OK, I haven’t written much on the SCO vs. Linux debacle in a while, mainly because others have done so much better and in much more detail than I possibly could, so here’s a summary of the situation as I see it.

SCO: Linux stole from us!
Linux: Uh, no. What did we steal?
SCO: Linux stole from us!
Linux: No, we didn’t. What are we supposed to have stolen!
SCO: Linux stole from us! They’re un-American commie terrorists!
Linux: Dude, what the heck? Tell us what we stole or stop accusing us!
SCO: Linux stole XYZ from us.
Linux: No, we got that legally from so-and-so.
SCO: Uh, never mind. We meant to say Linux stole ABC.
Linux: No, we got that legally from such-and-such.
SCO: No, we mean JFS and NUMA!
IBM: Hey, we invented those ourselves.
SCO: We have proof! We have millions of lines that Linux stole!
Linux: Such as?
* crickets *
SCO: We have millions of lines! Millions of them!
Linux: Shyeah, right.
SCO: But don’t worry, for a mere $699, you can assure yourself that we won’t sue you for this chunk of Linux that we haven’t actually proved we own yet!
Linux: $699? For a small piece of something you won’t even prove you own? What’s next, charging Windows users an extra $700 for Notepad because they can write code with it? [Looks up definition of “protection racket”]
SCO: Did I mention we own BSD, MacOS, and Windows too? They’re next! (Well, except Windows, ’cause Microsoft gave us money. For something else, I mean.)
BSD: You’re kidding, right? We went through this in court a decade ago.
SCO: Wait, we never said anything about BSD.
BSD: But in this interview right here —
SCO: Linux is evil! The GPL is unconstitutional! If you let people use software for free, then the terrorists have won!
Linux: What are you people smoking?

Then there are the lawsuits:

SCO: IBM stole from us and put stuff into Linux!
IBM: Such as?
SCO: Stuff!
IBM: Details, please?
SCO: They stole ABC, DEF, and GHI!
IBM: Dude, we invented those things ourselves! What are you talking about?
SCO: Aha, but you developed those for AIX, and we own AIX!
IBM: No, you own Unix. We have a contract with you that lets us use Unix in AIX, but we own anything we wrote. Besides, half those things started out in other IBM products anyway.
SCO: Aha! You admit it!
IBM: No, we own those things, and we can do whatever we want with them.
SCO: Fools! We own all your code! If it even touches Unix, it’s ours!
IBM: And these guys call the GPL viral?
SCO: We’re revoking your license! You can no longer sell AIX!
IBM: What about this clause that says “irrevocable?”
SCO: Hey, look over there!
IBM: Where?
SCO: Oh, nothing. Now, Judge, I have proof that IBM stole from us and put stuff into Linux! Proof! Millions of lines!
IBM: Fine, prove it.
SCO: Well, we can’t actually prove it without looking at IBM’s code…
IBM: Wait, you have access to your own code, everyone has access to the code in Linux, and you need to see our code to prove that it’s infringing? I thought you said you already had proof…
* several more rounds of this go on *

Meanwhile:

RedHat: SCO, I want a declaration that we don’t infringe on your copyrights.
SCO: Oh, don’t worry, we’re not going to sue anyone but IBM.
RedHat: I’ll believe that when I don’t see it.
SCO: Red Hat and SuSE will get theirs, don’t you worry. BTW we’re going to start suing Linux users any day now.
Linux: (Didn’t they just say…)
RedHat: (Yeah, they did.)
* a few months later *
Linux: I thought they were going to start suing Linux users.
SCO: Wait for it…
* crickets *
SCO: We’re suing AutoZone and Daimler Chrysler! They use Linux!
AZ&DC: Yeah, but you didn’t sue us for using Linux. You sued us because we stopped using your products.
SCO: Pay no attention! They’re thieves! They’re filthy little thieves!
AZ&DC: Riiiight….

Further Reading:
GrokLaw (an excellent resource!)
TWikiWeThey: SCO vs. IBM [archive.org]
OSI Position Paper on the SCO-vs.-IBM Complaint
FAQ: SCO and Linux