Short bio: Computer Scientist, FOSS supporter (read more)
Tux Machines (TM)-specific
The question of whether proprietary closed source code is present inside open source code is a huge issue. It sits at the crux of the SCO battle against Linux and it is also at the center of another controversy surrounding an open source effort to create a free clone of Microsoft's Windows operating system.
ReactOS is part of a decade old effort to replicate a Windows operating system as an open source or free software based system. It's not the only effort trying to duplicate Windows type functionality on an open source system. The Wine project which began in 1993 is a similar effort but unlike ReactOS its goal is not to produce an entire operating system, but rather just allow Windows applications to run on Linux. Certain elements of Wine are also part of ReactOS.
In January of this year, allegations were levied against ReactOS that some code may well have been inappropriately taken from Windows NT and found its way into the open source clone. In response the ReactOS development team stopped development and downloads and began a detailed audit of their code base.