Nasdaq Kicks SCO Out, Gupta Leaves the Company

Published: January 10, 2008

by Timothy Prickett Morgan

The situation just keeps getting more ominous for commercial Unix distributor The SCO Group. After filing for bankruptcy and trying to sell off its Unix business in the middle of a bunch of epic lawsuits with IBM and Novell, some more bad news has come out of the company. On December 18, after IT Jungle went on holiday, SCO said that its key Unix executive, Sandy Gupta, had left the company. A week later, the Nasdaq market on which SCO's stock is traded said it would suspend trading in SCO's stock on December 27.

The delisting by Nasdaq is related to the bankruptcy filing that SCO did in September 2007. The company's shares are still listed on the Over the Counter market under the stock symbol SCOXQ.PK, and as we go to press, the company has a $1.83 million market capitalization now that its shares are trading for 8.5 cents a piece. This is a far cry from the $20 range the company's shares were trading at back in 2003, when the IBM and Novell lawsuits had not yet drained SCO of money and the case SCO was making against these two companies seemed broader and more plausible than it does today. (Ultimately, it will be for a judge and jury to decide what actually did transpire between these companies.) Even if SCO was not delisted for being under bankruptcy protection, its shares fail to meet the $1 minimum trade value that the Nasdaq requires.

The fact that Gupta has left SCO is probably worse news for the company than the delisting, and perhaps a lot more unexpected. While SCO did not say this at the time, the creation of its SCO Operations and the Unix software development and sales business it embodied was quite possibly not only a means for SCO to raise some capital for it to continue its legal battles over Unix intellectual property and other issues with IBM, Novell, and Red Hat, but it could also have been a way for Gupta and his team of Unix people to continue doing the kind of development work they joined SCO to do.

Gupta has been at SCO and its predecessors since 1996, when he joined the software engineering team that supported independent software vendors creating ports for SCO Unix. Prior to this, Gupta worked at Fujitsu's ICL British unit, helping to port AT&T's Unix System V to the Sparc architecture. In September 2006, he took over some marketing responsibilities after Tim Negris, a then-recent hire with software marketing stints at IBM and Oracle, stopped doing that job for reasons that were never really explained. In October 2007, Gupta was promoted to president of SCO Operations, the arm of the company that creates and controls its Unix and mobile software; Gupta still reported to Darl McBride, who is president and chief executive officer of SCO Group, the parent holding company. A month later, SCO was talking about trying to sell off SCO Operations, and then a few weeks later it rescinded that idea. A month after that, Gupta left.

In the meantime, SCO has appointed Jeff Hunsaker, an executive who worked at Wordperfect, Corel, Novell, and Baan and who joined the earlier incarnation of SCO in 2000, as president and chief operating officer of the still existing SCO Operations unit of SCO Group. Hunsaker was general manager of SCO's Me Inc mobile software business unit and has held various sales and marketing jobs in the Unix business for the past seven years.

"We are at a crossroads for the company and I am pleased to work with Darl and the management team to drive our Unix and mobile businesses forward," Hunsaker said in a statement announcing his appointment. "SCO has a strong history of providing unparalleled stability and reliability with its Unix platform of products. We will continue to provide Unix upgrades to the market by listening to the needs and requirements of our customers; we will also continue to develop innovative mobile applications for consumers and business professionals alike."

SCO did not say why Gupta left or where he went, aside from the traditional line about pursuing other opportunities and thanking him for his many contributions and years of service.

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