RESEARCH TRIANGLE PARK, N.C. – A federal court appeared to hand SCO devastating setbacks in its lawsuit against Novell over rights to UNIX. But the closely watched battle that also includes IBM and the open source/Linux communities is far from over, the software company says.

On Friday, the court ruled: “Novell is the owner of the UNIX and UnixWare Copyrights.”

For SCO, which is based in Utah, the decision meant “That’s Aaaaall, Folks!” proclaimed blogger Pamela Jones on the Groklaw blog site. (Groklaw has followed the case in minute detail – with Web hosting provided by at UNC-Chapel Hill).

“There are a couple of loose ends, but the big picture is, SCO lost. Oh, and it owes Novell a lot of money from the Microsoft and Sun licenses,” Jones wrote.

The judge also requested more information as it relates to IBM to be submitted by August 31.

However, in its first comments issued Sunday, SCO saw matters somewhat differently.

“The company is obviously disappointed with the ruling issued last Friday,” SCO said. “However, the court clearly determined that SCO owns the copyrights to the technology developed or derived by SCO after Novell transferred the assets to SCO in 1995. This includes the new development in all subsequent versions of UnixWare up through the most current release of UnixWare and substantial portions of SCO UnixWare Gemini 64. Also, SCO owns the exclusive, worldwide license to the UnixWare trademark, now owned by The Open Group. SCO’s ownership of OpenServer and its Mobile Server platforms were not challenged and remain intact. These SCO platforms continue to drive enterprises large and small and our rapidly developing mobile business is being well received in the marketplace.

“What’s more, the court did not dismiss our claims against Novell regarding the non compete provisions of the 1995 Technology License Agreement relating to Novell’s distribution of Linux to the extent implicated by the technology developed by SCO after 1995. Those issues remain to be litigated.”

The SCO lawsuit has cast a shadow over open source efforts, generating fears an SCO victory could heavily impact Linux users and companies such as Red Hat. The Linux community almost universally denies that it violates any copyright – from either Linux or Microsoft.

Paul McDougall, writing at InformationWeek, pointed out that IBM has prevailed in much of its case against SCO. But he noted that Friday’s decision didn’t close it entirely. And he said Linux users need to be cautious.

“If I’m a Linux user, do I really want SCO v. IBM to be called off without a definitive ruling on SCO’s claims?” he wrote.

“A victory by IBM could have quashed for good the notion that Linux infringes on Unix. If the case is dropped, then questions will still linger and might later be revived—by Novell or someone else.”

At Groklaw, however, Jones called the ruling a victory for the “entire” free and Open Source Software community, proclaiming:

“I’m eating chocolates!”