Changes at the Linux Mark Institute

Linux users and developers, as a whole, prefer to avoid legal and political hassles. As a result, contacts with the legal system tend to be initiated by the outside world. In the case of the Linux trademark, that contact happened in 1996, when one William Della Croce thought it would be fun to register the Linux trademark in the U.S. and start shaking down the few struggling companies which were trying to make a living in that space back then. The community reacted, lawyers were called in, and, eventually, the trademark was transferred to Linus Torvalds.

There have been occasional trademark issues since then. In 1999, a company called Channel One Gmbh made a grab for the trademark in Germany. They lost too. In early 2000, "SeriousDomains" brought about a trademark shutdown from Linus when it tried to scalp a pile of Linux-related domain names. The notion of spending big bucks for LinuxOnSteroids.com may seem amusing, but remember that things were a little different those days. Just look at the LWN Weekly Edition covering this event - the other front page story was that a company called Linuxcare thought people might want to line up and buy its stock.

Whether the domain name or the stock would be worth more now is debatable. But that event was the first episode in which the Linux trademark had been used to shut down a business in this way. In the aftermath, Linus posted an informal trademark policy to explain how he thought the mark should be used:

At that time, Linus noted that official permission to use the trademark would involve the payment of a "nominal fee," which would go to Linux International's "trademark fund."

That is where things sat for a long time. Companies using the Linux mark were expected to obtain a license for a one-time $500 fee. More recently, however, some changes have popped up which shine a light on a shift in how the trademark is being administered.

Changes at LMI

The headquarters for Linux trademark administration is, as it has been for some years, the Linux Mark Institute (LMI). It should come as no surprise that Linux International is no longer handling the trademark. What might surprise some people, however is that LMI has been reincorporated in Oregon and its web server is now hosted by OSDL. Even more surprising might be changes made to the licensing agreement for the trademark itself. None of these changes have been announced to the community.

The following table highlights a couple of key differences between the current version of the license, and the license as it appeared last October, thanks to archive.org.

October, 2004	June, 2005
LMI hereby grants to Licensee a non-exclusive sublicense to use the Linux mark and goodwill, in the form listed in the Licensee information at the end of this License form, for the purpose of marketing and distributing software that relates to the Linux operating system, whether it is an application or a version of the operating system itself.	LMI hereby grants to SUBLICENSEE, subject to the timely payment of applicable fees listed in Schedule A attached hereto and compliance with all other terms and conditions of this Agreement, a nonexclusive, non-transferable license and right to use the SUBLICENSED TRADEMARK solely (a) in the TERRITORY; (b) for the SUBLICENSEE MARKS identified on the signature page of this Agreement; and (c) on AUTHORIZED GOODS/SERVICES which are (i) produced by or for SUBLICENSEE, and (ii) distributed under SUBLICENSEE's name.
This License is perpetual so long as Licensee complies with the terms and conditions of this License...	If SUBLICENSEE is in material breach of one or more of its obligations under this Agreement, LMI may, upon its election and in addition to any other remedies that it may have, at any time terminate this Agreement and all the rights granted hereunder by not less than thirty (30) days written notice to SUBLICENSEE specifying any such breach, unless within the period of such notice all breaches specified therein shall have been remedied. By way of example but not of limitation, a material breach includes a failure to timely pay the sublicense fees set forth in Schedule A.
One Time Single Payment Royalty. This License shall become effective only upon acceptance by LMI at its official office in Monterey, California and the receipt by LMI of a one-time license fee of Five Hundred Dollars (US $500.00), which shall be non-refundable under all circumstances.	SUBLICENSEE shall pay to LMI a periodic trademark sublicense fee as specified in Schedule A appended hereto (the due date of such payment, the "Payment Due Date").

The new license has clearly gained a great many capital letters. It also has a new "schedule A" setting out what the license will cost. The figure varies depending on the amount of revenue the licensee gains from the Linux-related products; it can be anywhere from $500 to $5000. At the low end, there is a $200 rate for non-profit companies. At the high end, the $5000 applies to each product or service using the trademark. In all cases, however, the new fee is annual - it must be paid every year, or the right to use the trademark goes away.

What has also come out is that the Institute is actively contacting companies and telling them that they need a license. In this quest, it has started to upset some members of the community; in particular, Bruce Perens received a demand that the UserLinux project purchase a trademark license. Mr. Perens does not appear to be upset about trademark licensing in general, but the terms of the new agreement are not to his liking. In particular, he objects to the terms of the license grant, which reads:

How, asks Bruce, can these terms be made to work for a project like Debian, which has little control over how its distribution is distributed? Can Debian call its product "GNU/Linux" when said product can be distributed by others, using different names?

What is really going on

LWN spent some time trying to figure out what is going on at LMI; in the process, we took up quite a bit of Jon 'maddog' Hall's and Eric Boustani's time. Eric, a member of the LMI board, has been involved with the Linux trademark since the beginning, when he helped to set up the initial licensing scheme. What Eric tells us is that, over the last year, there has been a constant effort to solidify and improve the management of the Linux trademark, with the community's interests kept firmly in mind. While the work has been ongoing, only now are the results beginning to be visible.

There were a number of problems with the previous management scheme which needed to be addressed. The number of trademark licenses issued was too small - companies simply were not buying them. The protection of the Linux trademark was spotty - it is not possible to simply create a worldwide trademark license, and the mark had not been registered in many countries. There have been abuses of the trademark (Linux-related domain names pointing to porn sites, for example) which needed to be shut down. Solidifying the Linux trademark requires bringing more resources to bear, which is being done in a couple of ways. One is the increase in licensing fees, especially for the larger companies which are making money from Linux. The other was to bring in some outside support, which has come from OSDL. So OSDL is providing hosting and some staff time to assist LMI. Eric insisted, however, that OSDL has not taken over the management of the Linux trademark, and that it has no special rights with regard to that mark.

The licensing changes are aimed at improving the situation. The old licensing fee was simply not enough to fund LMI at the level it needed to properly manage the trademark. The change in the license term is meant to address a different problem: the perpetual term of the old license gave LMI no way to terminate a license. Termination in this case is not a punitive or enforcement measure; the real problem is simply companies which go out of business or stop using a Linux-related trademark for some other reason. A renewable license allows parts of the name space to be reclaimed when they fall out of use. The one-year term also allows the license to be regularly reviewed and updated; things change quickly in the Linux community, and the legal structures need to be able to change too.

LMI was not able to talk much about the specific complaints raised by Bruce Perens. Mr. Hall has described them as "non-issues," however. He and Mr. Boustani have both said that the last thing LMI wants to do is to create difficulties for community projects. If some aspect of the licensing language does turn out to be a problem, they will find a way to change it if they can.

One thing that is worth noting is that the process by which LMI makes its decisions is opaque to the community, at best. Mr. Bourstani tells us that LMI understands this, and plans to change things. So we should see initiatives from LMI to "open things up" and give the community a larger say in how the trademark is administered. Much of the work which has happened so far has been the laying of the foundations that needed to happen first.

For the curious: the current LMI board members are: Larry Augustin, Eric Bourstani, Jon 'maddog' Hall, Linus Torvalds, and Stuart Cohen. Mr. Cohen is the CEO of OSDL; he has held a board position for a relatively short period of time.

In conclusion...

One might wonder why all of this matters. The fact is that the care of the Linux trademark is an important issue. The trademark must be held by somebody, or we run the risk of more Della Croce-style shakedown attempts. If no effort is made to protect the trademark, it may degrade into a generic term which anybody can use. This may seem like the best outcome to some, but who can doubt that it would lead to some sleazy operators distributing products called "Linux" which none of us would recognize as such?

It is to our benefit that the term "Linux" actually means something. If we want that situation to continue, then somebody must defend the trademark. So a group like the Linux Mark Institute seems like a necessary evil. LMI has not conducted itself in a manner contrary to the community's interests in the past, and it does not appear that the recent changes at LMI will be anything but good for the community. If the community is to believe that over the long term, though, LMI will have to follow through with its plans for greater openness. An organization which is truly operating in the community's interest has no reason to fear the community's participation.

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