As I understand it, RISC OS Ltd only own what they have produced (and even then they are contractually bound to show the source to the IPR holders of RISC OS). All they had was a licence to sell RISC OS 4 exclusively to ARM based ie ARM7500 and StrongARM based desktop computers. IN other words, they could only sell a 26bit version of the OS to run on obsolete equipment. PACE, the IPR holders are then approached by Castle, who say they want to sell a desktop machine that runs on the new XScale processors in 32bit mode. So PACE sell them a licence to run their IP on a completely different set of machines. This version of the OS is called RISC OS 5 to distinguish it from the product that ROL is selling, it is a seperate and completely independent product, sold under a different licence. RISC OS Ltd can cry foul as much as they like, their licencing agreement with PACE was not affected by RISC OS 5 because it is a completely different product.
Now, in the mean time, ROL have started selling a version of RISC OS 4 that runs on Intel Pentium processors under the Virtual Acorn emulation software. This is a flagrant breach of their original licence with PACE, but PACE were not to bothered, as RISC OS was a small part of their bussiness. However, when PACE sold the IPR that is RISC OS to Castle, a small company that is 100% dependent on their newly acquired IPR, and cannot afford to allow RISC OS Ltd to continue breaching the conditions of their licence.