UNIX System Laboratories, Inc. v. Berkeley Software Design, Inc.
| Company type | Subsidiary |
|---|---|
| Industry | Software |
| Founded | 1989 |
| Founder | AT&T |
| Fate | Acquired by Novell in 1993 |
| Parent | AT&T (until 1993), Novell (from 1993) |
USL v. BSDi was a lawsuit initiated in 1992 in the United States District Court for the District of New Jersey by Unix System Laboratories against Berkeley Software Design, Inc. and the Regents of the University of California. The case concerned intellectual property disputes related to the Unix operating system and played a significant role in the Unix wars. The matter was resolved through an out-of-court settlement in 1994 after the presiding judge questioned USL's claims over intellectual property. Following this, Novell, which had acquired USL, and the University agreed to end their legal conflict regarding the Berkeley Software Distribution (BSD).
Background
The conflict began at the Computer Systems Research Group (CSRG) at the University of California, Berkeley, which possessed a license from AT&T's Bell Labs to use UNIX source code. With AT&T’s consent, CSRG modified UNIX and released multiple versions starting in 1978. Since BSD incorporated AT&T’s copyrighted UNIX code, distribution was limited to entities licensed by AT&T.
In 1988, CSRG removed all AT&T-owned intellectual property from its TCP/IP implementation and issued it publicly as "Net/1" under the permissive BSD license. As CSRG anticipated its closure, faculty and students endeavored to eliminate remaining AT&T code, leading to the public release of Net/2 in 1991—a nearly complete UNIX-like system believed free of AT&T intellectual property.
Berkeley Software Design (BSDi) obtained the Net/2 source code, completed missing portions, and adapted it to Intel’s i386 platform. BSDi then marketed this product as the BSD/386 operating system, which was sold directly to customers. This action prompted Unix System Laboratories, an AT&T subsidiary, to file suit against BSDi in April 1992 and subsequently added The Regents of the University of California as defendants.
USL's complaint
USL claimed that The Regents had:
- Distributed Net/2 "based upon, substantially copied from, or derived from proprietary UNIX," resulting in
- Violation of USL’s software licensing agreement;
- Infringement of USL’s UNIX copyrights;
- Tarnishment of USL’s UNIX trademark;
- Misappropriation of USL’s trade secrets.
USL requested a preliminary injunction to stop BSDi from distributing Net/2 while the case was pending.
Pretrial
During a hearing, BSDi contended that they relied on materials freely provided by the University of California along with six additional files. BSDi admitted liability concerning those six files but denied responsibility for the University-supplied files. The judge ruled in favor of BSDi and directed USL to limit its complaint solely to those six files or risk dismissal. Rather than narrowing their claim, USL sued both BSDi and the University and sought a preliminary injunction to prohibit distribution of Net/2 by either party.
In 1993, Judge Dickinson R. Debevoise rejected the injunction request, determining that USL did not hold valid copyright over UNIX/32V and failed to substantiate trade secret allegations. Because AT&T did not place proper copyright notices on copies of 32V distributed in 1978 and only registered copyright in 1992, USL’s claim was invalid under 17 U.S.C. § 405(a).
University's countersuit
Soon after the injunction was denied, the University initiated a countersuit against USL in California, accusing them of not properly attributing BSD code incorporated in System V as required by their licensing terms. The University sought remedies including USL issuing corrected documentation with accurate credits, informing license holders about the attribution lapse, and placing full-page advertisements in prominent publications such as The Wall Street Journal and Fortune Magazine to acknowledge the error.
Settlement
In July 1993, Novell completed its acquisition of USL. Novell's CEO, Ray Noorda, supported negotiations that culminated in a settlement by February 1994 with principal provisions as follows:
- Distribution of 4.4BSD-lite excluding the contested files; the University agreed to promote migration from Net/2 among its licensees.
- The University committed to halting distribution of specific files.
- USL allowed a three-month grace period for users of the disputed files.
- Selected files distributed by the University were required to bear USL copyright notices.
- Certain files distributed by USL were to include University copyright acknowledgments.
- USL consented to permit free redistribution of designated files.
- The University agreed not to support legal actions challenging USL’s intellectual property rights.
Out of approximately 18,000 files in the Berkeley distribution, only three were removed and seventy were altered to include USL copyright markings. Furthermore, the agreement prevented USL from initiating lawsuits against users or distributors of the upcoming 4.4BSD-Lite release.