Customer relationship management software company Salesforce.com has filed a lawsuit against competitor UpShot, alleging false advertising and unfair competition.
Salesforce.com argued that UpShot's tagline "The Better Online CRM Solution", is misleading because it implied UpShot's CRM services were superior to Salesforce.com's.
Salesforce.com is seeking unspecified damages and an injunction blocking UpShot from certain advertising claims.
"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," said UpShot chairman Keith Raffel.
The two rivals have already brought their conflict before the National Advertising Division (NAD) of the Council of Better Business Bureaux, which offers a dispute resolution system.
In a case report, NAD determined that UpShot had made unsupported claims about its "leading" market position and "better" products that went beyond general puffery and implied, without sufficient backing, superiority against Salesforce.com.
The organisation sided with UpShot on several of its 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.
Since UpShot is no longer running the ads in question, the company considers the matter irrelevant.
Salesforce.com is considered by industry analysts to be the market-share leader in the hosted CRM market, with UpShot holding the number-two position. Salesforce.com claims a customer base of 7,000 client companies and 90,000 end users. UpShot declined to disclose its customer numbers.
Stacy Cowley writes for IDG News Service