In a ruling that should surprise no one, California Ninth Circuit Court Judge Jeremy Fogel has dismissed a lawsuit filed by ZL Technologies that accused Gartner of committing a host of illegalities simply through its placement of ZL's e-mail archiving software in the "niche" box of Gartner's famously controversial Magic Quadrant.
In essence, this case boiled down to a question of whether the Magic Quadrant is an objective presentation of quantifiable facts, or -- as Gartner argued and should be obvious to all -- simply Gartner's opinion based on its research.
Whatever one may think of Gartner or its fabled Magic Quadrant, this lawsuit -- more accurately described as a legal fit of pique -- was as frivolous as they come. Here's my post from last month that includes all of the necessary links should anyone be inclined to read the back-and-forth filing that preceded the judge's tidy dismissal.
From the judge's ruling filed yesterday:
The Court agrees with Gartner that the general tenor of the MQ Report negates the impression that Gartner is asserting an objective fact by assigning ZL a "Niche" status. The cover page of the email archiving review states specifically that, "The opinions expressed herein are subject to change without notice."
... Finally, ZL argues that Gartner's representation that it provides "highly discerning research that is objective, defensible, and credible to help [customers] do their job better" implies that its Reports contain objective assertions of fact. Gartner notes that this language appears not in the MQ Report but on its website and that the language describes Gartner's research services generally rather than the MQ Report in particular.
More to the point, the terms "objective, defensible, and credible" do not imply the assertion of factual information. Gartner argues convincingly that even if its self-description did refer to the statements within the MQ Report, its "sophisticated readers" - corporate and government executives and professionals - would not infer that Gartner's rankings were anything other than opinion. Gartner contends that its use of the word "objective," reasonably represents that its rankings are arrived at through "independent and unprejudiced" methods. Gartner also argues persuasively that the word "defensible" simply means "capable of being defended." While its use of the word "credible" reflects Gartner's belief that its ratings are trustworthy, such use cannot reasonably be understood as a statement of fact.
While dismissing each and every one of ZL's five allegations -- "defamation, trade libel, false advertising, unfair competition, and negligent interference with prospective economic advantage" -- the judge did reluctantly allow ZL another bite at the apple by giving the company 30 days to come up with something more credible. And, unfortunately, it appears as though ZL is committed to trying.
Here's part of statement e-mailed to me by ZL's public relations firm:
While we are disappointed that the court has dismissed our lawsuit as filed, we are pleased that it has given us leave to amend our complaint, over Gartner opposition. We believe the market should take note that the defense on which Gartner prevailed was its argument that its reports contain "pure opinions," namely, opinions which are not based on objective facts. In ZL's view, that is directly contrary to the statements Gartner makes to its customers when selling its allegedly sound research. ZL intends to amend its complaint and refile within 30 days."
And hopefully Judge Fogel will send them a bill for wasting the court's time.
(Update: Gartner's ombudsman reacts to the decision here.)
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Gartner
What would help all concerned here, is if Gartner would simply present the scoring sheet to everyone once an MQ is completed and released, similar to what Forrester does when it releases a Wave. Transparency is the key issue here, as well as reference checking governance (however that's a whole other story for another day). The Gartner Ombudsman has heard the issue of scoring transparency repeatedely however for whatever reason chooses to ignore it. Oh well, hopefully this little scare might shake things up a bit.
Forrester, on the otherhand, provides complete visibility and a line item view of how they score each product in the running.
Research in general
Sure it should be obvious that it is opnion based on research.
"In essence, this case boiled down to a question of whether the Magic Quadrant is an objective presentation of quantifiable facts, or -- as Gartner argued and should be obvious to all -- simply Gartner's opinion based on its research."
However it should also be clear that the research methods are part of the mystique of a company. Sometimes and I do not suggest that Gartner does this, one could imagine that personal bias can creep in.
What we do need to have (and no I am not prepared to do it!) is some kind of rating agency that looks at the research published by the research companies - all of them and not just Gartner and produce an objective score of the accuracy of predictions. Just like we do with stock analysis.
I think we might be quite suprirsed by the results of such analysis.
the other aspect
is that, you know,'niche' isn't saying it's bad. Just like not every movie is a blockbuster, but some do very well aimed at a particular audience.
Transparency not necessary?
It's obvious that the major thing that moves you "up and to the right" in the MQ is "revenue to Gartner." VC Bill Burnham said as much over four years ago: http://billburnham.blogs.com/burnhamsbeat/2005/06/conflicts_and_c.html
Twisted reality
The statement by ZL, "...Gartner prevailed was its argument that its reports contain "pure opinions," namely, opinions which are not based on objective facts." is twisting reality. Opinions, pure or impure, are often based on objective & other types of facts, plus gut feelings, prejudices & experience.
I wonder if ZL isn't trying to promote their product through 'any means' like so many others have done.
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