Online CRM rental firms may be smaller in size than the likes of Siebel and SAP, but they are demonstrating the litigious tendencies of their more mature counterparts.
Just as advertising wars have characterised feuds between SAP and Siebel, so now Salesforce.com is suing rival UpShot over claims that UpShot ads constitute "false advertising, unfair competition and unfair business practices'.
The company had previously complained via the Better Business Bureau's National Advertising Division. According to Salesforce.com, that group had concluded that UpShot's ad headline, "The Better CRM Online Solution," and its claim to be the "leading Web-based sales-focused CRM solution" were not supported and should be changed.
But the NAD sided with UpShot on a number of more specific claims, such as its contention that medium and large businesses make up a larger percentage of its customer base than Salesforce.com's.
"We believe in competing fairly in the marketplace, not in deceiving prospects through false and misleading advertising," said Marc Benioff, CEO of Salesforce.com.
UpShot Chairman Keith Raffel said the lawsuit is baseless. "I think what this comes down to is, Salesforce.com can't beat us in the market -- we haven't lost a 50-plus-seats deal to them since January -- so they're turning to the courts with bully-boy tactics," Raffel said.
Last month Salesforce.com claimed to be the first ?software-as-services" company, to post a profit. For its quarter ended April 30, 2003, the privately held company said it notched up a profit of $188,000 on $19.1 million in revenue, nearly twice the year-ago figure of $9.6 million.