Cisco Distributor Agreement

A judge`s ruling on Cisco`s reseller deal could trigger a flood of complaints from partners who believe their businesses have been harmed by the network giant`s Indirect Channel Partner Agreement (ICPA). Judge Gregory H. Lewis at the California Superior Court in Santa Ana, California, who led a lawsuit between former reseller Infra-Comm and Cisco, ruled that parts of Cisco`s ICPA were “ruthless,” ChannelWeb reports. “Unscrupulous” means a contract or part of a contract that is unilateral in favour of the person who has superior bargaining power. This week, the judge ruled ruthless three provisions in Cisco`s ICPA: that the partner does not have the ability to negotiate the terms of the contract if it uses the Cisco site to renew contracts; that Cisco may terminate a reseller agreement with only one month or without notice at the beginning of each year; and that ICPA limits the damage to what a Cisco reseller pays in three months for services and products, which could be unfair to long-standing resellers. Judge Gregory H. Lewis, who presided over the trial in California Superior Court in Santa Ana, California, ruled Tuesday that several parts of Cisco`s ICPA were sometimes unscrupulous because Infra-Comm was unable to negotiate the terms of the agreement during the renewal process. Judge Lewis, however, said Cisco required resellers to enter into a contract for only one year, with Cisco having “an absolute right to the substance and with a single one-month period and which it can terminate without notice at the beginning of each year.” Cisco also said damages should be limited to an amount commensurate with the volume of business with a particular reseller, but Judge Lewis said the court could not rewrite the contract between the two. While the jury will consider the verdict during its deliberation, Cisco may ultimately appeal the verdict, Daucher said. “But it`s the discretion of a judge,” he said. “She has the right to have respect in the appeal. I don`t think Cisco will be able to attack the results of scruples in vocation. .

Cisco will likely have to rewrite its contract. “The crux of this question is whether the plaintiff had the ability to negotiate,” Judge Lewis said. “Given the `click to accept` nature of the treaty, the Tribunal finds that the complainant has fulfilled his burden, his initial burden, that he has not been able to negotiate the conditions.” Judge Lewis stated that Cisco`s ICPA provision, which limits damages to what a Cisco reseller pays for services and products for three months, while it may apply to a new reseller relationship, cannot be justified for a relationship that has existed since 1999. Brian Daucher, a lawyer representing Infra-Comm, told ChannelWeb that the decision on the ability to scrupulous in general is an asset for solution providers. The third provision, considered ruthless, is the limitation of damage. . . .