SCO claims that Linux contains code from the Unix OS, to which SCO owns the copyright. This claim is at the center of SCO's US$3 billion lawsuit against IBM, which alleges that Big Blue misappropriated SCO's Unix source code and incorporated it into Linux.

IBM has denied that charge and has filed a countersuit against SCO.

Because SCO's Linux invoices will be based on a disputed claim, analysts question the technique's effectiveness. The invoices "are an interesting gambit," Yankee analyst Laura DiDio told NewsFactor. Yet the company "cannot enforce" its payment demand, because its legal claim is still pending, she noted.

Licensing Linux

In July, SCO announced that it expected enterprise Linux users to buy a Unix operating license. The license's proposed price was $699 for a single-processor server. The company threatened legal action against Linux users who did not comply with its licensing demands.

In an effort to collect the licensing fees, SCO will invoice "known companies that are using Linux and who have been very public about their use of Linux," Stowell said.

The amount of the invoice "depends on the server installation" a given company has, he said, adding that the invoice amount will be based on the $699 per processor figure. Larger users will get a slight discount, he explained.

SCO's invoicing strategy "could backfire," DiDio said. "The danger for SCO is that they alienate those companies who might have been considering paying a licensing fee. This might be too pushy."

Dell: No Protection For Linux Clients

In a related development, computer-maker Dell -- a major proponent of Linux and, therefore, a likely recipient of a SCO invoice -- has announced it will not indemnify its customers from possible legal ramifications arising from Linux use.

Some of Dell's larger Linux customer reportedly had asked the computer maker for legal protection.

But leading Linux vendor IBM has said such indemnification is not necessary. "The terms of the GPL make it clear that there are no warranties or indemnities with Linux, and our customers understand that," IBM spokesperson Trink Guarino told NewsFactor.

SCO Is Fined

SCO has been fined by a German court for failing to properly comply with a ruling that ordered the company to desist from making ownership claims of the Linux kernel in Germany.

In May, German Linux organization LinuxTag filed suit against SCO after the company sent letters to 1,500 corporations worldwide warning of potential legal problems arising from using Linux. LinuxTag obtained a restraining order that ruled SCO must retract its Linux claims or make its evidence public. In response, SCO took down its German site.

Now, LinuxTag has filed another legal complaint against SCO, claiming that SCO showed a link to the Linux letter to its business partners. The judge ruled in LinuxTag's favor, fining SCO 10,000 euros, or about $10,000 dollars. SCO is appealing the ruling.