Is Cisco cheating a reseller?

A California reseller will get its day in court to state its case against Cisco, which is alleged to have snatched a $5 million opportunity away from the reseller and turning it over to AT&T. According to the reseller, Infra-Comm of San Juan Capistrano, an Orange County judge has denied Cisco's motion for summary judgment on a lawsuit filed against it by Infra-Comm. The lawsuit charges Cisco with breach of an exclusivity promise and improperly taking an IP telephony deal from Infra-Comm to reseller AT&T.

The lawsuit was filed January 2007. In it, Infra-Comm said that Cisco breached contracts related to Cisco's Opportunity Incentive Program deal registration, including its Indirect Channel Partner Agreement.

Infra-Comm alleges that in January 2006, after working for years with the reseller to develop a large IP telephony sale, Cisco invited AT&T to take Infra-Comm's place as reseller on the opportunity, including disclosing the reseller's work and extending the same pricing to AT&T. The lawsuit says that Cisco authorized AT&T's alternative sale to the customer during the period that Infra-Comm held a valid deal registration. It further alleges that Cisco then ignored its own promise to renew Infra-Comm's registration and now sells virtually all Cisco products and services to the same customer through AT&T.

After filing the lawsuit, Infra-Comm says Cisco terminated the company's status as an authorized reseller and Silver Partner and with it, Infra-Comm's ability to resell Cisco products and related services to 40 active clients. As a result, Infra-Comm lost 90% of its revenue, closed its two offices, and had to lay off most of its employees, according to the reseller.

Cisco says it is company policy not to comment on pending court cases. Nontheless, the compnay says it is "defending the allegations in Infra-Comm's complaint vigorously.

"With more than 80% of our annual product and services revenue being sold by our channel partners, we are committed to their success and are proud of our award-winning channel programs," a company spokesman replied in an e-mail.

Infra-Comm had been a Cisco indirect channel partner since 2000.

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• Cisco
• LANs / WANs
• VoIP / Convergence
• AT&T
• lawsuit
• reseller