The SCO Group (Caldera) is claiming that IBM's contributions to the Linux code base include proprietary AIX source code. SCO is suing for $1 billion.
eWeek's coverage is here.
The suit has implications for Linux users and for the open source movement. If SCO's claim is valid, then portions of Linux code are proprietary, and should not be in the public domain. Versions of Linux that already contain the code may effectively become illegal and have to be removed from the market (i.e., replaced by non-infringing versions). Such a ruling would impose a tremendous collective cost on Linux users, who would be forced to reinstall their operating systems. And SCO may be able to stop future releases of Linux until the contested code is, in fact, replaced -- a move which would, in the very least, suspend development, and, more generally, grant SCO a degree of control over Linux that is entirely antithetical and harmful to the platform's decentralized development model.