UPDATE: A New York-based startup is preparing to offer “open source insurance” to
some of the largest corporations in the world in response to legal concerns
like the one being played out by
SCO Group.
Open Source Risk Management, which provides consulting services as well
as vendor-neutral indemnification to clients, is expected to debut an
expanded range of business services this week, including insurance
against open source litigation. After several months in stealth mode, the
VC-backed company is officially launching at this week’s Open Source
Business Conference in San Francisco.
Already, OSRM has support from top open source leaders, including Eric Raymond,
Bruce Perens and Richard Stallman, as well as Groklaw creator Pamela Jones, who
has signed on as a director of research. While OSRM executive director John St. Clair said the client list remains confidential, the firm has approached Fortune 500 companies
like Charles Schwab.
The need for protection is clear. Linux is the fastest-growing operating
system worldwide; but lawsuits like SCO’s threaten its viability. And what
has happened to Linux could easily spill over to other open source
Clair. Beyond basic copyright litigation, OSRM says there are also the legal
land mines of patent claims, as well as claims of unfair competition and
collusion on trade secrets.
“That is where open source is headed, if not there already,” John
St. Clair said. “There are some opportunities to provide clarity in the market with
our company. People by and large are forging ahead with their distributions,
but enterprise end users are concerned about moving forward. The question
they pose to us usually is, ‘Does this represent the first of many
incidents? Is SCO a one-off, or is this part of a patent problem?'”
SCO is involved in legal battles over Linux with IBM and
Novell, and is seeking licensing fees from European users, as well as
Daimler-Chrysler and online automotive parts distributor Autozone. It’s
important to note that SCO hasn’t yet won any cases in court that clearly
give it the right to extract fees from Linux users. If patent problems do
materialize, open source advocate Bruce Perens predicts they would happen
after SCO’s Linux lawsuits have worked their way through the legal system.
“So far, I like the concept of insurance rather than indemnification, but
I don’t want this to seem to be a reaction to SCO,” Perens told
internetnews.com. “SCO will go away whatever we do, they seem to be
on the way out already. Without SCO in the picture, risk management is still
a desirable thing for some companies. And it’s not a problem unique to Free
Software.”
OSRM founder Daniel Egger is expected to highlight the company’s
offerings during a panel discussion about the legal issues surrounding open
source on Wednesday.
Editor’s note: OSRM executive director John St. Clair was incorrectly quoted in a previous version of this story.
