SCO Grp v. Novell Inc

Filing 619

REPLY to Response to Motion re 608 MOTION to Set Aside Judgment filed by Defendant Novell, Inc.. (Brennan, Sterling)

SCO Grp v. Novell Inc

Doc. 619

MORRISON & FOERSTER LLP Michael A. Jacobs, pro hac vice Eric M. Acker, pro hac vice Grant L. Kim, pro hac vice 425 Market Street San Francisco, CA 94105-2482 Telephone: [phone] Facsimile: [phone] WORKMAN I NYDEGGER A PROFESSIONAL CORPORATION Sterling A. Brennan (Utah State Bar NO.1 0060; E-mail: [e-mail]) David R. Wright (Utah State Bar No. 5164: E-mail: [e-mail]) Kirk R. Harris (Utah State Bar No. 10221; E-mail: [e-mail]) Cara 1. Baldwin (Utah State Bar No. 11863; E-mail: [e-mail]) 1000 Eagle Gate Tower 60 E. South Temple Salt Lake City, Utah 84111 Telephone: [phone] Facsimile: [phone] Attorneys for Defendant and Counterclaim-Plaintiff Novell, Inc.

IN THE UNITED STATES DISTRICT COURT DISTRICT OF UTAH, CENTRAL DIVISION

THE SCO GROUP, INC., a Delaware corporation, Plaintiff,
vs.

Case No. 2:04CV00139 REPLY IN SUPPORT OF NOVELL'S RULE 60(b) MOTION FOR RELIEF FROM FINAL JUDGMENT

NOVELL, INC., a Delaware corporation, Defendant.

Judge Ted Stewart

AND RELATED COUNTERCLAIMS.

Dockets.Justia.com

TABLE OF CONTENTS Page T ABLE OF AUTHORITIES I. II. PRELIMINARY STATEMENT THE MANDATE RULE DOES NOT NULLIFY THE COURT'S AUTHORITY UNDER RULE 60(B)(5) TO GRANT RELIEF FROM A JUDGMENT THAT IS BASED ON A RULING THAT HAS BEEN REVERSED A. B. The Plain Language of Rule 60(b)(5) Authorizes Relief from a Final Judgment that Is Based on a Ruling that Has Been Reversed Federal Courts Have Unanimously Held that Rule 60(b)(5) Authorizes Relief from an Unappealed Judgment Based on a Ruling that Has Been Reversed SCO's Cited Cases Do Not Hold that the Mandate Rule Nullifies the Court's Rule 60(b)( 5) Authority to Grant Relief from a Judgment that is Based On a Ruling that Has Been Reversed 1. 2. 3. III. Cases that do not involve any provision of Rule 60(b) are irrelevant. Cases that involve Rule 60(b)(1), (4), and (6) are irrelevant. The Rule 60(b)( 5) cases relied upon by SCO do not involve a judgment that is based on a ruling that has been reversed ii 1

.2 .2

.4

C.

5 5 6 7

NOVELL IS ENTITLED TO RULE 60(B)(5) RELIEF BECAUSE THE SVRX JUDGMENT WAS BASED ON THE SUMMARY JUDGMENT RULING THAT WAS REVERSED, AND NOT ON INDEPENDENT GROUNDS A. B. The Fact that the SCOsource Agreements Involved a Release Does Not Independently Support the SVRX Judgment.. Judge Kimball's Finding that the SCOsource Agreements Were Limited to UnixWare Was Based on His Ruling that SCO Did Not Own the SVRX Copyrights Judge Kimball's Finding that the License in Section 4 of the Microsoft Agreement Is "Incidental" to a UnixWare License Has No Bearing on Whether the Release in Section 2 Constitutes an SVRX License

8 8

9

C.

10 10

IV.

CONCLUSION

sf-2789748

TABLE OF AUTHORITIES Page(s)
CASES

Ackerman v. United States, 340 U. S. 193 (1950) Bethea v. Levis Strauss & Co., 916 F.2d 453 (8th Cir. 1990) California Med Ass 'n v. Shalala, 207 F.3d 575 (9th Cir. 2000) Cashner v. Freedom Stores, Inc., 98 F.3d 572 (10th Cir. 1996) Colorado Interstate Gas Co. v. Natural Gas Pipeline Co. of Am., 962 F.2d 1528 (lOth Cir. 1992) Coltec Indus., Inc. v. Hobgood, 280 F.3d 262 (3d Cir. 2002) Cruikshank & Co. v. Dutchess Shipping Co., 112 F.RD. 4 (S.D.N.Y. 1986) Doe v. Chao, 511 F.3d 461 (4th Cir. 2007) FDIC v. Canfield, 967 F.2d 443 (10th Cir. 1992) Flowers v. S. Reg'l Physician Servs., 286 F.3d 798 (5th Cir. 2002) Fox v. Mazda Corp. of Am., 868 F.2d 1190 (10th Cir. 1989) Huffman v. Saul Holdings Ltd P'ship, 262 F.3d 1128 (10th Cir. 2001) In re PettIe, 410 F.3d 189 (5th Cir. 2005) Jones v. Us., 255 F.3d 507 (8th Cir. 2001) Lubben v. Selective Servo Sys. Local Bd, 453 F.2d 645 (1 st Cir. 1972)

6 6 .4 6 6 8 7 6 2 .4 5 5 6 3, 4 7

sf-2789748

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MacArthur v. San Juan County, 391 F. Supp. 2d 895 (D. Utah 2005) Massengale v. Okla. Ed of Exam 'rs in Optometry, 30 F.3d 1325 (10th Cir. 1994) Mother Goose v. Sendak, 770 F.2d 668 (7th Cir. 1985) Procter & Gamble Co. v. Haugen, 506 F. Supp. 2d 883 (D. Utah 2007) Ray v. Simmons, No. 03-3006, 2005 WL 2807362 (D. Kan. Oct. 26, 2005) Steinert v. The Winn Group, Inc., No. 98-2564-CM, 2006 WL 3028249 (D. Kan. Oct. 11, 2006) United States v. Husband, 312 F.3d 247 (7th Cir. 2002) United States v. Webb, 98 F.3d 585 (10th Cir. 1996) Ute Indian Tribe v. State of Utah, 114 F.3d 1513 (10th Cir. 1997) Volvo Trademark Holding Aktiebolaget v. Clark Mach. Co., 510 F.3d 474 (4th Cir. 2007) Wadley v. Equifax Info. Servs., LLC, 296 Fed. Appx. 366 (4th Cir. 2008) Werner v. Carbo, 731 F.2d 204 (4th Cir. 1984)

6 6 .4 6 7 6 6 5 7 6 6 .4

OTHER AUTHORITIES

Federal Rules of Civil Procedure Rule 60(b)

passim

sf-2789748

111

I.

PRELIMINARY STATEMENT seo concedes in its Opposition that Rule 60(b)( 5) authorizes relief from a judgment that seo also concedes that the

is "based on an earlier judgment that has been reversed or vacated."

district court rejected Novell's claim for SVRX Royalties based, at least in part, on a ruling that the Tenth Circuit recently reversed. seo nevertheless contends that reversal of that ruling does

not entitle Novell to relief from the judgment on Novell's SVRX claim ("SVRX judgment") because (1) the "mandate rule" prohibits use of Rule 60(b)( 5) to obtain relief from a judgment that a party has not appealed; and (2) other independent grounds support the SVRX judgment. seo's mandate rule argument is refuted by the plain language of Rule 60(b)( 5), which

explicitly authorizes relief from a judgment that is based on a ruling that has been reversed. This provision can apply only to a judgment that is still effective, meaning that it has not been overturned on appeal. Federal courts have unanimously held that Rule 60(b)( 5) authorizes relief from a judgment based on a ruling that has been reversed, even when the judgment was not appealed. seo' s cited cases are irrelevant because they either did not involve Rule 60(b)( 5) or did not involve a judgment based on a ruling that had been reversed. seo's argument that independent grounds support the SVRXjudgment is also without

merit. The district court held that the release in the Other SeOsource Licenses and the Microsoft Agreement did not constitute an "SVRX License" because seo did not own the UNIX did not own. This did not own the

copyrights, and thus could not release claims based on copyrights that seo holding was based squarely on the prior summary judgment ruling that seo

copyrights. The district court did not rely on any other ground that would independently support the SVRXjudgment. Therefore, the reversal of the summary judgment ruling that was the

essential predicate for the SVRX judgment entitles Novell to relief from that judgment.

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II.

THE MANDATE RULE DOES NOT NULLIFY THE COURT'S AUTHORITY UNDER RULE 60(B)(5) TO GRANT RELIEF FROM A JUDGMENT THAT IS BASED ON A RULING THAT HAS BEEN REVERSED. A. The Plain Language of Rule 60(b)(5) Authorizes Relief from a Final Judgment that Is Based on a Ruling that Has Been Reversed.

SCO admits, as it must, that "Rule 60(b)( 5) permits the Court to relieve a party from a final judgment 'based on an earlier judgment that has been reversed or vacated. ", (SCO's Opposition, Dkt No. 612 ("Opp."), at 10.) Nevertheless, SCO asserts that the so-called mandate rule nullifies this Court's Rule 60(b)(5) authority because Novell did not file an appeal to make the "conditional" argument that

if the

copyright ownership ruling were reversed, the SVRX

judgment should be reversed. SCO asserts that the mandate rule "prevents a party from having the district court consider an argument that the party could have made on appeal." (Opp. at 7.) SCO's argument fails because Rule 60(b)(5) explicitly carves out an exception to the binding nature of a final judgment. It authorizes relief from a judgment "based on an earlier

judgment that has been reversed or vacated." This provision can apply only to a judgment that has not been successfully appealed, as there is no need for relief from a judgment that has already been reversed. SCO' s argument that Rule 60(b)( 5) does not apply to an unappealed judgment would make this exception meaningless, violating the rule that "[a] statute should be construed so that effect is given to all its provisions, so that no part will be inoperative or superfluous." FDIC v. Canfield, 967 F.2d 443,447-448 (10th Cir. 1992) (citation omitted).

SCO asserts that Rule 60(b)(5) "does not trump the mandate rule, but rather is subject to it." (Opp. at 9.) Novell is not arguing, however, that Rule 60(b)(5) means that the mandate rule never applies. Rather, Novell contends that Rule 60(b)( 5) allows relief from an unappealed judgment in the unusual situation where the judgment is "based on" a ruling that has been reversed. The mandate rule still applies in other situations.

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Further, granting Rule 60(b)( 5) relief in this case does not conflict with the mandate rule because the Tenth Circuit did not decide whether such relief is proper. The Eighth Circuit addressed a similar issue in Jones v. Us., 255 F.3d 507 (8th Cir. 2001). On a prior appeal, the Eighth Circuit held that sovereign immunity required reversal of a prejudgment interest award and that "[t]he judgment must therefore be reduced by $2,560,081." Jones, 255 F.3d at 509-10. On remand, plaintiffs sought to reopen the judgment, arguing that the late assertion of sovereign immunity constituted "unfair surprise" under Rule 60(b)( 1), in that earlier notice of this defense would have enabled them to establish similar damages in a different manner. Id The district court held that the mandate required it to enter judgment in the specified amount. Id at 510. The Eighth Circuit held that its mandate did not bar consideration of the Rule 60(b) motion because it had not resolved the question of whether the government's late assertion of sovereign immunity constituted "unfair surprise." Id The Eighth Circuit noted that its prior opinion "does not explicitly settle the question." Moreover, "that issue simply could not have been before this court" in the prior appeal because the district court had rejected the sovereign immunity argument, so the plaintiffs previously "had no cause to raise a Rule 60(b) motion seeking relief from a judgment due to surprise." Id The Eighth Circuit explained: [A]n appellate court order resolving one issue, here that the award as originally ordered improperly included pre-judgment interest, does not strip the district court of other post-judgment authority, such as that granted by Rule 60(b). Certainly, the district court could not use its Rule 60(b) authority to ignore or reverse this court's mandate, but that mandate does not prevent it from entertaining the merits of such a motion. We therefore conclude that the district court had authority to visit the merits of the Joneses' motion. Id at 51 0-11 (emphasis added). Similarly, the Tenth Circuit did not address whether its reversal of the summary judgment that SCO does not own the UNIX copyrights entitled Novell to relief under Rule 60(b)(5). Novell had no reason to seek such relief before the Tenth Circuit reversal, as the district court

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had held that sca

did not own the copyrights.l

The Tenth Circuit opinion "does not strip the

district court of other post-judgment authority," such as its Rule 60 authority to grant relief from a judgment based on a ruling that has been reversed. See Jones, 255 F. 3 d at 510-11. B. Federal Courts Have Unanimously Held that Rule 60(b)(5) Authorizes Relief from an Un appealed Judgment Based on a Ruling that Has Been Reversed.

Federal courts have uniformly held that Rule 60(b )(5) authorizes relief from an unappealed judgment that is based on a ruling that has been reversed. The Fourth Circuit held that when a judgment against a physician was reversed, but the judgment against the physician's corporation was not appealed or reversed, denying the corporation's motion for Rule 60(b)( 5) relief was an abuse of discretion. Werner v. Carbo, 731 F.2d 204, 206-09 (4th Cir. 1984)? Similarly, the Ninth Circuit held that reversal of a liability judgment entitled a defendant to relief from a related attorney fees award that defendant had not appealed. California Med Ass 'n v. Shalala, 207 F.3d 575, 576-78 (9th Cir. 2000). The Ninth Circuit explained: The text of Rule 60(b)(5) supports this approach. The Rule provides that "[o]n motion and upon such terms as are just, the court may relieve a party ... from a final judgment ... [if] a prior judgment upon which it is based has been reversed or otherwise vacated." Fed. R. Civ. P. 60(b). As the district court noted, "Rule 60(b)(5) appears to contemplate exactly the type of motion brought here." Since the fee award is based on the merits judgment, reversal of the merits removes the underpinnings of the fee award. Were we to accept the [plaintiff s] argument that Rule 60(b)( 5) is inapplicable here, we would be hard pressed to figure out where it ever would apply. Id at 577-78 (emphasis in original). The Fifth and Seventh Circuits have reached the same conclusion. Flowers v. S. Reg'l Physician Servs., 286 F.3d 798, 799-802 (5th Cir. 2002); Mother Goose v. Sendak, 770 F.2d 668,675-76 (7th Cir. 1985). sca asserts that Novell should have filed a "protective cross-appeal," but has cited no Rule 60(b)( 5) case requiring such an appeal when, as here, the party does not dispute the basis for the judgment.
1

sca attempts to distinguish Werner on the ground that the failure to appeal was "inadvertent" (app. at 10 n. 1), but the Fourth Circuit expressly relied on Rule 60(b)(5), and not on "mistake, inadvertence, surprise, or excusable neglect" under Rule 60(b)(I). Werner, 731 F.2d at 207.
2

4

In sum, the Fourth, Fifth, Seventh, and Ninth Circuits have all held that Rule 60(b)(5) authorizes relief from a judgment that has not been appealed but that is based on a ruling that has been reversed. Further, the Eighth Circuit has held that the mandate rule does not bar consideration of a Rule 60(b) motion when the appellate court did not address whether such relief should be granted. The Tenth Circuit has not addressed this issue, but there is no reason to deviate from the uniform holding of the other circuits.

c.

SCO's Cited Cases Do Not Hold that the Mandate Rule Nullifies the Court's Rule 60(b)(5) Authority to Grant Relief from a Judgment that is Based On a Ruling that Has Been Reversed. cited cases are inapposite. (See app. at 7-10 (relying on "mandate rule" cases and

sca's

"independent" cases.) Most do not involve Rule 60(b)( 5), and sca' s few Rule 60(b)( 5) cases do not involve a judgment based on a ruling that has been reversed. 1. sca Cases that do not involve any provision of Rule 60(b) are irrelevant.

places the most reliance on United States v. Webb, 98 F.3d 585 (10th Cir. 1996).

Webb involved a criminal defendant who failed to challenge his conviction or sentence on appeal, but attempted to do so after the Tenth Circuit vacated the sentence as too lenient and remanded for sentencing under the applicable guidelines. Id at 586, 588-89. Defendant did not seek relief from judgment under Rule 60(b)( 5) or any other provision, and Rule 60(b)( 5) did not apply as the portions of the judgment that the defendant belatedly sought to challenge were not based on any rulings that the Tenth Circuit had reversed. See id Thus, that decision has no bearing here. Many of sca' s other cases also did not involve any provision of Rule 60(b) or a

judgment based on a ruling that had been reversed. See Fox v. Mazda Corp. of Am., 868 F.2d 1190, 1192-95 (10th Cir. 1989) (remand for retrial on one damage theory supported exclusion of evidence that "went well beyond" that theory; no Rule 60(b) motion); Huffman v. Saul Holdings Ltd P'ship, 262 F.3d 1128,1131-33 (10th Cir. 2001) (appellate court's rejection of appellant's

5

request for attorney fees precluded district court from awarding such fees on remand; no Rule 60(b) motion); Procter & Gamble Co. v. Haugen, 506 F. Supp. 2d 883,886-87 (D. Utah 2007) (appellate decision that "commercial speech" element of a four-part test was met, but remanding for consideration of other factors, barred reconsideration of that element; no Rule 60(b) motion)? 2. sca Cases that involve Rule 60(b)(1), (4), and (6) are irrelevant.

also relies on cases that involve a different provision of Rule 60(b) and thus do not

address whether the mandate rule nullifies the Rule 60(b)( 5) authority to grant relief from an unappealed judgment based on a ruling that has been reversed. For example, Ackerman v. United States, 340 U.S. 193, 197-202 (1950), and Colorado Interstate Gas Co. v. Natural Gas Pipeline Co. of Am., 962 F.2d 1528, 1533 (10th Cir. 1992), both involved Rule 60(b)(6), which is a "catch-all" that authorizes relief for "any other reason justifying relief from operation of the judgment." By its terms, Rule 60(b)( 6) applies only if Rule 60(b)( 5) does not apply. Several are likewise irrelevant because they involved different provisions of

other cases cited by sca

Rule 60(b). See Cashner v. Freedom Stores, Inc., 98 F.3d 572,576-80 (10th Cir. 1996) (relief from judgment for "mistake" under Rule 60(b)(1), and "any other reason" under Rule 60(b)(6)); In re PettIe, 410 F.3d 189, 192-93 (5th Cir. 2005) (same)); Massengale v. Okla. Bd of Exam 'rs in Optometry, 30 F.3d 1325, 1330 (10th Cir. 1994) (administrative board's denial of disqualification request does not constitute "exceptional circumstances" warranting Rule 60(b) relief from judgment based on failure to exhaust administrative remedies); Wadley v. Equifax

The following additional cases cited by sca are irrelevant because there was no Rule 60(b) motion or basis for such a motion: Doe v. Chao, 511 F.3d 461,466-67 (4th Cir. 2007); Volvo Trademark Holding Aktiebolaget v. Clark Mach. Co., 510 F.3d 474,476-81 (4th Cir. 2007); United States v. Husband, 312 F.3d 247,248-52 (7th Cir. 2002); Bethea v. Levis Strauss & Co., 916 F.2d 453,454-57 (8th Cir. 1990); Steinert v. The Winn Group, Inc., No. 98-2564-CM, 2006 WL 3028249 (D. Kan. act. 11,2006); MacArthur v. San Juan County, 391 F. Supp. 2d 895,920 n.35 (D. Utah 2005).
3

6

Info. Servs., LLC, 296 Fed. Appx. 366, 368 (4th Cir. 2008) (unpublished) (denying relief from a "void" judgment under Rule 60(b)( 4)). 3. The Rule 60(b)(5) cases relied upon by sea do not involve a judgment that is based on a ruling that has been reversed.

The few Rule 60(b)( 5) cases cited by SCO are inapposite because they do not involve a judgment based on a prior ruling that has been reversed. Lubben v. Selective Servo Sys. Local Ed, 453 F.2d 645,650 (1st Cir. 1972), merely states that Rule 60(b)(5) applies only when a judgment that is the basis for the judgment at issue has been reversed, and not when the governing law has been overruled in an unrelated case.4 This principle does not help SCO, as Novell relies on reversal of an underlying judgment, and not on a change in the applicable law. Similarly, Cruikshank & Co. v. Dutchess Shipping Co., 112 F.RD. 4 (S.D.N.Y. 1986), does not support SCO because the judgment at issue was not based on a judgment that had been reversed. Rather, the judgment was based on the fact that the corporate defendants that owned and managed a ship "made a considered default as to liability and then made a considered decision not to appeal." Id at 5, 7. When the Second Circuit reversed the judgment against the ship captain, the corporate officers sought to vacate the default judgment against the corporate defendants, relying on the Fourth Circuit decision in Werner. Id at 6. The district court denied relief, emphasizing that "the identity of interest between the corporate defendants and [the ship captain] is far less than that of a doctor to his professional corporation." Id at 7. The court also noted that the Second Circuit's reasoning in reversing the judgment against the captain "is not applicable to the corporate defendants." Id at 8. The default judgment against the corporate defendants was thus not based on any ruling that the Second Circuit had reversed.
4

See also Ray v. Simmons, No. 03-3006,2005 WL 2807362 (D. Kan. Oct. 26, 2005) (change in state law does not warrant Rule 60(b) relief because "new" case decided before judgment affirmed, and was thus presumably considered by appellate court); Ute Indian Tribe v. State of Utah, 114 F.3d 1513, 1522 (10th Cir. 1997) (change in law does not warrant recalling mandate).

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Coltec Indus., Inc. v. Hobgood, 280 F.3d 262,274-75 (3d eir. 2002) Rule 60(b)( 5) case -

seo's

only other

is irrelevant because it involved a different clause of Rule 60(b)( 5), which

applies when "it is no longer equitable that the judgment should have prospective application." III. NOVELL IS ENTITLED TO RULE 60(B)(5) RELIEF BECAUSE THE SVRX JUDGMENT WAS BASED ON THE SUMMARY JUDGMENT RULING THAT WAS REVERSED, AND NOT ON INDEPENDENT GROUNDS. seo seo does not dispute that Judge Kimball relied on his summary judgment ruling that

did not own the SVRX copyrights in concluding that the Other SeOsource Licenses and

the Microsoft Agreement (collectively, "the SeOsource Agreements") did not constitute "SVRX Licenses" because seo could not license copyrights that seo did not own. (See July 16, 2009 contends

Order, Dkt. No. 542, at 31; Novell's Motion, Dkt. No. 609, at 4.) Nevertheless, seo that the SVRXjudgment

is not "based on" the summary judgment ruling under Rule 60(b)(5)

because Judge Kimball relied on several independent grounds. This argument lacks merit. 5 A. seo The Fact that the SCOsource Agreements Involved a Release Does Not Independently Support the SVRX Judgment. contends that Judge Kimball's finding that the SeOsource Agreements involved a

release of claims rather than a product license is an independent basis for the SVRX judgment. However, Judge Kimball made clear that this was a preliminary finding only, and not a sufficient basis by itself. After noting that the SeOsource Agreements involved a release, Judge Kimball reviewed the details of that release to "determin[e] whether the SeOsource Agreements constitute SVRX Licenses." (July 16,2009 Order, Dkt. No. 542, at 28.) This review would have been unnecessary if, as seo contends, the fact that these agreements involved a release were a

sufficient basis for rejecting Novell's claim.

5 seo focuses on the "based on" element and does not dispute Novell's showing that the other Rule 60(b) conditions are met (timely, no unfair prejudice, meritorious, and "exceptional circumstances" shown by meeting Rule 60(b)(5)). (See Novell's Motion, Dkt. No. 609 at 6-10.)

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Judge Kimball noted that the SeOsource Agreements involve "a license to use seo IP," which includes UNIX System V and would thus "appear to include SVRX." (Id at 28-29.) However, "[b ]ased on this court's ruling that SVRX copyrights were not included in the assets ... transferred from Novell ... , seo infringement of SVRX technologies." could not enter into any release for copyright (Id at 30.) Judge Kimball concluded that "[b ]ecause the

SeOsource licenses cannot be construed to include a release of SVRX copyright infringement, the court does not find the licenses to be SVRX Licenses that generated SVRX Royalties to Novell under the AP A" (Id at 31.) Thus, Judge Kimball held that the SeOsource Agreements were not "SVRX Licenses" because (1) they involved a release; and (2) the release could not grant any rights to SVRX because seo did not own the SVRX copyrights. Both of these reversal of the copyright ownership

findings were necessary elements of the SVRXjudgment; ruling removes an essential predicate for that judgment. B.

Judge Kimball's Finding that the SCOsource Agreements Were Limited to UnixWare Was Based on His Ruling that SCO Did Not Own the SVRX Copyrights. contends that the SVRXjudgment is independently supported by Judge Kimball's

seo

finding that the Other SeOsource Agreements were limited to UnixWare and did not include Unix System V ("SVRX"). But Judge Kimball clearly based this finding on his ruling that seo

did not own the SVRX copyrights (July 16,2009 Order, Dkt. No. 542, at 29): seo IP is defined in the agreements to include UNIX System V, which would appear to include SVRX. But given the terms of the amended AP A between Novell and seo, as this court has previously ruled, the SVRX copyrights did not transfer to seo. Therefore, seo IP cannot include SVRX and can only mean seo UnixWare. seo quotes Judge Kimball's summary of evidence that seo presented. (Opp. at 12.)

However, Judge Kimball did not accept that evidence as proving that the SeOsource Agreements were not SVRX Licenses. Rather, his conclusion (which seo omits) was that "there was

9

evidence that the SeOsource program was not solely focused on older System V technology." (July 16, 2009 Order, Dkt. No. 542, at 30 (emphasis added).) Judge Kimball then found that the claims released in the SeOsource Agreements "were only those claims seo was entitled to bring," and that seo could not grant a license to SVRX since it did not own the copyrights. (Id

at 30-31). This conclusion was based on the copyright ownership ruling. C. Judge Kimball's Finding that the License in Section 4 of the Microsoft Agreement Is "Incidental" to a UnixWare License Has No Bearing on Whether the Release in Section 2 Constitutes an SVRX License. contends that Judge Kimball's finding that the SVRX license in Section 4 of the

seo

Microsoft Agreement is "incidental" to a UnixWare license is an independent ground for the SVRXjudgment. Agreement. (Opp. at 13.) Novell agrees, but only as to Section 4 of the Microsoft

This is critical because Novell is not seeking relief from judgment as to Section 4,

which provided an option to license UnixWare, OpenServer, and other SVRX for a separate payment. (See July 16,2009 Order, Dkt. No. 542, at 16, 32.) Rather, Novell is seeking relief as to the release in Section 2 of the Microsoft Agreement (which involved a separate payment of $1.5 million), and the similar release in the Other SeOsource Licenses. (See id at 15-16,21-22.) Judge Kimball's analysis of Section 4 is separate from Section 2, and does not support his ruling that the Section 2 release of claims did not constitute an SVRX License. (See id at 31-34.) IV. CONCLUSION The basis for Judge Kimball's judgment that the release in the SeOsource Licenses and in Section 2 of the Microsoft Agreement did not constitute an "SVRX License" was his ruling that seo did not own the SVRX copyrights and thus could not release claims that seo did not

own. The Tenth Circuit's reversal of that ruling is a new development that entitles Novell to Rule 60(b)(5) relief because the SVRXjudgment is based on a ruling that has been reversed.

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DATED: January 22,2010

Respectfully submitted, By:

Isl Sterling A. Brennan
MORRISON & FOERSTER LLP Michael A. Jacobs, pro hac vice Eric M. Acker, pro hac vice Grant L. Kim, pro hac vice WORKMAN NYDEGGER Sterling A. Brennan David R. Wright Kirk R. Harris Cara 1. Baldwin Attorneys for Defendant and Counterclaim-Plaintiff Novell, Inc.

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