The "once a derivative, always a derivative" does not quite hold true. You can look for example, at the recent SCO versus the-rest-of-the-world litigation and the discussion that followed. As SCO claimed that the Linux sourcecode contained copyrighted works of SCO, both IBM and Opensource (and Linus Torvalds) requested SCO to identify the infringing pieces of code so that those could be rewritten.
Now, according to the "once a derivative, always a derivative" rule, obviously no such rewriting could occur, especially since the parts SCO claims they own the copyrights to, have been released in source format. Hence, if the "once a derivative, always a derivative" rule actually would hold up in source code development, a single code contribution could pollute the development of large projects (indefinetly, since those code contributions could not be replaced by non-infringing pieces of code), thus making the whole open source development model unviable.
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