UPDATE 2-Novell could be banned from selling Linux--group

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By Jim Finkle

BOSTON, Feb 2 (Reuters) - The Free Software Foundation is reviewing Novell Inc.'s (NOVL.O: Quote, Profile, Research, Stock Buzz) right to sell new versions of Linux operating system software after the open-source community criticized Novell for teaming up with Microsoft Corp. (MSFT.O: Quote, Profile, Research, Stock Buzz)

"The community of people wants to do anything they can to interfere with this deal and all deals like it. They have every reason to be deeply concerned that this is the beginning of a significant patent aggression by Microsoft," Eben Moglen, the Foundation's general counsel, said on Friday.

The foundation controls intellectual property rights to key parts of the open-source Linux operating system.

Novell angered members of the open-source community that develops Linux and other free software programs in November when it entered a wide-ranging business deal with Microsoft.

Critics called on the board to punish Novell by banning it from distributing new versions of Linux software, said Moglen.

Linux is the most popular variant of open-source software. Unlike proprietary software such as Microsoft Windows, open-source software lets developers share code and add functions and is generally available at no cost.

Moglen said the board has not made a decision on the matter but that he expects it to announce a ruling within two weeks.