important thing is to speak about Software Freedom
Wikileaks is About to Turn 20
~2 days ago it turned 19.5
The Cloud of Smoke
Will 2026 be the year that "The Cloud" openly confesses the risks it brings about?
SLAPP Censorship - Part 36 Out of 200: Claim KB-2024-003529 in a Nutshell (Microsoft Employee Does Terrible Things, Then Sues the Reporter in Another Continent)
It commences with more of an overview
Gemini Links 06/04/2026: Solar Panel Story and Centralisation
Links for the day
"Free Speech, Free Press": What the World Needs to Improve
Darkness breeds corruption
IBM prioritises a "lot of smoke and hype and use of trending buzzwords"
IBM can pretend all it wants things are fine
GAFAM Paying the Price for Pursuing US Military Money (Taxpayers' Money as 'Stimulus' With Strings Attached)
The "cloud" in cloud computing is a cloud of smoke
Observing Slop's Demise
If energy becomes more scarce, then one rare/side perk (or upside) will be slop companies screaming for lifeboats
Links 06/04/2026: Crackers Breached the European Commission, Why "Old Way of Campaigning Won’t Cut It Anymore"
Links for the day
Enron Versus NVIDIA (the Cost of Circular Financing, or Funding Your Own Customers to Buy Your Products) - “The Inventory Paradox” or “The Vibe Revenue Admission”
Round-tripping (finance)
You Know "The Economy" is Fake When 6 Months After Oracle Says Debt-Saddled 'Open' 'AI' (Slop) Will Pay It $300,000,000,000 Oracle Says It Must Lay Off 30,000 Workers at 6AM
Oracle is in deep debt, which increased at a pace of almost 4 billion dollars per month lately
Free Software Will Outlive GAFAM
GAFAM is overhyped
Techrights Was Further Decentralised Three Years Ago
In 2020 we began working on IPFS stuff
The Military Attacks on Dubai Internet City as Reminder That GAFAM Isn't Safe (Disregard the "Nobody Gets Fired for Buying GAFAM" Mindset)
These are all realistic and foreseeable scenarios that GAFAM sceptics have long warned about
The Wars Aren't Ending, Now We See GAFAM Facilities Being Bombed
This is becoming a tech issue
Links 06/04/2026: Turning 34, Throwing Things Away, and Printing in GNU/Linux
Links for the day
Links 06/04/2026: Ex-Microsoft Engineer Explains Why Azure Fails, Germany Prepares for War
Links for the day
EPO "Cocaine Communication Manager" - Part XI - EPO Strike Enters Its Second Week, EPO Sheds Off Qualified Staff to Make Way for Nepotists
More than six months ago the "Cocaine Communication Manager" got arrested for cocaine use
Another Microsoft Outlook Downtime
Microsoft has sloppy code, it's not something suitable for mission-critical things
Week 2 of April IBM Layoffs Accelerate Based on Rumours
"Heard about Layoff at IBM"
Over at Tux Machines...
GNU/Linux news for the past day
IRC Proceedings: Sunday, April 05, 2026
IRC logs for Sunday, April 05, 2026
Culture of Harassment Inside Microsoft, Says Former Director at Microsoft
listen to Microsoft insiders
Drone Strikes on Amazon (GAFAM) Datacentres Highlight Azure's Miniscule Share
Azure is failing
SLAPP Censorship - Part 35 Out of 200: How to Make ~10,000 Pound Sterling (13,220.50 United States Dollars) by Copy-Pasting and Editing 10 Pages
Today it's Easter Sunday, so we'll keep this part relatively short
Gemini Links 05/04/2026: Artemis II Mission Tracker, Meditation on Copyright, Alhena 5.5.5, "Gemini as the Final Frontier of Human Cognition"
Links for the day
Microsoft Windows Falls to All-Time Low of ~60% in Switzerland, GNU/Linux Among Top Gainers
What will it take for mainstream media (not just geeks' site) to cover it?
Mainstream Media on "Practical Survivalism"
Suffice to say, panic buying begets more panic and price surges
Cloud Computing as a Cloud of Smoke (Your Hosting Provider is a "Legitimate" Military Target)
When a French datacentre went up in flames people joked that the "cloud" meant a cloud of smoke
Andreas Tille Congratulates Sruthi Chandran Before the Election for Debian Project Leader (DPL) is Even Over
Andreas Tille, the current Debian Project Leader (DPL) who has been in this role for nearly 24 months
When You Try to Change the World for the Better and Somehow They Find a Way to Say You Are the Villain
Don't be a fool. Don't fall for inversions of narratives.
Slop Was a Flop and Energy Crisis Will be Slop's Final Blow
Today we see no slopfarms in Google News
Links 05/04/2026: "Taiwanese Airlines to Hike Fuel Surcharges 157%" and Openly Racist Voter Suppression Starts in the US
Links for the day
Gemini Links 05/04/2026: Playing with Hyprland and Migrating Antenna Filters
Links for the day
Links 05/04/2026: "Confidential Computing" as Proprietary Bundle of False Promises and "The Web Is an Antitrust Wedge"
Links for the day
Over at Tux Machines...
GNU/Linux news for the past day
IRC Proceedings: Saturday, April 04, 2026
IRC logs for Saturday, April 04, 2026