NEWS22 October 2009

Gartner seeks dismissal of libel suit from email software vendor

Legal North America

US— IT analyst Gartner is to appear in court tomorrow to argue for a dismissal of a lawsuit accusing it of defamation and trade libel over its repeated description of a software supplier as a ‘niche’ vendor.

ZL Technologies says Gartner has consistently ranked it in the “lowest” quadrant of its annual Magic Quadrant report for email archiving software, which categorises software companies as either a Leader, Challenger, Visionary or Niche player.

In its complaint, ZL describes the Magic Quadrant as “a key revenue driver… which heavily influences corporate IT purchase decisions”.

ZL argues that its placement in the ‘niche’ quadrant is derogatory “because they are understood by technology purchasers as a warning, by Gartner, that ZL and the ZL products are not good choices for enterprise email archive applications”.

The company claims it has suffered damages of at least $132m “as a direct and proximate result of Gartner’s defamatory statements”.

Gartner, however, disputes that the Magic Quadrant reports cast aspersions on the quality of ZL’s offering.

“ZL does not contest Gartner’s basic assessments of ZL – that it has a good product but needs to expand its sales and marketing,” says Gartner. “The real point of contention here is not the quality of ZL’s product, but instead the subjective analytical model Gartner used to assess ZL’s market position and prospects”.

Gartner argues that such analysis constitutes “non-actionable opinion”, and as such, the complaint should be dismissed.