HP has not yet been directly involved in the $3 billion SCO-IBM Unix intellectual property lawsuit. Nor has it stuck its nose into the spin-off lawsuit that Red Hat has filed against SCO, as that company claims SCO’s claims about pilfered Unix IP inside Linux and the potential legal and financial liabilities that customers face harm the Linux business that is Red Hat’s sole bread and butter.

But, HP wants to wants to surf the upwardly flowing Linux market, which depending on the platform is growing at 30 to 40 per cent and it wants to be the dominant Linux vendor. That means sucking it up and doing what IBM Corp [IBM], Dell Inc [DELL], and Sun Microsystems Inc [SUNW] haven’t done: covered their Linux customers backs and backsides.

Martin Fink, who is vice president of Linux enterprise servers and storage, held a press conference yesterday outlining what HP is doing.

Any customer who buys a Linux license for HP iron or a machine that already has Linux bundled on it and who maintains a support contract for that Linux license is privy to the indemnification.

Customers can only run the binary code in the Linux distributions, and an addendum to the HP sales contract for the Linux machines says that if they go in and modify source code and put it on the HP machines, then the indemnification is void.

So, you can’t change one line of Linux code. This indemnification will be in effect on all HP devices sold after October 1, and any Linux licenses bought through HP for existing machines as of that time. Customers with existing HP Linux boxes can get the indemnification by working with HP to ensure that they haven’t messed with source and by signing the addendum that says they will not.

Fink says that HP has not signed any IP agreement with SCO that gives it the confidence to offer this indemnification. Rather, HP has spent months doing an assessment of the risks of offering safe harbor to Linux customers against the benefits of using fear of lawsuits and licensing fees to its competitive advantage. HP is the first IT vendor to offer indemnification, by the way, and depending on how this shakes out, it could be the only one or one of many.

Today’s announcement is about accountability and protecting the customer, said Fink, while the other vendors sit on their haunches. The future of Linux has never been brighter, and HP is giving customers the green light on their Linux deployments.

While this is true, HP would not be risking untold sums of money from potential lawsuits if it didn’t think it could make some money by turning this bad Linux situation to competitive advantage. And while Fink denied that the SCO lawsuits had dampened Linux sales, it is hard to say what Linux would be doing if these suits were not going on. For all we know, Linux growth would be accelerating even more in the past six months absent the suits.

SCO turned the HP indemnification on its ear with its own short statement, which read: HP’s actions reaffirm the fact that enterprise end users running Linux are exposed to legal risks. Rather than deny the existence of substantial structural problems with Linux as many open source leaders have done, HP is acknowledging that issues exist and is attempting to be responsive to its customers’ request for relief. HP’s actions are driving the Linux industry towards a licensing program. In other words, Linux is not free.

We are gratified that, alone among the major Linux vendors, HP has taken a strong stand to protect their customers by indemnifying them against possible legal difficulties stemming from their use of Linux. We believe that this action signals that HP recognizes their Linux users could, in fact, face litigation because of copyright violations and intellectual property problems within Linux. As a company that strongly supports its customers, HP has done something about this. Now that HP has stepped up for its customers, SCO once again encourages Red Hat, IBM and other major Linux vendors to do the same. We think their customers will demand it.

HP’s announcement – and those of Red Hat, government agencies around the world, and others – appear to flow from the belief that SCO’s claims against Linux are baseless. We agree. IBM’s position has not changed. We will fight this in court. That doesn’t sound like a promise to offer Linux and AIX customers any kind of indemnification. IBM and many others, including open source advocate Bruce Perens, think it isn’t useful. So this is not surprising.

This article was based on material originally published by ComputerWire.