## Facts

- Novell acquired UNIX System V intellectual property in the early 1990s, including valuable SVRX source-code licenses that generated substantial royalties.
- In 1995, Novell sold much of its UNIX business to Santa Cruz Operation (SCO’s predecessor) under an Asset Purchase Agreement (APA), while retaining a 95% interest in SVRX license royalties.
- The APA transferred specified UNIX-related assets but listed “all copyrights and trademarks” as excluded assets, while including UNIX trademarks as transferred.
- Amendment No. 2 later revised the exclusion to except those copyrights “required for [Santa Cruz] to exercise its rights” in the acquired UNIX business, without updating the schedules identifying included assets.
- Years later, SCO publicly asserted it owned the UNIX copyrights and sought to enforce rights through licensing efforts; Novell publicly disputed SCO’s ownership.
- SCO sued for declaratory relief on copyright ownership and asserted slander of title and related theories based on Novell’s ownership statements; Novell asserted counterclaims and contended SCO had duties in administering SVRX licenses given Novell’s retained royalty interest.
- The district court granted summary judgment largely for Novell, holding the agreements did not transfer the UNIX copyrights to SCO and disposing of key claims dependent on ownership.

## Issues

1. Whether the APA and its amendments unambiguously left UNIX copyright ownership with Novell, justifying summary judgment.
2. Whether Amendment No. 2’s “required for [Santa Cruz] to exercise its rights” language created contractual ambiguity requiring consideration of extrinsic evidence and jury resolution.
3. Whether summary judgment was proper where the parties offered competing reasonable interpretations and conflicting evidence of intent.
4. To what extent Novell retained contractual rights regarding administration of SVRX licenses in light of its retained royalty interest.

## Decision

- Affirmed in part, reversed in part, and remanded.
- Reversed the district court’s summary judgment determination that Novell retained UNIX copyrights as a matter of law.
- Held the agreements, read together, were ambiguous regarding which copyrights (if any) transferred under Amendment No. 2’s exception.
- Concluded conflicting extrinsic evidence created genuine disputes of material fact on ownership and the parties’ intent, requiring trial.
- Affirmed certain other rulings narrowing remaining disputes, including aspects of Novell’s contractual rights tied to SVRX license administration.

## Legal Principles

- Related agreements and amendments forming a single transaction must be construed together to determine contractual meaning.
- When contract language is reasonably susceptible to more than one interpretation, it is ambiguous and intent may be resolved using extrinsic evidence.
- Summary judgment is improper where ambiguity and conflicting evidence create genuine disputes of material fact on a material contractual issue.
- Contractual reservations of economic interests (such as retained royalty rights) may support retained supervisory or directive rights over performance obligations defined in the agreement.

## Conclusion

The Tenth Circuit held that the asset-sale documents did not unambiguously resolve UNIX copyright ownership because Amendment No. 2 introduced an exception capable of competing reasonable interpretations; with conflicting evidence of intent, the ownership dispute and dependent claims required jury factfinding, so the court reversed summary judgment on ownership and remanded while affirming other portions of the district court’s rulings.


The SCO Group, Inc. v. Novell, Inc., 578 F.3d 1201 (10th Cir. 2009)