The Halloween X email is an email that was sent from Mike Anderer of Microsoft to Chris Sontag and Bob Bench of SCO that outlines a huge backroom deal that in short supplies SCO with all the money they need to cause all sorts of trouble for Linux.

"I realize the last negotiations are not as much fun, but Microsoft will have brough in $86 million for us including Baystar. The next deal we should be able to get from $16-20, but it will be brutial as it is for go to makerket work and some licences. I know we can do this , if everyone stays on board and still wants to do a deal. I just want to get this deal and move away from corp dev and out into the marketing and field dollars....In this market we can get $3-5 million in incremental deals and not have to go through the gauntlet which will get tougher next week with the SR VP's"
Well over at Rob Scoble's blog is an official[?] response from MS regarding the email.
"Microsoft has no direct or indirect financial relationship with BayStar" and "these allegations are not accurate" and "Microsoft has purchased a license to SCO’s intellectual property, to ensure interoperability and legal indemnification for our customers. The details of this agreement have been widely reported and this is the only financial relationship we have with SCO."
But to make matters even more odd - other than the fact that MS is using a blog for PR - is that SCO has already said that the email is real.
The SCO Group confirmed Thursday that a memo published on open-source community blogs is legitimate,
However they also said:
"It was a misunderstanding by someone from outside SCO," said Modersitzki. "Microsoft has not invested a penny into SCO."
Update: Business Week has this to say:
BusinessWeek has learned that Microsoft (MSFT ) did not put up the money, but did play matchmaker for SCO Group (SCOX ) and BayStar Capital, a San Francisco hedge fund which made a $50 million investment in SCO last October.
Public inquiry is a catch phrase amongst Canadians lately, but I think one should be held to look into this whole MS/SCO/BayStar vs Linux mess.