Zoom is suing RingCentral for what it is calling “a classic bait and switch” of customers.
The lawsuit centres on a longstanding relationship between Zoom and RingCentral which has seen RingCentral use Zoom’s technology in its video offering.
RingCentral has since launched its own video offering, RingCentral Video, and claims to be in the process of moving customers away from the Zoom-powered product, known as RingCentral Meetings.
However, Zoom claims that RingCentral is continuing to use its branding despite Zoom indicating last July that it would not be renewing the deal. It claims RingCentral is doing this with the intention of them moving customers to its own product.
The version of the court document that is circulating has been heavily redacted, appearing to omit information that is crucial to Zoom’s claims.
What is clear is that Zoom no longer wants RingCentral to sell the Meetings product and claims the firm is breaching its trademarks and copyright by doing so.
Zoom said in the filing: “RingCentral has embarked upon a campaign of misinformation designed to mislead customers, investors, and the public at large.”
It added that RingCentral is “falsely suggesting instead that RingCentral is transitioning customers to RingCentral Video for illusory quality or feature-based reasons”.
Zoom claims that the transition is for another reason, which hasn’t been divulged to customers. This reason has been redacted from the filing.
“These statements are belied by RingCentral’s insistence on continuing to sell Zoom’s products despite having its own available alternative,” the filing states.
“If RingCentral truly believed its video product was a quality replacement for Zoom’s product, then it would transition all of its customers with no further delay”
“Its failure to do so reveals that RingCentral believes the opposite to be true; Zoom’s products are the best in the market and provide the features RingCentral’s customers desire.”
Zoom added that RingCentral has performed a “classic bait and switch” by “dangling Zoom in front of potential customers to lure them into signing multiyear contracts”, presumably with the intention of them switching them over to the non-Zoom product.
It also quoted what it claimed to be a message from RingCentral to clients, which reveals that the firm will be migrating customers from RingCentral Meetings to RingCentral Video over the course of 2021.
Another component of Zoom’s claim focuses on non-compete clauses in the agreement between the pair which RingCentral has activated, banning Zoom from approaching RingCentral customers. Zoom claims these clauses are anti-competitive and unenforceable.
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RingCentral has posted a response to Zoom’s legal action on its website, saying Zoom is “motivated by fear” due to the uptake of RingCentral’s video offering and UCaaS platform.
“Zoom is attempting to restrict customer choice and to hinder competition,” RingCentral said.
“The plain truth is that Zoom cannot offer an integrated [mobile, video and phone] experience, and restraining RingCentral from using RingCentral Meetings (RCM) during the contractually agreed time period would limit customer choice.
“While even Zoom does not contend that our existing customer base is in any way impacted by this dispute, the lawsuit attempts to obstruct RingCentral’s efforts to complete the transition of its customer pipeline to RingCentral Video – a transition that is already well underway.
“We believe in fair competition, putting the customer first, investing in innovation and letting the market decide. Zoom’s actions show that it does not. We will remain focused on what our customers need, and we want our customers to know that nothing has changed in our agreements with them.”
This article has been updated to include RingCentral’s response
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