Escalating its US$1 billion March lawsuit against IBM Corp., The SCO Group Inc. has terminated IBM's right to distribute its AIX Unix operating system and claimed that it was now entitled to a portion of IBM's total Unix revenue.

In addition to the $1 billion in damages SCO is seeking for revenue lost to Linux, the Lindon, Utah, company is now also seeking compensation from IBM for AIX-related hardware, services and software that it ships. "Starting Friday (June) the 13th and going forward, the IBM revenue stream that ties to AIX, we're going to make a claim on that revenue stream, based on the fact that they don't have an authorized version of AIX to ship," said SCO Chief Executive Officer Darl McBride in an interview.

"We have the contract rights to terminate their use of the software in the marketplace, or their ability to distribute their software in the marketplace," said McBride.

SCO sued IBM in March of this year, charging IBM with misappropriation of trade secrets, unfair competition and other illegal actions, alleging that IBM is trying to damage Unix to benefit its Linux business. The company had given IBM 100 days to come to an agreement, an ultimatum that ended last Friday.

IBM has denied any wrongdoing in the case and, on Monday, disputed SCO's right to revoke its AIX licence. "SCO continues to make claims," said an IBM spokeswoman. "Our licence is irrevocable. It's perpetual, and it cannot be terminated," she said.

Because it has terminated the AIX contract, SCO now claims that AIX users "don't have the right to use the software, and IBM doesn't have the right to distribute or sell the software," said McBride.

Though McBride seemed to say that AIX users no longer had the right to use AIX, he stopped short of saying that they might be targets in the lawsuit. "We're not commenting on what they should do directly. We're saying that this is between us and IBM," McBride said.

The implications of these latest developments for AIX customers are not clear, according to an industry analyst. "It doesn't mean anything immediately," said Illuminata Inc. Senior Analyst Gordon Haff. "Essentially SCO has said, 'we revoke the license,' and IBM has said 'No you don't,' and things will continue on their legal way," he said.

It is unlikely that a judge would ever back up SCO's claims that AIX users no longer have the right to use IBM's version of Unix, said Haff. "It's hard to imagine, even in the worst possible scenario, that it would be enforced," he said. "You'd be telling almost every Fortune 500 company that at some level they'd have to stop running this application or that application," he added.

IBM's formidable legal muscle and deep pockets should give AIX users some measure of comfort, said Larry Rosen, a founding partner with Rosenlaw and Einschlag, a technology law firm based in Redwood City, California. "There might be some liability down the road, but my assumption is that if IBM truly did something wrong, that IBM would have a great interest in trying to protect its own customers," he said.

"If I were in a large company running AIX, I wouldn't loose any sleep tonight, and I certainly wouldn't turn off any of my applications," he added.