Forget the ‘no win, no fee’ approach to legal costs. It is time for lawyers to embrace the ‘no win, no stock grant’ engagement. And it might be bad news for users of the Linux operating system.
SCO Group – the owner of one of the most popular Unix kernels (System V) that claims that Linux contains its intellectual property – is going up a gear in its pursuit of licence fees for servers running the open source operating system. It is preparing to launch legal action against a big enterprise user.
SCO did not say if it has a particular organisation in mind, or whether it would withdraw the threat if it becomes more successful at securing licence fees from Linux users. But the lawyers representing SCO – Boies, Schiller &Flexner – said the plan was to pursue a test case that could lead to more suits.
Some critics have questioned the seriousness of SCO’s intent in its apparent determination to extract licence fees from Linux users and secure compensation from Linux distributor IBM for allegedly stealing its secrets. But SCO is to pay Boies, Schiller &Flexner and its other legal representatives $1 million in cash and about $8 million in shares. The payment will give the lawyers a 2% to 3% share in SCO. Overall, Boies, Schiller &Flexner’s will get 20% of any potential settlement awarded to SCO.
The revelation suggests the law firm has a stronger than usual incentive to pursue – and win – a legal case for SCO, since that would help keep its shares buoyant.