An Answer to the Indemnification FUD

GROKLAW ^ | 16 August 2003

[ShadowAce]

Tech Ping

[rdb3]

The Penguin Ping.

Wanna be Penguified? Just holla!

Click and find out!

Got root?

[demlosers]

bump...for later read

[WL-law]

Good article, and I generally agree, but there are some errors by the author in understanding the indemnification language in the excerpted contract.

I knew indemnification was the new FUD, and just because Ms DiDio said it was needed it, I was mightily sure I didn't want it. But now I also don't want it because you get virtually nothing for your money. Look at these terms.

The contract language, it's true, strongly limits the protection as between Caldera and their customer (i.e., the two contract parties), but the language requires Caldera to fully, and presumably without limit, indemnify the customer with regard to any damages owed to the 3rd party (the initiator of the infringement action).

So the indemnifcation has more 'value' than the author here admits.

[Coral Snake]

The Coral Snake Ping.

Calling all Anti Commies and Anti Pirates

Arron's Rod, America!!!

[Golden Eagle]

If there is infringement, whether patent or copyright-related, you can rip out the offending code yourself and move on.

Well, unfortunately, you can't just "move on" because there's that little issue known as damages. Since your Linux vendor gave you the software - without any protection at all - they can testify in court that they aren't liable, and would be correct. So, indemnification is important, especially if you have a lot of users.

[Coral Snake]

If you saw my first post here I desided to be the "pinger"
for our little group as I think my screen name critter draws the most attention of the four. By the way Mr McBride
and Mr. Sauntag have started releasing some of the stolen code outside the NDA. I read about that here.

http://zdnet.com.com/2100-1104_2-5065286.html?tag=fdfeed

[Golden Eagle]

"We're fighting for the right in the industry to be able to make a living selling software".

Not much hope for that if you follow Mr. Stallman, who insists EVERYTHING must be free.

[TheEngineer]

I knew indemnification was the new FUD...

I'm an occasional Linux user, and it would never occur to me to ask for indemnification from any of the struggling Linux companies. But the cheapskates in "the community" obviously have an insatiable demand for free stuff from the likes of RedHat, Mandrake, SuSe, etc.

So who's beating this dead horse? Other Linux proponents, no less.

The Canadian article that this unknown author referenced was by a Linux proponent:

For a start, the Linux community should move quickly on the following issues:

- Anyone who packages Linux in their products should indemnify their customers from any intellectual property issues. This would remove a significant part of the FUD (fear, uncertainty and doubt) factor that arises whenever lawsuits are launched. System suppliers would be leaving themselves open to legal attacks but the alternative, exposing the end user to such attacks, is the greater evil.

So, basically, the so-called 'FUD' is a self-inflicted wound as far as I'm concerned.

[TheEngineer]

ShadowAce, I didn't see an author listed for this article. Who wrote it? Also, is this an actual article from a newspaper?... Or is it the musings of an anonymous nobody on some blog?

[gore3000]

One thing that bothers me about this case is that SCO is threatening people BEFORE THE ISSUE HAS EVEN GONE TO COURT. Now, that seems putting the cart before the horse. It also tells me that SCO does not believe very much in its case and is really playing front man for Microsoft. Linux has gotten too good and is becoming a threat.

[Nick Danger]

little issue known as damages. Since your Linux vendor gave you

Yeah, this indemnity thing sure is a problem. Or at least, so say the Microsoft wives. You and your snake buddy can't talk enough about the scary liabilities that might be ours if we use linux.

Hello? There was a major software snafu this week that has caused several hundred millions of dollars in damage.

I notice that you and your snake haven't mentioned that, nor has the ubiquitous Ms. Didio, who never tires of telling us how awful it is that IBM won't indemnify its linux customers.

So, tell us, who will the first to collect on this magnificent indemnification program offered by Microsoft? Hundreds of companies lost days of productivity, all because Microsoft still hasn't figured out how to keep the damned worms from taking over the machines.

Don't tell us this was a surprise. These things happen every few months now. Thousands of people were idled by this one. Is Microsoft going to step up and pay for this, or what? If not, when are they going to start?

To hear all the noises from the Microoft wives, only linux customers have to worry about damages from software because the other guys all indemnify their customers.

Yeah, sure they do. As usual, it's just another way for Muchkins to spew FUD, throw mud, and repeat the same talking point over and over again. When the trouble actually comes, and IT managers are forced to spend hundreds of support hours to bail their companies out of the mess that's been created, the Great Indemnifier is nowhere to be found. It was all talk, and no dollars. Instead he's standing there pointing at linux. "Booga booga! Watch out for that linux! Something bad might happen if you touch that!"

As Charles Cooper put it on ZDNet,

To its credit, Microsoft did issue a patch for this latest worm after it was uncovered by a group of Polish hackers and independent security consultants a couple of weeks ago. However, I'd do a hard stop right there.

If this were the exception rather than the rule, I would agree that the customer should be held responsible for making sure the latest fixes were downloaded onto a company's computers. But after two decades' worth of Swiss cheese software security, the world's biggest supplier of operating system software has run out of excuses. It took scientists less time to map the human genome.

Businesses, which rely on the assumption that Microsoft operating systems will stand up to attacks, might have assumed the statute of limitations on making lousy software ran out with the last of the Internet sock puppets. Users should be so lucky.

Be sure to tell us once again about the damages that linux might cause. Everybody needs to be warned about those linux damages. There's just no telling how much damage one might suffer from running linux. Meanwhile, out the real world, there is real damage, and real closed offices and real cellphone networks knocked out by yet another chunk of sloppy code from those Other Guys. And if anybody brings up all this "indemnity" talk they've been spouting, they are just gonna laugh. It'll be just like one of those El Cheapo homeowner's policies where as soon as something actually happens, you find out that down in the fine print it says you're not covered.

[Golden Eagle]

There was a major software snafu this week..

Yes, there was, and I fully support you seeking out the hackers for the full damages. "Chinese X Factor" was the original unit that posted the flaw, I believe.

So, tell us, who will the first to collect on this magnificent indemnification program offered by Microsoft?

Microsoft has long refunded one's money if necessary, there are scams posted on the internet about how to do it even if you're not deserving. Concerning "protection from liability", I never had to pay for Stacker, for Netscape, etc. Microsoft was found guilty by a court, but I was indemnified from any personal liability. But if 'Linux' loses in court, you have no one protecting you from damages if your user base is using Unix code illegally. The concept is simple, actually - you want protection, you gotta pay, which 99% of Linux users never have, not a dime, to anyone. No protection then, simple. Don't like it? Quit paying your taxes to the government too then.

[Nick Danger]

he concept is simple, actually - you want protection, you gotta pay,

OK, so what is Microsoft's program for paying for all these damages caused by its negligence? Can companies whose computers were knocked out by this thing send the repair bills to Microsoft, or are you just trying to ram home a talking point about 'linux' and 'damages' while waving off the very real damages that happened to thousands of companies this week?

I know what I'm going to get back from the Microsoft wives... "it's the hackers, it's the criminals, it's the Chinese. You shoulda downloaded and installed the patch on your 20,000 seats." It's all arm-waving hoo-hah about how Microsoft is not responsible... and the customers are going to eat their own damages. But everybody needs to watch out for that linux because Red Hat is not protecting its customers from damages.

Everybody got a real good lesson this week in what all the "indemnity" talk from µsoft and its talking bugles is actually worth. Zero.

[Golden Eagle]

OK, so what is Microsoft's program for paying for all these damages caused by its negligence?

I really don't see "negligence" as a fault of Microsoft in this case. The flaw took advantage of something that has existed since Windows NT, so it has been fine for what, six or seven years before these hackers were able to crack it? Then very soon after Chinese X-Factor posted it to the internet, Microsoft provided a patch, WEEKS before the actual worm hit.

Hardly qualifies as "negligent". You want riteous justice? Go after Chinese X-Factor, and whoever else helped them create the worm. I really don't understand why you keep protecting them instead.

[Dominic Harr]

"We're fighting for the right in the industry to be able to make a living selling software".

Yeah, and I got a friend convinced the Cowboys are going to win the Super Bowl this year.

Of course, to most observers, you're both one bucket shy of a full well.

This game will be played on the field of the Court Room. You have made some amazing predictions that you can tell no one believes. You've managed to garner even *less* support than Pat Buchannan, which is hard to do indeed. You back apparent shysters in the name of 'Americanism', aiding and abetting what seems to be fraudulent conduct while wrapping yourself in the flag -- one of the most pathetic behaviors I've ever heard of.

You turn a blind eye, won't even acknowledge the massive evidence of fraud and stock pumping you're enabling and supporting.

That alone marks you and your purpose. And explains the lack of support for your position.

[jammer]

Nick, the REAL FUD is in the peoples' brains at Microsoft. I say that as one who not only doesn't [yet] use Linux, but who uses MS exclusively. The more the Microsofties talk, the more I am convinced of two things: (1) MS is powering the suit, along with the P.R., and (2) MS is scared s***less by Linux.

These folks give John the Baptist a run for his money in being ardent proponents. Except in this case, the motivation is pure fear.

[Nick Danger]

But if 'Linux' loses in court, you have no one protecting you from damages

That's "what if," which means it's FUD. We don't need to speculate about the Great Indemnifier's potential to cause damage. We all saw it last week. Hundreds of millions of dollars' worth of actual damage caused by Microsoft's continuing negligence. No "what if's" about it.

Microsoft has long refunded one's money if necessary

Oh do tell us again how linux needs to be indemnified. Is that your final answer? Hundreds of million of dollars in actual, not potential damages, and sit you sit there with a straight face and tell us that Microsoft will "refund our money" but that linux is a big problem? How do you sleep at night after peddling such bald-faced crap in public?

People spend a lot of money on Microsoft products. When exactly is all this indemnification we keep hearing about supposed to take place? It's all hot air, isn't it? You posit hypothetical court losses for linux and tell us people should be scared. But given actual it-just-happened damage from Microsoft products, you tell us that the indemnity story is that they'll give us our money back. Go peddle your FUD somewhere else.

[Nick Danger]

Go after Chinese X-Factor, and whoever else helped them create the worm. I really don't understand why you keep protecting them instead.

Because I am hanging you from your own hook. You're the guy who tells us that an actual weasel who sneaks purloined code into linux is irrelevant — we have to worry about Linus Torvalds and the whole system of open source development and hold Red Hat and everyone else accountable.

The minute something untoward happens to a Microsoft product, it's time to play, "Blame the individual weasel."

How do you sleep at night after trying to sell such bald-faced crap in public?