On December 4, 2009, ZL Technologies filed an amended complaint against Gartner, Inc. in the United States District Court for the Northern District of California.The Court granted ZL the opportunity to clarify and augment our earlier allegations of defamation and trade libel.
In the first round of ZL's legal dispute with Gartner, Gartner argued to the Court that its rankings and other statements in the proprietary Magic Quadrant Reports are merely opinions that are not based upon fact, and that they are understood as such by the readers of those reports.
However, Gartner's past statements in marketing materials, white papers, blogs and even the Magic Quadrant Reports themselves, assert that their research and analysts' opinions are based on a body of facts compiled through what is asserted to be a rigorous process.
The amended complaint clarifies ZL's contentions about the inaccuracy of Gartner's reports, the inherent conflict of interest arising out of Gartner's voluminous business with the vendors it reviews, and its subsequent bias towards large and established vendors. The amended complaint also adds new detail about Gartner's repeated claims that its research is based on objective facts a position exactly opposite to the stance forwarded by Gartner in court.
While this case is focused on ZL's dispute with Gartner over the erroneous statements in Gartner's publications, the issues here also implicate Gartner's larger business model.
Gartner plainly admits that it attempts to leverage value from its largest clients, many of whom are also vendors covered in the company's research.
ZL's legal filings describe how that business model causes Gartner to favor those large companies at the expense of identifying the best technologies, thus misleading not just the vendors who are inaccurately reviewed by Gartner, but the consumers who base their IT purchasing decisions on Gartner's biased research.
ZL is seeking injunctive relief as well as compensatory and punitive damages from Gartner.
The amended complaint can be found here:
http://www.zlti.com/courtdocs/docs/First_Amended_Complaint.pdf
I'm glad that finally someone has publicly challenged Gartner's financially based findings. It's a very cozy business model that Gartner shares with many ostensibly "independent" consulting firms--give the powerful industry manufacturers a glowing report and reap a $500,000 windfall.
ReplyDeleteamazing. always wondered how these technology companies were able to convert to services-based companies overnight!!! sounds like the cat is finally out of the bag! hopefully Photizo doesn't end up in the same bag...
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