NetSuite also claims that in 2008, Skyytek "made disparaging remarks about NetSuite to an unnamed industry financial analyst, who, as a result thereof, downgraded NetSuite's stock." As a result, NetSuite's stock price fell, according to the filing.
NetSuite moved to terminate its agreement with Skyytek in August 2008. Under their contract, NetSuite was no longer required to pay Skyytek if the deal was ended "for cause," but NetSuite offered to terminate it "for convenience," giving the reseller a stream of shared revenue for three more years, according to the filing.
So far, NetSuite has given Skyytek at least $151,178.37, the filing states. The company is seeking damages in that amount, as well as various other sanctions against Skyytek.
It's not often that contract disputes between vendors and resellers end up in public view, since many are settled out of court.
But the channel will always be part of the SaaS landscape, particularly applications aimed at SMBs, since vendors "need a local face" and can't build a sales infrastructure from scratch, said Forrester Research analyst Ray Wang in an interview.
Therefore, it's important for customers to determine the strength of their reseller's relationship with a vendor, according to Wang. "If you've invested a lot in a partner, and the vendor relationship falls apart, you're at jeopardy," he said.
Less mature, or "level one" partner relationships are often referred to as "Barney deals, (i.e., "I love you, you love me" relationships)," Wang wrote in a 2008 report.
Such pacts focus on marketing efforts, such as joint press announcements, versus product integrations, and users generally don't get much of a benefit.
More mature vendor-partner ecosystems will feature things like certified integration between products and a coordinated go-to-market strategy, according to Wang.
The most mature relationships see vendors and partners "share a joint product strategy and effort toward co-innovation," Wang wrote. "Go-to-market strategies focus on rapid implementation methodologies, centers of excellence, and shared training programs."
It's rare to see a partnership reach this level, and in many cases the vendor ends up acquiring the partner, he added.