Details of a controversial patent agreement between Microsoft and Novell have been revealed in Novell's SEC filings. The text of the agreement is now publicly available, but some parts—including one whole page—have been redacted.
Although most of the details surrounding the agreement have already been disclosed, there are a few aspects of the deal that weren't previously known. Of particular interest is the language that describes exceptions to the patent indemnification agreement. The deal specifically excludes patent protection for "clone products." In the agreement, a clone product is broadly defined as "a product (or major component thereof) of a Party that has the same or substantially the same features and functionality as a then-existing product (or major component thereof) of the other Party ... and that has the same or substantially the same user interface, or implements all or substantially all of the Application Programming Interfaces of the Prior Product."
This means that Microsoft can still sue individual SUSE Linux customers who are using products designed to replicate Microsoft products and that also infringe on Microsoft's patents. The text of the clone product definition subsections is very cumbersome to read, but it specifically mentions OpenOffice, Wine, and OpenXchange by name without asserting that they are necessarily clone products. It leaves the door open for possible suits. One can speculate that this is perhaps the fertile field of patent infringements that Microsoft keeps mentioning but never specifying.
The SEC filing also includes an extremely broad list of potential risks faced by Novell. One particular item in that list, which deals with the GPL 3, has garnered a lot of unwarranted attention. In the text of the filing, Novell acknowledges that the terms in the GPL 3 could potentially cause Novell's business to "suffer harm" and that it could potentially prevent Microsoft from distributing SUSE Linux certificates or prevent Novell from distributing code licensed under version 3 of the GPL.
Despite what some critics seem to believe, these references to potential GPL 3 threats in the SEC filing don't really validate or confirm the theory that the GPL 3 will affect Novell's business in the suggested manner. The SEC filing is addressing all perceived threats regardless of the credibility of those threats. For instance, the same page that discusses the possibility of GPL-related threats also acknowledges that "a lawsuit filed against [Novell] by SCO could result in a substantial judgment against [Novell] and adversely affect [Novell's] revenue and business plan if SCO is successful." We all know that SCO isn't going to win, but the possibility is listed anyway. Clearly, the references to GPL-related threats in Novell's SEC filling should not be interpreted as evidence that Novell is concerned about the GPL 3.
Most of the contents of the filing, particularly the 10-K form, are extremely boring. Aside from the text of the patent agreement, the filing really doesn't contain much that is relevant to people who aren't investing in Novell. Nevertheless, the "clone" exception is an interesting one, and we hope to hear from Microsoft and Novell on what exactly constitutes "clone" software in their views.
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