VAR Sues Cisco Claiming Contract Breaches

However, on May 30, 2007, Cisco sent a letter to Infra-Comm advising that, because of the lawsuit, it would not renew the ICPA. Infra-Comm responded that it had already been renewed. Cisco said the renewal was automated and not valid, and on June 2 it terminated Infra-Comm's partner status under a clause in the ICPA that allows the vendor to terminate the ICPA "for convenience" within 30 days of renewal.

At the time of the ICPA cancellation, Infra-Comm had more than a dozen deals under OIP agreements with other customers that the solution provider could not pursue further, Hosinski said. It could, and did, follow up on other customer orders via Cisco distributors that didn't realize until late summer 2007 that Infra-Comm no longer was authorized as a partner.

By Hosinski's count, Cisco breached contracts with his company on three occasions: the first was breaching the OIP it had with Infra-Comm by letting AT&T take the deal; the second was terminating the other OIPs Infra-Comm had with signed with Cisco; the third was the cancellation of the ICPA.

Infra-Comm continued to work with the customer in question to implement the first and second phases of the Cisco IP telephony project despite the issues it had with Cisco until May of this year, Hosinski said.

Cisco declined to respond to questions about its relationship with Infra-Comm.

However, an industry source close to Cisco said one has to consider the possibility that it was the customer, not Cisco, who decided to go with AT&T and who passed details about the deal to AT&T.

That source also noted that deal-registration agreements do not grant an exclusive relationship between a customer and a solution provider. Instead, it guarantees that the signing partner gets exclusive discounts. Infra-Comm was a Premier or a Silver partner, whereas AT&T is a Gold partner, which could give it better pricing than Infra-Comm could get even with an OIP incentive.

Hosinski said he doesn't believe that the customer told AT&T the details of the deal. He said he has e-mails that came up through the discovery process that show that Cisco passed the Infra-Comm information to AT&T.

Regardless of how the lawsuit plays out, Infra-Comm is no longer the company it once was. From a peak of 12 employees and two offices, the company is now down to four employees and is run from home, Hosinski said.

The lawsuit is more than one company's fight against a large company like Cisco, Hosinski said.

"It's been a long road and a costly road," he said. "Other partners have had these same experiences. I feel like I need to stay in this for the other partners. We need to determine what OIPs and ICPAs mean. The only place where this can be determined is in the courts. It's a point of law."

Hosinski said he cannot walk away from this now. "If I walk away from this, someone else will have to start from square one," he said. "I feel there's a lot at stake, not just between myself and Cisco, but for the thousands of partners that engage with them."

As a result of this lawsuit, Cisco will be in the interesting position of having to argue about the value of solution provider partnerships, Hosinski said.

"Cisco's experts and our experts will have to value how Cisco values a Cisco Silver partnership," he said. "This is about partnership. We thought we were a real partner of Cisco. But Cisco now says we're not."

The lawsuit, now scheduled to go to court on Sept. 22, is a process that Infra-Comm is resolved to carry through, Hosinski said.

"My perspective from Cisco is, if they win, big deal," he said. "If they win, they lose. They can say, yeah, we crushed old Infra-Comm. But every partner should take notice of this. Maybe this could have been cleared up behind the curtains. But it wasn't. This is everything I have. I have nothing to lose. But I also think about other partners, and how it might affect them. Right now, I feel like Rocky going up against Apollo Creed."