IBM, which is among the largest firms pushing the open-source Linux operating system, was slammed with a $1B USD lawsuit in 2003 from SCO, one of the owners of a Unix distribution. The lawsuit alleged that IBM ripped off Linux code from the Unix codebase and was "devaluing" it.  

The damages eventually swelled to $5B USD, but SCO was defeated when Novell was shown to hold most of the applicable Unix intellectual property and Novell waived the case.  In the end, SCO filed for bankruptcy, and the Novell loss resulted in a ruling that SCO owes Novell $2.35M USD for copyright infringements (a total later bumped to $3.4M USD).

Even as SCO is appealing [PDF] that decision, Kevin McBride, a lawyer and brother of former SCO CEO Darl McBride has released [see comments section] a wealth of documents showing some of the code that SCO claimed IBM's Linux ripped off.

He writes:

While UNIX ownership rights are still not finally settled (pending SCO’s appeal of Novell’s jury victory in March, 2010) it is certainly my view, after careful review of all these issues, that Linux DOES violate UNIX copyrights, particularly in ELF code and related tools (debugger code, etc.), header file code wherein implementation code (not just the header interface) have been copied verbatim; STREAMS code; etc. that the Linux community use without license. Then there is the entire question of the overall structure and sequence of Linux being almost an exact copy of UNIX.

There should be little question by anyone at this point that Linux uses a LOT of UNIX code. The Linux world thinks that use is permissive. SCO disagreed. That is the only real issue to be discussed here.

Will Novell win the current SCO appeal? Probably. Will Novell donate the UNIX copyrights to the Linux community if it wins the current appeal? Probably–although Novell’s Linux activities have been difficult to predict in recent years. But does Linux violate UNIX copyrights? Yes.

So, in my opinion, Linux users owe Novell–and particularly its excellent Morrison & Forrester legal team–a huge debt for coming to the rescue and keeping Linux a royalty-free product.

And follows up:

SCO submitted a very material amount of literal copying from UNIX to Linux in the SCO v. IBM case. For example, see the following excerpts from SCO’s evidence submission in Dec. 2005 in the SCO v. IBM case:

Tab 422; Tab 421; Tab 420; Tab 419; Tab 418; Tab 417; Tab 416; Tab 415; Tab 414; Tab 413; Tab 412; Tab 411; Tab 410; Tab 409; Tab 333; Tab 332; Tab 331;Tab 330; Tab 329; Tab 255; Tab 254; Tab 253; Tab 252; Tab 251; Tab 250; Tab 249; Tab 248; Tab 247; Tab 246; Tab 245; Tab 244; Tab 243; Tab 242; Tab 241;Tab 240; Tab 239; Tab 238; Tab 237; Tab 236; Tab 235; Tab 234; Tab 233; Tab 232; Tab 231; Tab 230; Tab 229.

There was MUCH more submitted in the SCO v. IBM case that I cannot disclose publicly because it is comparison of code produced by IBM under court protective order that prohibits disclosure.

But the court in SCO v. IBM will probably never decide whether use of this (and all the other UNIX code) in Linux was, or was not permissive, because in the SCO v. Novell case, the jury decided in March 2010 that Novell owns the UNIX copyrights, not SCO.

As I mentioned in the reply to Andreas, if you Linux guys want to give credit where credit is due, you should all thank Novell for having the courage to take the case all the way to trial (I thought SCO had a much stronger case the on ownership question) and its legal counsel, Morrison & Forrester, for doing an outstanding job for Novell at trial–Michael Jacobs, Eric Acker and Sterling Brennan.

In case those links no longer work, you can also get a collected archive of the PDFs here.

Looking briefly at the code involved some of it indeed appears to be copied and pasted, or at least designed using common design documents.  The fact that so many named variables match up would certainly indicate that.  However, the order of the code has been rearranged and there have been numerous deletions and insertions in these sections.

Further, some of the segments of code included are pretty generic.  In these cases it is harder to tell whether the code was indeed copied as claimed, or just implemented similarly.

Ultimately, whether the code was copied or not may prove a moot point, as the jury trial resoundingly declared Novell to own the Unix code.  And Novell is not interested in suing IBM at the present.  Unless SCO's appeal, filed in U.S. Federal 10th Circuit on July 7, 2010 succeeds, this leak may merely prove an interesting footnote in this case, which is of extreme importance to the open source movement.