Darl McBride, the Man Nobody Bothers to Hate, and His Buddy Mike Anderer Cook Up a Scheme

by Pamela Jones

June 23 2004

I think you'll want to read this one, an article on SCO [ http://www.wired.com/wired/archive/12.07/linux.html ] in Wired by Newsweek reporter Brad Stone. You will have to pick your way through a lot of the usual warmed up leftover SCOFUD that SCO always feeds reporters, who dutifully report it as if true, starting with the title ("The Linux Killer" ... yeah, right, and how Darl is the most hated man in tech, blah blah -- I don't know anyone who takes him seriously, let alone hates him), but it's worth it, because the reporter managed to dig up some new information about the Mike Anderer connection, which clarifies the motives behind the IBM lawsuit, at least in my eyes. It was a patent-pool hustle, judging from this article, from two guys who have a history together doing just that. Is there any way the decision-makers who hired Darl did not know his history? Might it even have been the reason he was brought on board from day one?

First, he details the friendship between Darl McBride and Mike Anderer, which goes back to the 90s. Seems they've tried the "we have no business but threatening to sue over IP" before, in a "business" they set up together after Darl got fired by Ikon Office Solutions. It looks like the two cooked up the "Let's try suing IBM and maybe they'll pay us to stop" scheme together, with Anderer playing a larger role than was previously publicly known. The two met, according to Stone, when Darl was still with Ikon and he arranged to buy Anderer's company, the Computer Group, a South Carolina company that sold Novell products to businesses. Anderer went with the company to Ikon and he and Darl worked closely together from then on.

Anderer started his own company, Silicon Stemcell, and asked McBride to join him there as a consultant. They began their efforts to turn IP into gold at Silicon Stemcell, which I gather was more a patent pool than a business:

"It was 1999, and they were in the business vanguard, devising a new way to create wealth. Something as intangible as a claim to owning an idea, they realized, could be used to extract money from innovators in related fields. Even if Silicon Stemcell's patents weren't finalized, it might still be cheaper for startups to pay licensing fees to Anderer's group than to fight protracted legal battles. Silicon Stemcell wouldn't even have to create businesses, it could thrive just by collecting these fees."

When Darl joined SCO, he in turn hired Anderer as a consultant, and the rest is history. Anderer:

"He expresses surprise that IBM didn't simply purchase SCO and donate the Unix code to the public domain; it would've been much cheaper than the current legal fracas."

I should mention that some people think patent pools are a great way to make money. In the 90s it was all the rage. I think of it as the ultimate IP fantasy -- a way to ruin everything that matters, for money. It's a form of IP piracy, if you think it through. By everything, I mean innovation, a fair marketplace, etc., all made possible by a broken patent system and OldThink. And greed, wanting to make money by hustling people. That's what patent pools [ http://www.informationweek.com/story/IWK20021020S0002/1 ] do. They file for patents, build up a portfolio and then pounce on anyone who is successful by announcing they are violating their patents and threatening to sue. Kind of like pirates stopping your ship and demanding you pay them or you can't go on your way in peace.

Most people will pay rather than go through a costly lawsuit, and in fact Silicon Stemcell got some companies to pay up without even having to actually file a lawsuit. It's a mockery of what patents are allegedly for, a parasitism on the body of the patents system, but it's legal. Smarmy but legal, in that it's a working of the system in a calculated way, taking advantage of the system's weaknesses. The advantage is that the patent pool can't be sued back, because they don't care. They don't have any products, no good will, nothing to lose. That's why I think Microsoft will likely use a patent pool company to bring a patent lawsuit someday against GNU/Linux.

The article also indicates that Darl is fibbing when he claims that he decided to sue when IBM announced at LinuxWorld in January of 2003 it had ported AIX code to Linux. In fact, the article points out, it was the day before the speech that SCO hired Boies. Now that we know the rest of the story about the Anderer connection, I have real questions in my mind if the decision to try it wasn't the reason he was brought on board in the first place, which brings up the old question about all those insider stock plans and when folks knew that there would be such a lawsuit.

The article portrays the friendship as being over, with Anderer allegedly thinking about suing SCO for the money it didn't pay him for getting Microsoft to intervene in the BayStar deal.

Goldfarb is quoted again, and every time he opens his mouth, he shows what a sensitive, complex guy he isn't:

"Did I know, after looking at SCO, that of course Microsoft would find the funding of this company to be a good thing for Microsoft? Well, duh," says Goldfarb. "I knew Microsoft's motivation, but if I can make a dollar where I wouldn't otherwise, why should I be concerned?"

Charming, no? Why indeed? Er...because it's immoral to try to steal other people's IP? Maybe because you might be funding a ripoff of other people's code in what could turn out to be a fraud? Even folks thinking only of the bottom line might care about that. If you can't get enough of Goldfarb, here's an interview [ http://www.baystarcapital.com/public/pdf/The%20PIPEs%20Report%20-%20October%201%202003.pdf ] he did about PIPE deals just before he invested in SCO. He says that if you invest in shady management, you can expect bad things to happen. Hmm. From his lips to God's ears.

But here's the part you will like. The article says that what Goldfarb didn't like, causing him to ask for his money back, was that Darl was exchanging fire in the press with "multiple members of the open source intelligentsia and was badly outmatched." His letter to Congress and open letters were "feebly argued" and "the rabid anti-SCO community on the Net eagerly dismembered them".

Why I do believe he means moi. I don't answer to "rabid anti-SCO community" name-calling, but I'm glad to know it is now established that we dismembered them.

Here's the key to Goldfarb's unhappiness: because of all that, the stock price went down. The guy is like an animal after meat. Nothing distracts him from his money. And catch this: he consults with his "good friend" Boies every week and has high hopes for the lawsuits. That's not what I've heard, the friend part, and I don't believe the second part. The Wired reporter doesn't seem to share his professed assessment of the likelihood of a SCO win, and he adds that even if SCO "wins" in court, the community will just rip out any infringing code and move on, so his dream of money from a Linux toll is a hopeless dream. He definitely got that right. The reporter didn't note that so far, SCO has been unable to show any serious infringement of any kind, has not sued any primary copyright infringer anywhere on planet earth, and that so far as anyone can tell, Linux is as pure as the driven snow.

Um... all these SCOfolk talking to this reporter and trotting out the old FUD about guns and the Microsoft connection and how BayStar is now bullish on the lawsuits after all wouldn't have anything to do with that stock price now, would it?

Thomas Getz writes some nonsense [ http://www.wired.com/wired/archive/12.07/linux.html?pg=1&topic=linux&topic_set= ] about copyrights as a sidebar. He repeats the nonsense about the FSF forcing copyright transfers, for example, which is simply wrong.

You might also want to check out Tim Lambert's Deltoid, which has a list of think tanks [ http://www.cse.unsw.edu.au/~lambert/blog/computers/tanks.html ] that have been attacking Linux, 14 of them, all funded by Microsoft or connected in some other way. Five of them run on Linux, though. Not one of them, he writes, mentioned they were funded by Microsoft when releasing their think tank fluff. FUD only works in the dusk, not in sunshine, of which there is an abundance on the worldwide web. The WWW, brought to you by free and open source.

03:39 PM EDT

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