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Linux Users May Be Breaking U.S. Securities Laws According to Attorneys

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Many companies using Linux for embedded applications may be unwittingly violating the Linux license and even breaking federal securities laws, according to a white paper released today by Wasabi Systems, a leading embedded operating systems provider. The white paper, When GPL Violations are Sarbanes-Oxley Violations, is the first in a series of legal studies analyzing the common misperceptions and risks associated with Linux and its license, the GNU General Public License (GPL). Future white papers will look at the GPL implications of Loadable Kernel Modules (LKM) and how upstream GPL violations impact VARs and end users.

According to Michaelson, the problem lies with the requirement of the Sarbanes-Oxley Act, passed in 2002, that companies disclose ownership of intellectual property to their shareholders. Michaelson says that dozens of companies are discovered each year to have violated the terms of the GPL, and if they are public companies, they are violating Sarbanes-Oxley. "If companies are violating the GPL, they don't have the right to use that software," asserts Michaelson. "And if they don't have the right to use the software, they're violating federal law if they claim that they do."

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