ZL V Gartner Appellee's Brief

Case: 10-16061 09/28/2010 Page: 1 of 76 ID: 7490389 DktEntry: 15
No. 10-16061
IN THE
FOR THE NINTH CIRCUIT
ZL TECHNOLOGIES, INC.,
Plaintiff-Appellant,
v.
GARTNER GROUP, INC. AND CAROLYN DICENZO,

Defendants-Appellees.
On Appeal from the United States District Court

For the Northern District of California
Hon. Jeremy Fogel, District Judge
ANSWERING BRIEF OF DEFENDANTS-APPELLEES
Robert P. Feldman
Daniel H. Bromberg
QUINN EMANUEL URQUHART
& SULLIVAN, LLP
555 Twin Dolphin Drive
5th Floor
Redwood Shores, CA 94065
(650) 801-5000
September 28, 2010

CORPORATE DISCLOSURE STATEMENT

Pursuant to Rule 26.1 of the Federal Rules of Appellate Procedure,
Defendants-Appellees Gartner, Inc., which is incorrectly identified in the caption
as Gartner Group, Inc., and Carolyn DiCenzo state that no publicly held
corporation owns more than 10% of Gartner, Inc.
i
TABLE OF CONTENTS
Page
CORPORATE DISCLOSURE STATEMENT ............................................... i
TABLE OF CONTENTS................................................................................ ii
TABLE OF AUTHORITIES ......................................................................... vi

PRELIMINARY STATEMENT .....................................................................1
JURISDICTION ..............................................................................................4
QUESTIONS PRESENTED............................................................................4
STATEMENT OF FACTS AND OF THE CASE ..........................................5

A. The Parties ...................................................................................6
B. The Magic Quadrant Reports ......................................................7

C. The Proceedings Below............................................................ 12
1. Plaintiff‟s Original Complaint ....................................... 12
2. The First Dismissal Order .............................................. 13

3. The Second Dismissal Order ......................................... 15
SUMMARY OF ARGUMENT .................................................................... 17

ARGUMENT ................................................................................................ 22
I. AS THE DISTRICT COURT CORRECTLY RECOGNIZED,

GARTNER‟S PLACEMENT OF PLAINTIFF IN THE
MAGIC QUADRANT DIAGRAM EXPRESSES A
PROTECTED OPINION.................................................................... 22
A. The First Amendment And California Law Protect

Statements If They Do Not Assert Or Imply Facts, Or If
They Are Not Sufficiently Factual To Be Proved True Or
False ......................................................................................... 22
TABLE OF CONTENTS
(continued)
Page
B. Plaintiff‟s Relative Placement In The Magic Quadrant

Diagram Expresses A Protected Opinion Because It
Asserts Gartner‟s Judgments Rather Than Actual Facts,
And Because It Is Not Sufficiently Factual To Be Proved
True Or False............................................................................ 27
1. The General Tenor Of The Magic Quadrant

Reports Plainly Informs Readers That The Reports
Assert Opinions.............................................................. 27
2. The Magic Quadrant Reports Also Plainly Inform

Readers That Placement In The Magic Quadrant
Diagram In Particular Is Based On Gartner‟s
Opinions ......................................................................... 29
3. Plaintiff‟s Placement In The Magic Quadrant

Diagram Is Not Sufficiently Factual To Be Proved
True Or False Because It Is Based Upon Abstract
Qualities Which Are Evaluated Based Upon
Qualitative Criteria Using Customer Opinions And
Other Qualitative Evidence............................................ 34
C. Courts Consistently Have Held That Evaluations
Analogous To Those In The Magic Quadrant Reports
Express Protected Opinions ..................................................... 37
II. THE MAGIC QUADRANT REPORTS CANNOT

REASONABLY BE INTERPRETED EITHER TO ASSERT
OR TO IMPLY THAT SYMANTEC‟S PRODUCTS ARE
SUPERIOR TO PLAINTIFF‟S PRODUCTS IN TERMS OF
OBJECTIVE PERFORMANCE MEASURES.................................. 40
iii
TABLE OF CONTENTS
(continued)
Page
A. The Magic Quadrant Reports Cannot Reasonably Be

Interpreted Either To Assert Or To Imply That
Symantec‟s Products Are Superior To Plaintiff‟s
Products .................................................................................... 41
1. The Magic Quadrant Reports Plainly Do Not

Assert That Symantec‟s Products Are Superior To
Plaintiff‟s Products ........................................................ 42
2. Plaintiff‟s Relative Placement In The Magic
Quadrant Diagram Cannot Reasonably Be
Interpreted To Imply That Symantec‟s Products
Are Superior To Plaintiff‟s Products ............................. 45
B. The Magic Quadrant Reports Cannot Reasonably Be

Interpreted To Assert That Plaintiff‟s Products Are
Inferior In Terms Of Objective Performance Because The
Reports Plainly State That Vendors Are Evaluated Based
Upon Consumer Opinions And Other Qualitative
Information Rather Than Product Testing Or Other
Analysis Of Objective Performance ........................................ 48
C. Plaintiff Has Not Alleged That Gartner Intended Or Was
Aware Of The Implication That Plaintiff‟s Products Are
Inferior In Terms Of Objective Performance........................... 52
D. Because The Magic Quadrant Reports Are Not

Reasonably Susceptible To The Interpretation Advanced
By Plaintiff, Plaintiff‟s Arguments Concerning
Disclaimer And Other Issues Are Inapposite........................... 53
III. DEFENDANTS DID NOT DEFAME PLAINTIFF BY
EQUATING ITS PRODUCTS WITH THE PRODUCTS OF
THE VENDOR THEY IDENTIFIED AS THE INDUSTRY
LEADER ............................................................................................ 60
iv
TABLE OF CONTENTS
(continued)
Page
CONCLUSION ............................................................................................. 62
CERTIFICATE OF COMPLIANCE WITH FRAP 32(a)(7)(C) AND
CIRCUIT RULE 32-1 ........................................................................ 63
REQUEST FOR ORAL ARGUMENT ........................................................ 64
STATEMENT OF RELATED CASES ........................................................ 65

CERTIFICATE OF SERVICE ..................................................................... 66
v
TABLE OF AUTHORITIES
Page
Cases
Ashcroft v. Iqbal,
129 S. Ct. 1937 (2009)....................................................................... 46, 53
Aviation Charter, Inc. v. Aviation Research Group/US,

416 F.3d 864 (8th Cir. 2005) ........................................... 28, 33, 35, 38, 39
Bergen v. Martindale-Hubbell, Inc.,

337 S.E.2d 770 (Ga. Ct. App. 1985) ....................................................... 38
Blatty v. New York Times Co.,

728 P.2d 1177 (Cal. 1986) ....................................................................... 22
Bose Corp. v. Consumers Union of United States, Inc.,

466 U.S. 46 (1984)................................................................................... 23
Browne v. Avvo, Inc.,

525 F. Supp. 2d 1249 (W.D. Wash. 2007) ............................ 28, 33, 37, 38
Canada Life Assurance Co. v. LaPeter,

563 F.3d 837 (9th Cir. 2009) ................................................................... 61
Coastal Abstract Serv., Inc. v. First American Title,
173 F.3d 725 (9th Cir. 1999) ............................................................. 46, 59
ComputerXpress, Inc. v. Jackson,
113 Cal. Rptr. 2d 625 (Ct. App. 2001) .................................................... 23
Compuware Corp. v. Moody’s Investors Servs., Inc.,

499 F.3d 520 (6th Cir. 2007) ............................................................. 38, 52
Condit v. Nat’l Enquirer, Inc.,

248 F. Supp. 2d 945 (E.D. Cal. 2002) ............................................... 44, 58
Flamm v. Am. Ass’n of Univ. Women,

201 F.3d 144 (2d Cir. 2000) .............................................................. 58, 59
(continued)
Page
Franklin v. Dynamic Details, Inc.,

10 Cal. Rptr. 3d 429 (Ct. App. 2004) ...................................................... 29
Gardner v. Martino,
563 F.3d 981 (9th Cir. 2009) ............................................................. 22, 26
Gertz v. Robert Welch, Inc.,

418 U.S. 323 (1974)................................................................................. 24
Gill v. Hughes,
278 Cal. Rptr. 306 (Ct. App. 1991) ......................................................... 58
Greenbelt Coop. Publ’g Ass’n, Inc. v. Bresler,

398 U.S. 6 (1970)..................................................................................... 25
Hoffman Co. v. E.I. Du Pont de Nemours, Inc.,
248 Cal. Rptr. 384 (Ct. App. 1988) ......................................................... 25
Hustler Magazine, Inc. v. Falwell,

485 U.S. 46 (1988)............................................................................. 23, 25
Indep. Towers of Wash. v. State of Wash.,
350 F.3d 925 (9th Cir. 2003) ................................................................... 61
Jefferson County Sch. Dist. No. R-1,
175 F.3d 848 (10th Cir. 1999) ........................................................... 30, 38
Jensen v. Hewlett-Packard Co.,

18 Cal. Rptr. 2d 83 (Ct. App. 1993) ....................................................... 23
Kaelin v. Globe Communications Corp.,

162 F.3d 1036 (9th Cir. 1998) ........................................................... 43, 44
Knievel v. ESPN,
393 F.3d 1068 (9th Cir. 2005) ............................................... 26, 44, 52, 56
vii
(continued)
Page
Letter Carriers v. Austin,

418 U.S. 264 (1974)................................................................................. 25
Lewis v. Time, Inc.,

710 F.2d 549 (9th Cir. 1983) ............................................................. 56, 59
Lowe v. SEC,
472 U.S. 181 (1985)................................................................................. 25
Manufactured Home Communities, Inc. v. County of San Diego,
544 F.3d 959 (9th Cir. 2008) ............................................................. 24, 56
Milkovich v. Lorain Journal Co.,

497 U.S. 1 (1990)............................................................. 23, 24, 25, 34, 53
Moldea v. New York Times Co.,
22 F.3d 310 (D.C. Cir. 1994) ................................................................... 26
Mzamane v. Winfrey,
693 F. Supp. 2d 442 (E.D. Pa. 2010) ................................................. 57, 58
New York Times Co. v. Sullivan,
376 U.S. 252 (1964)................................................................................. 24
Overstock.com, Inc. v. Gradient Analytics, Inc.,
61 Cal. Rptr. 3d 29 (Ct. App. 2007) ........................................................ 54
Partington v. Bugliosi,
56 F.3d 1147 (9th Cir. 1995) ..................................... 23, 24, 26, 32, 37, 44
Philadelphia Newspapers, Inc. v. Hepps,

475 U.S. 767 (1986)........................................................................... 24, 25
Pizza Hut, Inc. v. Papa John’s Int’l, Inc.,

227 F.3d 489 (5th Cir. 2000) ................................................................... 48
viii
(continued)
Page
In re Silicon Graphics Ins. Sec. Litig.,

183 F.3d 970 (9th Cir. 1999) ................................................................... 42
Standing Comm. on Discipline v. Yagman,

55 F.3d 1430 (9th Cir. 1995) ................................................. 34, 52, 54, 59
Steckman v. Hart Brewing, Inc.,

143 F.3d 1293 (9th Cir. 1998) ................................................................. 52
TMJ Implants, Inc. v. Aetna, Inc.,
405 F.Supp.2d 1242 (D. Colo. 2005) ...................................................... 31
Underwager v. Channel 9 Australia,

69 F.3d 361 (9th Cir. 1995) ............................................................... 26, 34
Unelko Corp. v. Rooney,
912 F.2d 1049 (9th Cir. 1990) ........................................................... 56, 57
In re Yagman,
796 F.2d 1165 (9th Cir. 1986) ................................................................. 29
Statutes
28 U.S.C. § 1291 ..............................................................................................4
28 U.S.C. § 1332 ..............................................................................................4

28 U.S.C. § 2107 ..............................................................................................4
ix
PRELIMINARY STATEMENT
Defendant Gartner, Inc. 1 is a research and advisory firm which
publishes reports about the information technology industry for a
sophisticated audience of technology professionals. One of the reports
annually published by Gartner evaluates vendors for enterprise-class, e-mail
archiving software. When large enterprises purchase e-mail archiving
software, they typically make multi-year commitments even though such
software is rapidly developing and changing. Accordingly, in evaluating
vendors, Gartner considers not only their products, but also sales and
marketing, financial strength, and other factors shedding light on the
vendors‟ long-term prospects and ability to adapt to changing requirements.
Plaintiff ZL Technologies, Inc. is a small, self-funded vendor of e-
mail archiving software. Plaintiff alleges that it has the best product in the
market, and in this case it blames its relative lack of success on its inferior
placement in the diagram in Gartner‟s Magic Quadrant Reports.
Accordingly, Plaintiff has sued Gartner for defamation and trade libel.
The district court (Fogel, J.) correctly dismissed these claims. To
prevent risk of liability from chilling the expression of opinions, both the
1
Although the caption refers to “Gartner Group, Inc.,” as the district
court recognized, the actual name of the defendant in question is “Gartner,
Inc.” ER 92, 138; see also Opening Br. 1 (referring to “Appellee Gartner,
Inc.”).
1
First Amendment and California law protect opinions from defamation and
trade libel claims. Gartner‟s evaluations of vendors in the Magic Quadrant
Reports are entitled to this protection for at least two reasons. First, in
placing vendors into the Magic Quadrant diagram, the Reports express
opinions rather than facts. The diagram maps abstract qualities, Ability to
Execute and Completeness of Vision, based upon multiple, largely
qualitative criteria chosen by Gartner and evaluated by Gartner from
customer opinions and other qualitative information. This highly subjective,
value-laden process yields opinions concerning vendors, not facts, and the
Magic Quadrant Reports make this crystal clear by informing readers that
the Reports contain “opinions” and that the Magic Quadrant diagram in
particular is shaped by Gartner‟s “views.”
Second, even if the Reports did not make it clear to readers that
placement in the Magic Quadrant diagram is based upon Gartner‟s opinions,
the placement of vendors in the diagram would be deemed an opinion as a
matter of law because those placements are not sufficiently factual to be
proved true or false and therefore cannot be treated as assertions of fact.
Although Plaintiff challenges its placement in the Magic Quadrant
diagram, it does not attempt to show that its placement is provably true or
false. Instead, Plaintiff argues that its relative placement either directly
2
asserts or implies that its products are inferior to the products of Symantec
Corporation in terms of objective performance. This argument fails as a
matter of law because the Magic Quadrant Reports, which are incorporated
by reference into the pleadings and therefore control over Plaintiff‟s contrary
allegations and assertions, are not reasonably susceptible to such a reading.
Indeed, Plaintiff does not—and cannot—point to anything in the Magic
Quadrant Reports either directly asserting or implying that Plaintiff‟s
products are inferior to Symantec‟s. And there is certainly nothing in the
Reports that suggests that Plaintiff‟s products are inferior in terms of
objective performance.
As Plaintiff admitted in its original complaint, at the core of this
action is a disagreement over Gartner‟s model for evaluating vendors, which
emphasizes factors such as marketing and sales rather than relying solely
upon objective performance. By contending that the Magic Quadrant
Reports assert or imply that its products are inferior in terms of objective
performance, Plaintiff is trying to avoid the constitutional protections
afforded Gartner‟s opinions concerning how vendors should be evaluated.
Because the Reports are not reasonably susceptible to the interpretation that
Plaintiff now ascribes to them, Plaintiff should not be permitted to make
3
such an end run around the First Amendment. The judgment below should
be affirmed.
JURISDICTION
Defendants-Appellees Gartner, Inc. and Carolyn DiCenzo agree with
Plaintiff that the district court had subject matter jurisdiction over the claims
at issue on appeal under 28 U.S.C. § 1332, that Plaintiff‟s notice of appeal
was timely under 28 U.S.C. § 2107, and there is appellate jurisdiction under
28 U.S.C. § 1291.
QUESTIONS PRESENTED
1. Whether the First Amendment and California law permit
defamation and trade libel claims based upon Plaintiff ZL Technologies,
Inc.‟s placement in the Magic Quadrant diagram in relation to another e-mail
archiving software vendor where (a) that placement is made according to
qualities chosen and defined by Gartner, based upon largely, if not entirely,
qualitative criteria chosen by Gartner, which Gartner evaluated based upon
customer opinions and other qualitative information; (b) Gartner describes
the process by which it evaluates vendors and places them in the Magic
Quadrant diagram; and (c) it informs its readers that the Magic Quadrant
Reports contain “opinions” and that vendor placements in the diagram in
particular reflect Gartner‟s “views.”
4
2. Whether Gartner‟s Magic Quadrant Reports reasonably can be
interpreted to assert or imply that Plaintiff‟s e-mail archiving software is
inferior to the software of its competitor Symantec Corporation in terms of
objective performance where the Reports (a) expressly state that they place
vendors rather than products in the Magic Quadrant diagram; (b) state that a
vendor‟s products are only one of many criteria considered in making
placements; (c) further state that those criteria were based upon customer
opinions and other qualitative information rather than product testing or
other analyses of objective performance; and (d) praise the performance of
Plaintiff‟s products while criticizing aspects of the performance of
Symantec‟s products.
3. Whether Defendants defamed Plaintiff by stating that its
products are “the same” as Symantec‟s products when Defendants have
designated Symantec as the leader in the e-mail archiving software market.
STATEMENT OF FACTS AND OF THE CASE

Plaintiff‟s opening brief does not accurately describe the Magic
Quadrant Reports or the statements made in those Reports. The brief also
does not accurately describe the reasons why the district court held those
statements to be protected opinions. It therefore is necessary to restate the
facts and the case.
5
A. The Parties
Plaintiff ZL Technologies, Inc. makes and sells to large enterprises e-
mail archiving software, which allows those enterprises efficiently to store,
index, and extract e-mail and other electronic data. ER 115, 139. Unlike
most high-tech companies, Plaintiff has forgone venture capital funding so
that it can focus on product development without concern for the short-term
needs of venture capitalists. ER 116.
Plaintiff alleges that it has the strongest e-mail archiving products in
the market. ER 116. According to Plaintiff, its products outperform its
competitors‟ products by significant performance measures such as search
accuracy, search speed, and completeness of search. Id. Plaintiff also says
that its products are more scalable and offer more features, that it provides
better customer service, and that its customers include some of the world‟s
largest enterprises. ER 116-17.
Nonetheless, Plaintiff‟s sales trail behind those of larger competitors
such as Symantec Corporation. ER 117. Plaintiff points to Defendant
Gartner, Inc. as the explanation for its trailing sales. Gartner is a leading
information technology and advisory company, which provides research and
analysis of the information technology industry to large corporate and
government enterprises. Id. Plaintiff alleges that many such enterprises rely
6
heavily on Gartner‟s advice in deciding which e-mail archiving software to
purchase and that Plaintiff has lost sales as a result of that advice. ER 117-
18, 132.
B. The Magic Quadrant Reports

In particular, Plaintiff complains about the Magic Quadrant Reports
that Gartner publishes. An important part of Gartner‟s business is
publishing reports about various technology markets, including the e-mail
archiving market. ER 118. Like most of Gartner‟s Magic Quadrant Reports,
the Reports concerning e-mail archiving contain a “Magic Quadrant”
diagram, which has an axis labeled “Ability to Execute” and another labeled
“Completeness of Vision.” ER 43, 58, 75. The diagram also is divided into
four quadrants—Leaders, Challengers, Visionaries and Niche Players—and
each vendor selected to appear in the Reports is placed into one of these
quadrants. Id.
As the Reports explain, Leaders are vendors with the highest
combined scores on the two axes in the Magic Quadrant diagram, and they
have the most comprehensive and most scalable products as well as a proved
record of financial performance and the ability “to anticipate and begin to
deliver on future requirements.” ER 46, 62, 79. Challengers have the
products and resources to become leaders, but have failed to demonstrate the
7
understanding of market trends and requirements needed to succeed in the
future. ER 47, 63, 80. Visionaries are innovative and forward-thinking but
lack comprehensive products or the sales and marketing success to become
leaders. Id. And Niche Players are either narrowly focused or have broad
capabilities but lack the success of vendors in other quadrants. Id.
The Reports also explain the process by which vendors are selected
and placed onto the Magic Quadrant diagram. Even to qualify for selection,
a vendor must meet certain requirements, and it must prove, through
customer references, its ability to support large enterprises. ER 42, 57, 74.
In placing vendors in the Magic Quadrant diagram, Gartner evaluates them
in terms of their Ability to Execute and their Completeness of Vision, the
two axes in the diagram. Ability to Execute is evaluated in light of seven
criteria—Product/Service, Overall Viability, Sales Execution/Pricing,
Market Responsiveness and Track Record, Marketing Execution, Customer
Experience, and Operations—which are weighted low, standard, or high.
ER 45-46, 61-62, 77-78; see also ER 53-54, 70-71, 77-78 (defining the
individual criteria). Completeness of Vision is likewise evaluated in light of
seven (different) criteria weighted low, standard, or high. ER 46, 62, 78-79;
see also ER 54, 71, 78-79 (defining criteria).
8
The Reports include comment on each of the selected vendors. In a
section entitled “Vendor Strengths and Cautions,” the Reports have two
bullet points with strengths and two with cautions for each vendor. ER 48-
53, 64-69, 80-89. Additional comments on some vendors are included in the
discussion of the four quadrants, ER 62-64, 79-80, or in the “Vendor
Strengths and Cautions” section before the bullet points, ER 80-89.
The 2007 Report—The 2007 Report categorized Plaintiff as a Niche
Player. ER 43. It noted that Plaintiff had “begun to get some market
traction” but observed that Plaintiff was still challenged with meeting the
requirements of the financial customers it had targeted, which limited its
ability to address a broader market. ER 48. Although the Report listed the
ability of Plaintiff‟s products to support compliance review as a strength, it
stated that Plaintiff‟s references were as yet too small or too new to
demonstrate its products‟ scalability and mailbox management capabilities.
ER 53. Nine other vendors, including IBM and Hewlett Packard, also were
placed in the Niche Players category. ER 43.
The 2007 Report categorized Symantec alone as a Leader. ER 43.
The Report stated that Symantec was far ahead of other vendors in its ability
to anticipate market requirements and to deliver new features. ER 46. The
Report also noted Symantec‟s continued enhancements and large base of
9
customers advising it on changing requirements as strengths. ER 52. The
Report warned readers, however, that they should plan very large
installments carefully and that Symantec did not provide mailbox
management for one e-mail system. Id.
The 2008 Report—Like the 2007 Report, the 2008 Report designated
Symantec as the sole Leader, and it placed Plaintiff in the Niche Players
category along with ten other vendors. ER 58. The Report noted that
Plaintiff had “stronger and larger references” which praised several aspects
of its products and that Plaintiff‟s discovery offering was strong, ER 63, 69,
but it cautioned that there was still limited information about Plaintiff‟s
products and that Plaintiff was “primarily a product- and engineering-
focused company,” which lacked the visibility and sales channels to remain
a viable vendor in the market, ER 69.
The 2008 Report also contained several warnings about Symantec‟s
products. The Report cautioned readers that one of Symantec‟s products
was new and should be carefully tested. ER 68. The Report also warned
readers that Symantec‟s inability to perform searches within searches “may
be problematic” for large deployments. Id.
In addition, the 2008 Report further explained how Gartner evaluates
vendors and places them in the Magic Quadrant diagram. “Placement on the
10
Magic Quadrant,” the Report explained, “is based on Gartner‟s view of the
vendor‟s performance against the criteria listed,” which in turn is based upon
interviews with Gartner customers, survey responses, and conversations with
vendor-supplied references. ER 58.
2009 Report—The 2009 Report once again designated Symantec a
Leader (though not the sole one this time), and Plaintiff was designated as a
Niche Player along with thirteen other vendors. ER 75. The Report
provided additional praise for Plaintiff‟s products, noting that they offer
“fast access to data in very large archive repositories” and that Plaintiff‟s
clients were happy “with product features, scalability, and efficient use of
infrastructure resources.” ER 89. The Report still cautioned, however, that
Plaintiff needed to invest more in marketing and expand its sales channels.
Id.
With respect to Symantec, the 2009 Report warned that one of
Symantec‟s products should be “carefully reviewed” to see if it “meets the
organization‟s requirements as delivered.” ER 88.
The 2009 Report also stressed that Gartner‟s vendor evaluations are
not based solely upon the vendor‟s products: “[i]t is important to remember
that the Magic Quadrant does not just rate product quality or capabilities.”
ER 75. A vendor‟s ability to capture customers and expand its market
11
presence, the Report explained, also is important because “[a] vendor that
builds a strong product but is unable or unwilling to also invest in marketing
and sales to capture a growing base of customers will find itself unable to
invest in future development.” Id.
C. The Proceedings Below

On May 29, 2009, less than two weeks after the 2009 Magic Quadrant
Report was issued, Plaintiff sued Gartner and Defendant Carolyn DiCenzo,
Gartner‟s lead analyst on the e-mail archiving software market and the lead
author of the Reports on that market. ER 1, 41, 56, 73, 115.
1. Plaintiff’s Original Complaint

In its original complaint, Plaintiff asserted claims for defamation and
trade libel as well as false advertising, unfair competition, and negligent
interference with prospective economic advantage. ER 1-37, 92. Plaintiff
alleged that Defendants had defamed and libeled it by placing it in the Niche
Player quadrant in the Magic Quadrant diagram. ER 11-13. In addition,
Plaintiff alleged that it was defamed when Defendant DiCenzo told
prospective customers that Plaintiff‟s products “were the same” as
Symantec‟s. ER 13; see also id. (challenging the 2008 Report‟s criticism
that Plaintiff needed to gain greater visibility and expand its sales channels).
12
The original complaint acknowledged that “[a]t the core of this
action” is “an economic model championed by Defendants that elevates
marketing puffery over serious technology.” ER 6. According to Plaintiff,
“by giving undue weight to sales and marketing,” Gartner biased its rankings
in favor of big companies with large sales and marketing budgets. Id.
Plaintiff also criticized the Magic Quadrant diagram for being “highly
subjective,” being based upon “misguided analytical models,” and lacking
any disclosed “mathematical discipline or process.” ER 6-7, 27. Finally
Plaintiff criticized Defendants for not engaging in any “independent testing”
of products and making “outrageously wrong” product assessments. ER 6, 9.
2. The First Dismissal Order

Defendants requested that the district court take judicial notice of the
2007-09 Reports challenged by Plaintiff, which were referenced but not
attached to the complaint, and moved to dismiss. See ER 38-91. The court
granted the request for judicial notice, and in a thorough twenty-two page
opinion, the district court granted the motion, holding that the statements
challenged by Plaintiff were protected opinions. ER 92-113.
The district court found that both the general tenor of the Magic
Quadrant Reports and the specific content of the diagram showed that
Plaintiff‟s relative placement in the Magic Quadrant diagram asserted
13
Gartner‟s opinions rather than any objective facts. ER 101-03. The court
found that “Gartner unambiguously presents the [Magic Quadrant] as a
reflection of its subjective „views‟ or „opinions,‟ not as objective facts.” ER
101. The Reports, the court observed, state that they express “opinions” and
that the Magic Quadrant diagram reflects Gartner‟s “views” with respect to
vendor placement Id. In addition, the Magic Quadrant diagram‟s Ability-to-
Execute and Completeness-of-Vision axes are “subjective on their face,” ER
103, and vendors are placed along those axes based upon multiple criteria,
which Gartner evaluates, not through product performance testing but rather
conversations with customers and vendor-supplied references, as well as
surveys completed by vendors, ER 101-02.
The district court also held that Gartner‟s vendor evaluations were not
susceptible to being proved true or false. ER 103-05. The court noted that,
contrary to Plaintiff‟s assertions, Gartner never said Plaintiff‟s products were
significantly inferior to Symantec‟s products. ER 103-04. In addition, the
Court found that Gartner‟s placement of vendors in the Magic Quadrant
diagram was “based upon its review of multiple criteria and its application
of relative weights to what it considers important to a vendor‟s „Ability to
Execute‟ and „Completeness of Vision.‟” ER 105. This relative weighting,
the Court concluded, was “a purely subjective determination that cannot be
14
proved true or false and upon which reasonable persons can disagree.” ER
105 n.5.
Finally, the district court also held that Defendants‟ statement that
Plaintiff‟s products and Symantec‟s products were “the same” was not
defamatory “given Symantec‟s prestigious rating as a „Leader.‟” ER 106;
see also id. (holding the statements to be an opinion). Plaintiff‟s remaining
claims, none of which Plaintiff has advanced on appeal, were dismissed as
well. See ER 97-98 (Lanham Act claim); ER 105-06 (statements that
Plaintiff needed to gain greater visibility and expand its sales channels); ER
107-10 (false advertising, unfair competition, and negligent interference
claims).
3. The Second Dismissal Order

Relying upon Plaintiffs‟ representation that its continuing
investigation had uncovered additional facts supporting its defamation and
trade libel claims, the district court reluctantly granted Plaintiff leave to
amend those claims. ER 110-12. In its amended complaint, Plaintiff alleged
that the Magic Quadrant Reports were based on facts not disclosed in the
Reports. ER 122-25. Plaintiff also alleged that Gartner had stated that
Niche Players that do not serve a small segment of the market are
“unfocused and do[] not outinnovate others.” ER 119. Defendants once
15
again moved to dismiss, and the district court granted the motion, this time
without leave to amend. ER 138-61.
The district court rejected Plaintiff‟s contention that Gartner‟s
placement of vendors in the Magic Quadrant diagram was actionable
because it is based upon facts that were not disclosed in the Reports. The
Court observed that “[m]ost opinions are based at least in part on facts” and
that the fact that Gartner considered facts in forming its opinion “does not
mean that the opinions are objectively verifiable.” ER 153. The Court
further found that Plaintiff had failed to demonstrate that any facts
reasonably implied from the Reports were verifiable. ER 158-59.
The district court also rejected Plaintiff‟s argument that its designation
as a Niche Player implied that it did not “outinnovate or outperform” other
vendors. ER 155-56. Plaintiff asserted in its briefing that Gartner had stated
that unless Niche Players focused upon a small market segment, they do not
outinnovate or outperform other vendors. ER 119. The district court
rejected this assertion because “this interpretation cannot be found anywhere
in the [Magic Quadrant] Reports.” ER 155. Indeed, the court observed that
Plaintiff‟s argument was inconsistent with the praise for Plaintiff‟s products
in the Reports. ER 156.
16
Finally, the district court once again rejected Plaintiff‟s claim that
Defendants defamed it by asserting that Plaintiff‟s product was “the same”
as Symantec‟s. This statement, the Court held, was too general to assert
facts that could be proved true or false. ER 150. In addition, the court
reaffirmed that, coming from Defendants which had designated Symantec as
a Leader in the e-mail archiving market, the statement was not defamatory.
ER 150 n.2.
SUMMARY OF ARGUMENT
The district court correctly held that Gartner‟s relative placement of
Plaintiff in the Magic Quadrant diagram is not actionable because it
expresses opinions rather than any facts that are provably true or false.
Plaintiff‟s argument on appeal—that its relative placement in the diagram
implies that its products are inferior to Symantec‟s products in terms of
objective performance—fails as a matter of law because, among other things,
the diagram is not reasonably susceptible to the reading that Plaintiff‟s
products are inferior or to the inference that Gartner evaluated the objective
performance of the products.
1. The placement of vendors in the Magic Quadrant diagram
expresses Gartner‟s opinions about vendors on an overall basis rather than
any facts that may be challenged in a defamation or trade libel claim.
17
Both the First Amendment and California law, which largely parallels
the First Amendment in this area, protect opinions from defamation and
trade libel claims. Although the First Amendment does not immunize
everything that may be described as an opinion from suit, it does provide
two important protections. First, and foremost, a statement is not actionable
unless it is sufficiently factual to be proved true or false. Second, a
statement is not actionable unless it is reasonably understood to assert actual
facts rather than opinions. Both of these protections apply here.
In the first place, Plaintiff‟s relative placement in the Magic Quadrant
diagram cannot reasonably be understood to assert or imply any actual facts.
As the Reports inform readers, the diagram places vendors in accordance
with two abstract qualities, Ability to Execute and Completeness of Vision,
defined by Gartner. These qualities are in turn evaluated by Gartner using
fourteen criteria defined by it, which are largely if not entirely qualitative in
nature and which are assessed by Gartner based upon customer opinions it
gleans from interviews and other qualitative information. As Plaintiff
acknowledged in its original complaint, this complex, value-laden process is
plainly subjective and open to debate. Moreover, the Reports dispel any
possible uncertainty about the nature of the diagrams by stating that the
18
Reports contain “opinions” and that the diagrams in particular reflect
Gartner‟s “views” about placement.
The relative placement of Plaintiff in the Magic Quadrant diagram
also must be deemed to be a non-actionable opinion as a matter of law
because it is not sufficiently factual to be proved true or false. There is no
objective way to prove whether Plaintiff is a better e-mail archiving vendor
than Symantec because the criteria for assessing vendors is open to debate.
Plaintiff contends that objective performance measures such as speed and
accuracy should be the primary, if not exclusive, determinant. Gartner
disagrees: because e-mail archiving is a fast-changing market, Gartner
believes that a vendor‟s long-term ability to respond to new developments
and produce new products is crucial. Gartner therefore evaluates, among
other things, a vendor‟s ability to innovate, its sales and marketing
capabilities, and its financial strength. These are plainly matters of opinion
which juries cannot and should not resolve. For this reason as well,
Plaintiff‟s relative placement in the Magic Quadrant diagram is not
actionable.
This conclusion is consistent with precedent. Several other circuits
have considered defamation challenges to publications that offer various
types of rankings and ratings. In each case, the court of appeals held that the
19
evaluations expressed protected opinions because they were based upon
subjective interpretation of data. Gartner‟s evaluations are even more
complex and value-laden than the evaluations considered in those cases and
therefore even more clearly express protected opinions.
2. Plaintiff‟s primary argument on appeal is that its relative
placement in the Magic Quadrant diagram indicates that Plaintiff‟s products
are inferior to Symantec‟s products in terms of objective performance
measures. This argument fails as a matter of law for three separate reasons.
First, the Magic Quadrant Reports cannot reasonably be interpreted as
either asserting or implying that Plaintiff‟s products are inferior to
Symantec‟s products. The Reports do not expressly state that Plaintiff‟s
products are inferior: the Magic Quadrant diagram compares vendors on an
overall basis, not products, and products are only one of fourteen criteria
considered in evaluating vendors. Similarly, because of the number of
criteria used to evaluate vendors, it cannot be inferred that Plaintiff‟s relative
placement is the result of its products or any other criteria.
Second, the Magic Quadrant Reports do not make any assertions,
whether express or implied, concerning objective performance. Although
one of the factors considered by Gartner in evaluating vendors is their
“Product/Service,” there is no indication in the definition of this criterion
20
that Gartner considers objective performance. Moreover, the Reports state
that Gartner‟s views are based upon interviews with customers and surveys
filled out by vendors, not any product testing or other analysis of objective
performance. Absent any indication that Gartner found that Plaintiff‟s
product is inferior in terms of objective performance, any statement by
Gartner about product quality is too vague to be proved true or false and
therefore must be deemed a protected opinion.
Third, even if the Magic Quadrant Reports could somehow be
interpreted to imply that Plaintiff‟s products are inferior in terms of objective
performance, Plaintiff‟s claims would still fail because it has not alleged that
Gartner either intended or knew about this implication.
3. Plaintiff also argues that the district court erred in holding that
statements by Defendants DiCenzo and Gartner that its product was “the
same” as Symantec‟s product was not sufficiently factual to be proved true
or false. Plaintiff asserts that Defendants‟ statements were understood to
mean that Plaintiff‟s and Symantec‟s products are the same in terms of
features and objective performance. But Plaintiff offers only conclusory
allegations to support this assertion. Even more important, Plaintiff fails to
address the district court‟s alternative ruling that this statement is not
21
defamatory in light of Defendants‟ consistent recognition of Symantec as the
market leader, thereby waiving any appeal from that ruling.
ARGUMENT
I. AS THE DISTRICT COURT CORRECTLY RECOGNIZED,

GARTNER’S PLACEMENT OF PLAINTIFF IN THE MAGIC
QUADRANT DIAGRAM EXPRESSES A PROTECTED
OPINION.
The Magic Quadrant diagram in Gartner‟s Reports does not assert any
actionable facts. Instead, it expresses Gartner‟s opinions concerning e-mail
archiving vendors on an overall basis. Both the First Amendment and
California law protect these opinions from defamation and trade libel claims
because the Magic Quadrant Reports plainly inform readers that the
diagrams express opinions, and because the relative placement of vendors in
the diagram is not sufficiently factual to be proved true or false and therefore
must be deemed as a matter of law to be protected opinions.
A. The First Amendment And California Law Protect

Statements If They Do Not Assert Or Imply Facts, Or If
They Are Not Sufficiently Factual To Be Proved True Or
False.
Both the First Amendment and California law bar defamation and
trade libel claims challenging judgments that either do not assert facts or are
not sufficiently factual to be proved true or false. See, e.g., Gardner v.
Martino, 563 F.3d 981, 986-87 (9th Cir. 2009) (First Amendment); Blatty v.
New York Times Co., 728 P.2d 1177, 1181-82 (Cal. 1986) (California
22
Constitution); ComputerXpress, Inc. v. Jackson, 113 Cal. Rptr. 2d 625, 641-
42 (Ct. App. 2001) (trade libel); Jensen v. Hewlett-Packard Co., 18 Cal.
Rptr. 2d 83, 88-89 (Ct. App. 1993) (defamation).
As the Supreme Court has recognized, “[a]t the heart of the First
Amendment is the recognition of the fundamental importance of the free
flow of ideas and opinions on matters of public interest and concern.”
Hustler Magazine v. Falwell, 485 U.S. 46, 50 (1988); see also Bose Corp. v.
Consumers Union of United States, Inc., 466 U.S. 485, 503-04 (1984)
(“[T]he freedom to speak one‟s mind is not only an aspect of individual
liberty—and thus a good unto itself—but also is essential to the common
quest for truth and the vitality of society as a whole.”). Opinions play an
important role in a system of free expression because they express different
viewpoints, encourage robust debate, and fuel discourse where the actual
facts are uncertain or unverifiable. See, e.g., Milkovich v. Lorain Journal
Co., 497 U.S. 1, 34-35 (1990) (Brennan, J., dissenting); Partington v.
Bugliosi, 56 F.3d 1147, 1154 (9th Cir. 1995).
Speakers need “breathing space” in which to express their opinions
without fear that they will be dragged in front of a jury with the power to
impose damages upon them because it disagrees with their opinions.
Partington, 56 F.3d at 1159. Accordingly, “the First Amendment requires
23
that the courts allow latitude for interpretation” and give speakers “the
interpretive license that is necessary when relying upon ambiguous sources.”
Id. at 1154 (citations omitted). “However pernicious an opinion may seem,
we depend for its correction not on the conscience of judges and juries but
on the competition of other ideas.” Gertz v. Robert Welch, Inc., 418 U.S.
323, 339-40 (1974); see also New York Times Co. v. Sullivan, 376 U.S. 254,
292 n.30 (1964) (“[A] defense of fair comment must be afforded for honest
expression of opinion based upon privileged, as well as true statements of
fact”). California law affords opinions similar protection. See, e.g.,
Manufactured Home Communities, Inc. v. County of San Diego, 544 F.3d
959, 963 (9th Cir. 2008).
These protections do not extend to everything that might be described
as an opinion. Recognizing that “expressions of „opinion‟ may often imply
an assertion of objective fact,” the Supreme Court refused in Milkovich v.
Lorain Journal Co. to create “an artificial dichotomy between „opinion‟ and
fact.” 497 U.S. at 18-19. Nonetheless, the Supreme Court recognized that
opinions enjoy two significant protections. Id. at 19.
First, and according to the Supreme Court “[f]oremost,” the First
Amendment protects opinions from suit if they cannot be proved true or
false. Id. at 19-20. In Philadelphia Newspapers, Inc. v. Hepps, 475 U.S.
24
767 (1986), the Supreme Court considered whether a State may require
speakers to prove the truth of statements on matters of public concern.
Finding that such a requirement would impermissibly chill speech, the Court
held that the burden of proving falsity must be borne by the party suing for
defamation. Id. at 776-77. In Milkovich, the Supreme Court observed that
Hepps‟ fault requirement protects opinions by barring defamation claims
that challenge opinions unless those opinions are “sufficiently factual to be
susceptible of being proved true or false.” 497 U.S. at 21; see also Lowe v.
SEC, 472 U.S. 181, 210 n.58 (1985) (noting that this protection extends to
opinions concerning commercial products); Hoffman Co. v. E.I. Du Pont de
Nemours & Co., 248 Cal. Rptr. 384, 392 (Ct. App. 1988) (recognizing that
opinions asserted by non-media defendants are protected).
Second, the First Amendment protects opinions if they do not assert
actual facts. The Supreme Court long has recognized that the First
Amendment protects parody and rhetorical hyperbole if such statements
“could not reasonably have been interpreted as stating actual facts.”
Falwell, 485 U.S. at 50; accord Letter Carriers v. Austin, 418 U.S. 264, 284-
86 (1974); Greenbelt Coop. Publ’g Ass’n, Inc. v. Bresler, 398 U.S. 6, 13
(1970). In Milkovich, the Supreme Court found that these cases establish the
general principle that “statements that cannot reasonably be interpreted as
25
stating actual facts” are protected from suit. 497 U.S. at 20 (quotation marks
omitted). This principle applies not only to parodies and hyperbole, but also
where “it is plain that the speaker is expressing a subjective view, an
interpretation, a theory, conjecture, or surmise” rather than actual facts.
Gardner, 563 F.3d at 989 (quotation marks omitted); see also Partington, 56
F.3d at 1156-57 (applying principle to interpretations based upon disclosed
facts); Moldea v. New York Times Co., 22 F.3d 310, 313 (D.C. Cir. 1994)
(applying principle to literary criticism).
Combining the principle that only opinions asserting actual facts are
actionable with the requirement that opinions must be provably true or false
to be actionable, this Court has formulated a three-part test for identifying
protected opinions:
First, we look at the statement in its broad context, which

includes the general tenor of the whole work, the subject of the
statements, the setting, and the format of the work. Next, we
turn to the specific content and context of the statement,
analyzing the extent of figurative or hyperbolic language used
and the reasonable expectations of the audience in that
particular situation. Finally, we inquire whether the statement
itself is sufficiently factual to be susceptible of being proved
true or false.
Underwager v. Channel 9 Australia, 69 F.3d 361, 366 (9th Cir. 1995);
accord Gardner, 563 F.3d at 987; Knievel v. ESPN, 393 F.3d 1068, 1075
(9th Cir. 2005); Partington, 56 F.3d at 1153.
26
B. Plaintiff’s Relative Placement In The Magic Quadrant

Diagram Expresses A Protected Opinion Because It Asserts
Gartner’s Judgments Rather Than Actual Facts, And
Because It Is Not Sufficiently Factual To Be Proved True
Or False.
Gartner‟s relative placement of Plaintiff in the Magic Quadrant
diagram is a protected opinion for two reasons. First, as the district court
recognized, “Gartner unambiguously presents the [Magic Quadrant] results
as a reflection of its subjective „views‟ and „opinions.‟” ER 152. Second
because Gartner places vendors based upon abstract qualities defined by it
and because those qualities are evaluated using multiple, largely qualitative
criteria selected by it and assessed based upon customer opinions and other
qualitative evidence rather than product testing or other objective measures,
Plaintiff‟s relative placement is not sufficiently factual to be proved true or
false.
1. The General Tenor Of The Magic Quadrant Reports

Plainly Informs Readers That The Reports Assert
Opinions.
The general tenor of the Magic Quadrant Reports plainly indicates
that they assert opinions rather than facts. The Reports‟ fanciful title—the
Magic Quadrant Report—suggests that the Reports assert opinions rather
than facts. The categories into which the Reports place vendors—Leaders,
Challengers, Visionaries, and Niche Players (ER 46-47, 62-63, 79-80)—
27
reinforce this impression because the categories are abstract and descriptive
rather than narrow and empirical in nature. See Browne v. Avvo, Inc., 525 F.
Supp. 2d 1249, 1252 (W.D. Wash. 2007) (noting that “fuzzy descriptive
phrases like „superb,‟ „good,‟ and „strong caution‟” suggest subjective
assessments). And the impression that the Reports express opinions is
deepened by the statement on the cover page of the Reports that “[t]he
opinions expressed herein are subject to change without notice.” ER 41, 56,
73 (emphasis added).
Plaintiff argues that the Magic Quadrant Reports cannot be
understood as “mere opinion.” Opening Br. 27. Noting statements by
Gartner that it provides “objective” and “fact-based” research, ER 121-22,
and alleging that Gartner has said that the placement of vendors in the Magic
Quadrant diagram is based on a “rigorous mathematical model,” Plaintiff
asserts that readers expect the Reports to provide “cold hard facts” rather
than “stylized commentary” or “artistic prose.” Opening Br. 26-27, 29.
This is a false dichotomy. The First Amendment‟s protection of opinion is
not limited to frivolous or purely aesthetic matters. To the contrary, it
extends to opinions on undeniably serious matters such as the safety of
airplanes, see Aviation Charter, Inc. v. Aviation Research Group/US, 416
F.3d 864, 870-71 (8th Cir. 2005), and the commission of crimes, see In re
28
Yagman, 796 F.2d 1165, 1171-76 (9th Cir. 1986); Franklin v. Dynamic
Details, Inc., 10 Cal. Rptr. 3d 429, 437-41 (Ct. App. 2004). Thus, the
serious nature of the Magic Quadrant Reports does not negate the clear
indication that the Reports assert Gartner‟s opinions.
2. The Magic Quadrant Reports Also Plainly Informs

Readers That Placement In The Magic Quadrant
Diagram In Particular Is Based On Gartner’s
Opinions.
In addition to informing readers that they contain opinions, the Magic
Quadrant Reports also plainly inform them that Gartner‟s placement of
vendors in the Magic Quadrant diagram is based upon Gartner‟s opinions.
First, the Reports place vendors in the Magic Quadrant diagram based
upon two abstract qualities selected by Gartner: the Ability to Execute and
Completeness of Vision. ER 43, 58, 75. Like the abstract, qualitative
categories of Leaders, Challengers, Visionaries, and Niche Players into
which vendors are placed, the abstract nature of these qualities indicates that
the placement of vendors according to them reflects opinions rather than
actual facts. See supra pp. 27-28.
Second, as the Reports disclose, these abstract qualities are evaluated
based upon multiple criteria selected by Gartner. For example, a vendor‟s
Completeness of Vision is based upon seven criteria: Market Understanding,
Marketing Strategy, Sales Strategy, Offering Strategy, Vertical/Industry
29
Strategy, Innovation, and Geographic Strategy. ER 46, 62, 79; see also id.
(noting that the vendor‟s “Business Model” is not rated). A vendor‟s Ability
to Execute is likewise based upon multiple criteria: Product/Service, Overall
Viability, Sales Execution/Pricing, Market Responsiveness and Track
Record, Marketing Execution, Customer Experience, and Operations. ER
45-46, ER 61-62, 77-78.
These criteria are largely, if not entirely, qualitative. Forward-looking
criteria such as marketing and sales strategy are plainly qualitative. Under
certain circumstances, other criteria such as Product/Service or Marketing
Responsiveness and Track Record might be more quantitative. But, as the
district court observed, nothing in the Reports suggests that Gartner
performed any testing or verification. ER 102. To the contrary, the Reports
define these criteria in qualitative rather than objective or quantitative
fashion. ER 53-54, 70-71, 77-79. Most significantly, the Product/Service
criterion is defined, not in terms of objective measures, but rather as the
“[c]ore goods and services offered by the vendor,” including “current
product/service capabilities, quality, feature sets, skills, etc.” ER 53, 70.
As courts have recognized, assessment based upon the analysis of
multiple factors, many if not all of which are subjective in nature, are not
provably true or false. See Jefferson County Sch. Dist. No. R-1 v. Moody
30
Investor Serv., Inc., 175 F.3d 848, 855-56 (10th Cir. 1999); TMJ Implants,
Inc. v. Aetna, Inc., 405 F.Supp.2d 1242, 1252 (D. Colo. 2005).
Third, Gartner evaluates the criteria identified in the Reports based
upon the opinions of customers and other qualitative evidence, not
performance testing or other quantitative information. For example, vendors
were included in the Magic Quadrant Reports not based upon meeting
certain performance benchmarks but rather based upon “strong references”
demonstrating their ability to satisfy the needs of large enterprises. ER 42,
57, 74. Similarly, the 2008 and 2009 Reports state that the placement of
vendors in the Magic Quadrant diagram is based upon “conversations over
this past year with Gartner customers” and “conversations with vendor-
supplied references”—that is, the opinions of customers using the software
in question—as well as survey responses from vendors. ER 58, 75. Thus,
far from using technical testing or other objective measures, Gartner relies
upon the reception and perception of products in the market, which, of
course, Gartner must exercise considerable judgment in evaluating.
Fourth, the 2008 and 2009 Magic Quadrant Reports inform readers
that “[p]lacement on the Magic Quadrant each year is based on Gartner‟s
view of the vendor‟s performance against the criteria listed.” ER 58, 75
(emphasis added). Thus, to the extent that any reader might think that the
31
complex, judgment-laden process described in the Reports produces
assertions of actual facts, the Reports make it plain that the placement of
vendors reflects Gartner‟s opinions or “views.”
As Plaintiff acknowledges, Opening Br. 15, the First Amendment bars
challenges to opinions unless those opinions can be reasonably read to assert
facts that are provably false. See, e.g., Partington, 56 F.3d at 1153. But
Plaintiff does not even begin to suggest how, in light of the process
described in the Reports and the express statements that the placement of
vendors is based upon Gartner‟s views, a reasonable reader could understand
that placement to assert actual facts. Instead, Plaintiff asserts that the Magic
Quadrant Reports assert facts because they are presented as “fact-based
mathematical reviews of product performance.” Opening Br. 29. That is
plainly wrong. The Reports do not review product performance. Indeed,
they do not even review products: instead, they evaluate vendors on an
overall basis. A vendor‟s product is considered in evaluating vendors, but it
is only one of many criteria and it is assessed based upon customer opinions
rather than product testing or other quantitative evidence.
It makes no difference that Gartner uses mathematical models. That a
mathematical model is used says nothing about the output of the model.
Many college football rankings are based upon mathematical models, but no
32
one suggests that the rankings that they produce are facts that may be proved
true or false. Accordingly, courts have recognized that evaluations derived
from similar mathematical models assert opinions. See Aviation Charter,
416 F.3d at 871 (holding safety rating produced by mathematical model to
be an opinion); Browne, 525 F. Supp.2d at 1252 (attorney ratings produced
by mathematical model held to be opinion).
Plaintiff also points out that companies pay Gartner substantial
amounts for its Reports and use them in making significant purchasing
decisions. Opening Br. 26-27. There is no question that the Reports are
important to Gartner‟s business and to the companies that purchase them. It
does not follow, however, that those companies purchasing the Reports
expect Gartner to perform product testing. As Gartner‟s warnings that
companies should carefully test certain products demonstrate, ER 68,
Gartner‟s readers are more than capable of testing the performance of e-mail
archiving products themselves. Moreover, any company that is able and
willing to purchase the Magic Quadrant Reports presumably is sophisticated
enough to understand the plain language of the Reports and knows that the
Reports provide something that performance testing cannot: namely,
Gartner‟s informed assessment of vendors, including their long-term
33
prospects—a crucial consideration in purchasing decisions that Plaintiff
acknowledges entail multi-year commitments. Opening Br. 27.
Accordingly, Plaintiff‟s relative placement in Magic Quadrant
diagram cannot reasonably be interpreted to assert actual facts rather than
opinions and is not actionable for that reason.
3. Plaintiff’s Placement In The Magic Quadrant

Diagram Is Not Sufficiently Factual To Be Proved
True Or False Because It Is Based Upon Abstract
Qualities Which Are Evaluated Based Upon
Qualitative Criteria Using Customer Opinions And
Other Qualitative Evidence.
Plaintiff‟s placement in the Magic Quadrant is not actionable for
another reason: it runs afoul of the “foremost” protection afforded
opinions—the requirement that a statement “must be provable as false
before there can be liability under state defamation law” in order to be
actionable Milkovich, 497 U.S. at 19; accord Underwager, 69 F.3d at 367;
Standing Comm. on Discipline v. Yagman, 55 F.3d 1430, 1441 (9th Cir.
1995).
Certainly, it cannot be proved that the placement of a vendor in the
Magic Quadrant diagram is true or false. As just noted, this process involves
the evaluation of abstract qualities according to qualitative criteria using
customer interviews and other qualitative information. This process
involves critical judgments concerning the credibility of witnesses, the
34
probative value of the opinions they express, the quantification of that
evidence in order to assess the various criteria, and the weighing of those
criteria to evaluate a vendor‟s Ability to Execute and Completeness of
Vision. As the district court recognized, this weighing is based upon a
“purely subjective determination that cannot be proved true or false.” ER
105 n.5; see also Aviation Charter, 416 F.3d at 871 (holding that a
“subjective interpretation of multiple objective data points leading to a
subjective conclusion” is not objectively verifiable).
Plaintiff does not—and cannot—suggest any alternative objective way
to prove whether Plaintiff is a better e-mail archiving vendor than Symantec.
As Plaintiff candidly admitted in its initial complaint, ER 6, its claims
against Gartner are premised on its belief that the primary, if not the only,
consideration in ranking vendors should be the performance of the vendor‟s
software. Plaintiff is entitled to that opinion, but Gartner is free to disagree,
and it expressly has in the Reports. Because e-mail archiving is a relatively
new market and the products are rapidly changing and evolving, Gartner
evaluates vendors on other criteria as well. In Gartner‟s view, a leading
vendor needs Completeness of Vision, that is, an ability to anticipate “future
product direction and demonstrate innovation in meeting customer needs.”
ER 46. In addition, because companies purchasing e-mail archiving
35
software make long-term commitments and therefore want vendors that can
anticipate and respond to changing needs, Gartner believes that a vendor‟s
long-term prospects are important and therefore evaluates financial strength
as well as sales and marketing capabilities. Id.
Disagreements over what criteria should be used to evaluate vendors
cannot, and should not, be resolved in court. There is no reliable,
constitutionally acceptable way for a judge or jury to determine whether e-
mail archiving software should be judged based upon its reception in the
market or by objective performance measures; whether a vendor‟s sales and
marketing abilities, financial strength, and other attributes should be
considered; and what relative weights these factors should be given. As
Plaintiff recognized in its initial complaint, “[t]here is no mathematical
discipline or process disclosed which can compute to a definitive point”
where a particular vendor should be placed in the Magic Quadrant, and
therefore “the process must necessarily degrade into a subjective
assessment.” ER 27. Moreover, if subjective assessments such as these
were submitted to a jury, there is a danger that the jury would decide to
impose liability based upon improper grounds such as whether it agrees with
the assessment or likes the defendant, thereby creating a risk of the very sort
36
of arbitrary judgment and accompanying chilling effect that the First
Amendment is supposed to prevent. See, e.g., Partington, 56 F.3d at 1159.
In the context here—where a publication evaluates multiple vendors
for customers contemplating substantial purchases—the chilling effect of
subjecting opinions to suit would be especially great. If Plaintiff could state
a valid defamation claim based upon its placement in the Magic Quadrant
diagram, other vendors that disagree with their placement could do so as
well. And if Gartner‟s Reports have as much influence on procurement
decisions as Plaintiff asserts, other vendors not categorized as Leaders or
otherwise believe that their “dot” was not placed in the correct place in the
diagram would have a strong incentive to sue to have the evaluation process
altered to favor them. It requires little imagination to foresee that Gartner
could be subject to conflicting damage awards and judgments requiring it to
alter its evaluation process in contradictory ways, which eventually might
deter Gartner from publishing at all.
C. Courts Consistently Have Held That Evaluations Analogous

To Those In The Magic Quadrant Reports Express
Protected Opinions.
Recognizing that “[r]atings and reviews are, by their very nature,
subjective and debatable,” Browne v. Avvo, 525 F.Supp.2d at 1252 n.1,
courts consistently have held that evaluations of parties analogous to those in
37
the Magic Quadrant Reports assert non-actionable opinions. See
Compuware Corp. v. Moody’s Investors Servs., Inc., 499 F.3d 520, 529 (6th
Cir. 2007) (holding corporate credit rating “dependent on a subjective and
discretionary weighing of complex factors” was not provably true or false);
Aviation Charter, 416 F.3d at 871 (holding “subjective interpretation of
multiple objective data points leading to a subjective conclusion about
aviation safety” nonactionable); Jefferson County Sch. Dist. No. R-1, 175
F.3d at 855 (holding statement concerning the creditworthiness of a bond
issuer was not actionable because the statement “could well depend on a
myriad of factors, many of them not provably true or false”); Browne v.
Avvo, 525 F. Supp. at 1251-54 (holding ratings of lawyers were not provably
true or false because “the conversion of the available information into a
number involves judgment, interpretation and assessment”); Bergen v.
Martindale-Hubbell, Inc., 337 S.E.2d 770, 771-72 (Ga. Ct. App. 1985)
(holding ratings of lawyers “not capable of proof of disproof”).
For example, in Aviation Charter, Inc. v. Aviation Research
Group/US, 416 F.3d 864, an airline charter company sued ARGUS for
giving the company a poor safety rating. ARGUS based its ratings on data
that it compiled from its “research into multiple public databases to uncover
accidents, incidents, enforcement actions, and certification data.” Id. at 866.
38
ARGUS assigned scores to this data, summed up the scores for individual
charter services, and then compared the various services before categorizing
them. Id. at 871. The Eighth Circuit recognized that this process “relie[d] in
part on objectively verifiable data.” Id. at 870. Nevertheless, it held that the
ratings could not be proved true or false because ARGUS made “subjective
assessment[s]” in determining “which underlying data to prioritize,
performed a subjective review of those data, and defined „safety‟ relative to
its own methodology.” Id at 871. It reasoned that such a “subjective
interpretation of multiple objective data points leading to a subjective
conclusion about aviation safety” was not sufficiently factual to be proved
true or false and therefore was a protected opinion. Id.
This reasoning applies to Gartner and the placement of Plaintiff on the
Magic Quadrant diagram with even greater force. Like ARGUS‟s safety
ratings, Gartner‟s vendor rankings are the product of a subjective
interpretation of multiple data points leading to a subjective conclusion. In
addition, like ARGUS, Gartner makes subjective assessments in determining
what data to prioritize, how to review them, and what categories and
concepts to use in drawing conclusions from that review. Indeed, because
the interviews and surveys upon which Gartner relies are even more
subjective than the government reports examined by ARGUS, they
39
presumably require more value-laden, critical judgments. In addition, unlike
ARGUS, Gartner does not consider a single criterion such as safety; instead,
it considers multiple criteria, many of which are far more subjective than
safety, uses them to assess two abstract qualities, Ability to Execute and
Completeness of Vision, and then places vendors onto a diagram. This
process is more complex and requires more judgment than ARGUS‟s
ratings, which make it even less provably true or false.
Thus, precedent supports the conclusion that Gartner‟s evaluation of
vendors and placement of them in the Magic Quadrant diagram expresses an
opinion that is protected from suit.
II. THE MAGIC QUADRANT REPORTS CANNOT

REASONABLY BE INTERPRETED EITHER TO ASSERT OR
TO IMPLY THAT SYMANTEC’S PRODUCTS ARE
SUPERIOR TO PLAINTIFF’S PRODUCTS IN TERMS OF
OBJECTIVE PERFORMANCE MEASURES.
Plaintiff announces in the opening paragraph of its opening brief that
the Magic Quadrant Reports tell readers that the “products sold by Appellant
ZL Technologies, Inc. lag far behind its competitors‟ products in terms of
objective performance,” Opening Br. 1, and argues that the Reports are
actionable because its superiority in terms of speed, accuracy, functionality,
cost, and other measures may be proved true or false, id. at 1, 16-18, 22, 30.
This argument fails as a matter of law for three separate reasons. First, the
40
Reports cannot reasonably be read to state that Plaintiff‟s products are
inferior to Symantec‟s products. Second, the Reports cannot reasonably be
read to imply that Plaintiff‟s products are inferior in terms of objective
performance for the simple reason that the Reports state that Gartner
evaluates vendors based upon customer opinions and other qualitative
information, not product testing or other objective information that could be
used to determine objective performance. Third, Plaintiff has failed to allege
that Gartner intended or was aware of the implications now being asserted
by Plaintiff.
A. The Magic Quadrant Reports Cannot Reasonably Be

Interpreted Either To Assert Or To Imply That Symantec’s
Products Are Superior To Plaintiff’s Products.
In the proceedings below, Plaintiff argued that the Reports were
actionable because Gartner had stated that Niche Players that serve a broad
market such as Plaintiff do not outinnovate or outperform other vendors. ER
155. The district court rejected this argument because the asserted statement
“cannot be found anywhere in the [Magic Quadrant] Reports.” ER 155.
Plaintiff‟s assertion before this Court—that the Magic Quadrant Reports
state that Symantec‟s products are superior to Plaintiff‟s—similarly has no
basis in the Reports, which were judicially noticed without objection and
41
therefore are properly considered on a motion to dismiss. See, e.g., In Re
Silicon Graphics Ins. Sec. Litig., 183 F.3d 970, 986 (9th Cir. 1999).
1. The Magic Quadrant Reports Plainly Do Not Assert

That Symantec’s Products Are Superior To Plaintiff’s
Products.
Plaintiff repeatedly asserts that the Magic Quadrant Reports state that
Symantec‟s products are not only superior but “far” and “vastly” superior to
Plaintiff‟s products, Opening Br. 1, 7, 13-14, 16, 30, but it fails to identify
where the Reports do so. Indeed, only one of Plaintiff‟s assertions even
references the Reports, and that reference is to the Magic Quadrant diagram.
Id. at 7 (citing ER 43, 58, 75). The diagram, however, plainly does not
assert that Plaintiff‟s product is inferior to Symantec‟s: as pointed out above,
Gartner places vendors, not their products, into the diagram, ER 43, 58, 75,
and they are placed based on its overall evaluation of their Ability to
Execute and Completeness of Vision, ER 45-48, 61-64, 77-80.
Plaintiff asserts that Ability to Execute “measures product
performance.” Opening Br. at 7. The Reports, on their face, show the
opposite. Product/Service is one of seven criteria used to evaluate the
Ability to Execute, and it is only one of three given a “high” weighting. ER
45-46, 61-62, 77-78. Moreover, the 2009 Report specifically states that the
42
Magic Quadrant‟s vendor rankings are not based solely upon product quality
or capabilities alone:
It is important to remember that the Magic Quadrant does not

just rate product quality or capabilities. While the product is an
important part of the rating, the vendor‟s ability to capture
customers and expand its presence in the market and to grow
the product and service revenue is also important. A vendor
that builds a strong product but is unable or unwilling to also
invest in marketing and sales to capture a growing base of
customers will find itself unable to invest in future
development.
ER 75.
Plaintiff also argues that the Magic Quadrant diagram considered in
isolation states that its products are inferior. See Opening Br. 22-23; see
also id. at 17 (“To underscore the factual nature of the Reports, one need
only to review the Magic Quadrants themselves.”). But the Magic Quadrant
diagram says nothing at all about products on its face: as noted above, the
diagram concerns vendors, not products, and it maps them according to their
Ability to Execute and Completeness of Vision, not products.
Nor does Kaelin v. Globe Communications Corp., 162 F.3d 1036 (9th
Cir. 1998), help Plaintiff. In that case, Brian “Kato” Kaelin, the erstwhile
houseguest of O.J. Simpson, sued the National Enquirer for defamation
based upon a front page headline stating “COPS THINK KATO DID IT!”
Id. at 1038. Although the text of the article accurately explained that the
43
police were considering perjury charges, Kaelin contended that the headline
falsely suggested that he was a suspect in the murders of Nicole Brown
Simpson and Ronald Goldman. Id. This Court held that Kaelin had stated a
valid claim because of the “peculiar nature of front page headlines” and the
fact that the article was “located 17 pages away from the cover.” Id. at
1041; see also Condit v. Nat’l Enquirer, Inc., 248 F. Supp. 2d 945, 966
(E.D. Cal. 2002) (considering front page headline 32 pages away from
article). In so doing, however, the Court recognized that generally “a
defamatory meaning must be found, if at all, in a reading of the publication
as a whole.” Kaelin, 162 F.3d at 1040; see also Knievel v. ESPN, 393 F.3d
at 1076 (“[W]e must take into account „all parts of the communication that
are ordinarily heard or read with it.‟”) (quoting Restatement (Second) of
Torts § 563, cmt. d (1977)); Partington, 56 F.3d at 1153 (“[W]e examine the
work as a whole.”).
This case is easily distinguishable. Unlike the National Enquirer,
Gartner‟s Magic Quadrant Reports do not have cover headlines and are
hardly displayed in supermarkets, pharmacies, and convenience stores. The
Magic Quadrant diagram does not appear on the cover of the Reports. And,
as noted above, unlike shoppers in checkout lines, the Reports‟ readers are
sophisticated purchasers of enterprise-level software who pay considerable
44
sums for the Reports, and there is no allegation that these readers look only
at the Magic Quadrant diagram. Consequently, it must be assumed that
readers read the Reports in their entirety and therefore understood that the
Reports did not find Plaintiff‟s products inferior to Symantec‟s.
2. Plaintiff’s Relative Placement In The Magic

Quadrant Diagram Cannot Reasonably Be
Interpreted To Imply That Symantec’s Products Are
Superior To Plaintiff’s Products.
In addition to asserting that the Magic Quadrant Reports expressly
state that its products are inferior, Plaintiff argues that a reasonable reader
could infer such inferiority from the relative placement of Plaintiff and
Symantec in the Magic Quadrant diagram. Opening Br. 17, 23. According
to Plaintiff, “[b]ecause the Magic Quadrant places Symantec‟s software so
far ahead of ZL‟s and other vendors‟ software, it is difficult to escape the
conclusion that Symantec outperforms other software in every conceivable
performance category.” Id. at 23. But, as just noted, the Magic Quadrant
diagram does not rate products; it evaluates vendors on an overall basis in
terms of their Ability to Execute and Completeness of Vision, ER 43, 58, 75,
and a vendor‟s Product/Service is only one of seven factor used in
evaluating the Ability to Execute, ER 45-46, 61-62, 77-78. As a
consequence, it cannot be inferred from Plaintiff‟s placement in the Magic
Quadrant diagram that Gartner found its products inferior. The process for
45
placing vendors onto the diagram is too complex to imply any “specific and
measurable claim, capable of being proved false or of being reasonably
interpreted as a statement of objective fact.” Coastal Abstract Serv., Inc. v.
First American Title Ins. Co., 173 F.3d 725, 731 (9th Cir. 1999).
Plaintiff also asserts that readers understand the Magic Quadrant
Reports to be based upon product performance because they buy the Reports
“to determine which e-mail archiving software will perform best for their
business.” Opening Br. 31; see also id. at 6 (stating that readers “want to
know[] which e-mail archiving product is best”). But such an understanding
is implausible because it assumes that Gartner and its readers are acting
irrationally. See Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009) (holding
that claims must have “facial plausibility” to survive a motion to dismiss and
therefore must be supported by factual content that allow a “reasonable
inference” of liability). Although the Reports include warnings and cautions
about products, as just shown, they do not determine which software
performs best. It is implausible that the IT professionals and procurement
officers who purchase Gartner Reports for thousands of dollars, ER 117-18,
do so even though the reports fail to address the issues that concern them.
And it is equally implausible that Gartner, which Plaintiff alleges to be the
dominant technology research and advising firm, ER 117, would fail to
46
provide its customers with the information in which they are most interested.
The only reasonable inference is that companies purchase Reports from
Gartner because they want to know what the Reports actually say about
things such as the vendor‟s reception in the market, its perceived
innovativeness and responsiveness, financial strength, and long-term
prospects.
The implication of inferiority that Plaintiff would draw from the
Reports is unreasonable for another reason as well. As the district court
recognized, the Reports commented favorably concerning those products.
For example, the 2008 Report stated that Plaintiff‟s references “spoke of the
solution‟s ease of deployment, strong performance, and comprehensive
supervision and discovery modules.” ER 63. Similarly, the 2009 Report
noted that Plaintiff‟s customers “are happy with product features, scalability,
and efficient use of infrastructure.” ER 89. By contrast, those same Reports
cautioned readers that the inability of certain of Symantec‟s products to “do
[a] search within a search . . . may be problematic” and that one product
should be “carefully reviewed to see that it meets organization requirements
as delivered.” ER 68. These statements belie any suggestion that the
Reports imply that Plaintiff‟s products are inferior to Symantec‟s.
47
B. The Magic Quadrant Reports Cannot Reasonably Be

Interpreted To Assert That Plaintiff’s Products Are Inferior
In Terms Of Objective Performance Because The Reports
Plainly State That Vendors Are Evaluated Based Upon
Consumer Opinions And Other Qualitative Information
Rather Than Product Testing Or Other Analysis Of
Objective Performance.
Even if the Magic Quadrant Reports somehow could be interpreted to
state or imply that Symantec‟s products are better than Plaintiff‟s, Plaintiff‟s
defamation and trade libel claims still would be barred because whether one
product is better than another product is generally a matter of opinion, which
is not sufficiently factual to be proved true or false and therefore not
actionable. See, e.g., Pizza Hut, Inc. v. Papa John’s Int’l, Inc., 227 F.3d
489, 498 (5th Cir. 2000) (holding claim that chain made “better pizza” was a
statement of opinion because it was not susceptible of being proved true or
false). Plaintiff tries to avoid this problem by asserting that the Reports state
that Symantec‟s products are superior “in terms of objective performance”
measures, Opening Br. 1, such as search speed, scalability, search accuracy,
completeness of search, and cost, which may be proved true or false.
Opening Br. 1, 8-9, 30-31. But the Reports cannot reasonably be interpreted
to assert or imply anything about objective performance.
As the district court found, the Reports “nowhere suggest[] that ZL‟s
products do not possess” the objective performance characteristics asserted
48
by Plaintiff. ER 159 n.3. The Magic Quadrant Reports do not review
product features and performance. Nor do they report or suggest
benchmarked testing or any other analysis of objective performance.
Performance, to the extent that it is addressed at all, is instead evaluated in a
highly subjective fashion based upon interviews with Gartner customers and
vendor-supplied references. ER 58, 75.
In asserting that Gartner evaluated products in terms of objective
performance measures, Plaintiff relies upon the “What You Need to Know”
section of the Reports. Opening Br. 5, 16-17 (citing ER 42, 57, 74). This
section, however, provides Plaintiff no support.
For example, Plaintiff contend that the What You Need to Know
section states that products are ranked by focusing upon their “scalability”
and “functionality.” Opening Br. 5. Not so. The section states that the
Reports are focused on enterprise-class products, but that organizations with
limited requirements or small numbers of users “may want to start with one
of these products, knowing that they will eventually need the scalability and
functionality they provide.” ER 42, 57, 74 (emphasis added).
Plaintiff also asserts that Gartner considered the following factors in
evaluating products: “code quality,” “stable code,” “code problems,” “time
to create . . . indexes,” “time to search them,” “time . . . to accomplish the
49
archiving” and “full capture of messages.” Opening Br. 5 (citing ER 42).
Also, not so. The What You Need to Know section notes that “[m]ost
vendors” have two of these factors, “stable code” and “full capture of all
messages,” ER 42, and it mentions the remaining five factors in discussing
general “areas of concern” with current e-mail archiving products, id. There
is, however, no suggestion that these factors are used in ranking products.
Indeed, Plaintiff appears to have plucked the quoted phrases out with
no concern for how the Report actually uses them:
As the vendors covered in this year‟s Magic Quadrant have

gained more customers, they have strengthened their
understanding of market requirements and have responded with
new features and a more robust implementation of existing
features. Most vendors have [2] stable code for basic features
to allow for [7] full capture of all messages and for mailbox
management. They are looking to differentiate themselves with
better discovery, administrative tools and expanded device
support. Several are providing links to other content archiving
or records management solutions. A few vendors still focus on
the unique compliance supervision requirements of the financial
community, but that market is relatively small compared to the
market for support for legal discovery support and mailbox
management. The December 2006 changes to the Federal
Rules of Civil Procedure (see “Organizations and In-House
Counsel Must Prepare to Comply With New E-Discovery
Rules”) is motivating more companies to move more quickly
from the evaluation stage to implementation mode.
Although many vendors have made significant improvements to

their products, there are still many areas of concern, not the
least of which is the complexity of deploying and managing
growing archives. Clients continue to ask for better archive
management and monitoring tools, even though vendors have
50
made progress in this area this past year. Migrating personal

stores into the archive continues to be a pain point in the quality
of the available tools and in the [6] time it takes to accomplish
the archiving. As the archives grow, the indexes generated for
the content also grow. The [4] time to create those indexes for
clients receiving large volumes of messages on a daily basis,
plus the [5] time to search them, continues to be a key concern.
[1] Code quality for new features continues to be a concern with
early adopters of such features often serving as quality
assurance departments for their vendors. Improved support was
a focus for most vendors this year with marked improvement
noted by customers. Training of partners and local installation
support staff is still a weak area, but low scores for support
were most often tied to [3] code problems.
ER 42, 57, 74 (emphasis and numbering added).
Plaintiff contends that the objective performance measures listed by it
“are most important to the enterprise software consumer,” Opening Br. 8;
see also id. at 22 (asserting that “product speed, accuracy, stability, features,
scalability, and cost” are the “specific attributes that are of interest to the
reader”), and that readers of the Magic Quadrant Reports would conclude
that the rankings in the Reports are “based upon their understanding
regarding what makes one product better than others (i.e., speed, accuracy,
scalability, cost, etc.),” id. at 18. As shown above, this is not a reasonable
interpretation of the Reports because it assumes that Gartner produces, and
its customers purchase, reports that fail to address the issues that matter the
most to the customers. See supra pp. 46-47.
51
Indeed, by asserting that the Magic Quadrant Reports say that its
products are inferior in terms of objective performance—when Gartner
actually evaluates vendors and assesses performance based upon customer
opinion rather than any testing or other performance measures—Plaintiff is
seeking to ignore the statements actually made by Gartner and the
constitutional protections attached to them. Plaintiff should not be permitted
to make such an end run around the First Amendment. When a defamation
claim is based upon a publication, that publication is implicitly incorporated
into the pleadings, and the claim must be judged based upon what the
publication actually says. See, e.g., Knievel, 393 F.3d at 1076; see also
Steckman v. Hart Brewing, Inc., 143 F.3d 1293, 1295-96 (9th Cir. 1998)
(“[W]e are not required to accept as true conclusory allegations which are
contradicted by documents referred to in the complaint.”).
C. Plaintiff Has Not Alleged That Gartner Intended Or Was

Aware Of The Implication That Plaintiff’s Products Are
Inferior In Terms Of Objective Performance.
Plaintiff‟s argument on appeal suffers from another fatal defect: it has
failed to plead intent or knowledge supporting the implication it asserts.
Where an opinion or other statement allegedly implies defamatory facts, the
party alleging defamation must prove that “the defendant intended or knew
of the implications that the plaintiff is attempting to draw.” Compuware
52
Corp., 499 F.3d at 528 (quotation omitted). See generally Milkovich, 497
U.S. at 20-21. Plaintiff has failed to allege such intention or knowledge: it
simply asserts that the allegedly defamatory statements in the Magic
Quadrant Reports were “made with actual malice” and “with knowledge of
falsity or with reckless disregard for the truth.” ER 133-34. Such
conclusory assertions do not state a claim. See, e.g., Iqbal, 129 S. Ct. at
1949 (“A pleading that offers . . . a formulaic recitation of the elements of a
cause of action will not do”) (quotation omitted).
D. Because The Magic Quadrant Reports Are Not Reasonably

Susceptible To The Interpretation Advanced By Plaintiff,
Plaintiff’s Arguments Concerning Disclaimer And Other
Issues Are Inapposite.
1. According to Plaintiff, this appeal raises the question whether
Gartner can escape liability for statements that the Reports are “reliable,
fact-based and grounded in rigorous analysis” based on what Plaintiff
describes as “fine-print, boilerplate disclaimers” stating that the Reports
contain “nothing more than unreliable conjecture.” Opening Br. 2-3. In
fact, neither Gartner nor the district court ever has suggested that the Reports
contain unreliable conjecture. The Reports are grounded in rigorous and
reliable analysis, but Gartner‟s conclusions about vendors and their
placement in the Magic Quadrant diagram nonetheless express protected
opinions. As shown above, a statement is not unreliable or ungrounded in
53
rigorous analysis simply because it expresses an opinion. See supra pp. 28-
29. In addition, it should be noted that the statement that the Reports contain
“opinions” appears prominently on the cover of the Reports in a font only
slightly smaller than the rest of the Reports, ER 41, 56, 73, and the statement
that the Magic Quadrant diagram is based upon Gartner‟s “view” is in the
text of the Reports, ER 58, 75.
Plaintiff points out that disclaimers cannot transform an assertion of
fact into an opinion. Opening Br. 28-29. That is true, but immaterial here.
As shown above, Gartner‟s placement of vendors in the Magic Quadrant
does not assert facts: it expresses Gartner‟s opinions concerning the overall
suitability of vendors. See supra pp. 45-46. By contrast, in the authority
cited by Plaintiff, statements of fact were “sprinkled” with disclaimers and
cautionary language. Overstock.com, Inc. v. Gradient Analytics, Inc., 61
Cal. Rptr. 3d 29, 41-42 (Ct. App. 2007).
2. Plaintiff argues that Gartner‟s failure to disclose the evidence
evaluated in making its rankings does not exempt it from liability. Opening
Br. 32-35. This is a straw man. When the facts underlying an opinion are
disclosed, and those facts are true, the opinion itself cannot imply additional,
unstated facts and therefore is nonactionable. See, e.g., Standing Comm. on
Discipline, 55 F.3d at 1439; Lewis, 710 F.2d at 555-56. It does not follow,
54
however, that whenever such facts are not disclosed assertions of objective
facts can be implied. The failure to disclose underlying facts is a necessary
but not sufficient condition for rendering an opinion actionable.
Plaintiff‟s suggestion that Gartner‟s opinions be stripped of First
Amendment protection because the Reports do not state the facts underlying
them is inimical to the First Amendment. IT professionals and procurement
officers purchase the Reports precisely because they want Gartner‟s
conclusions without having to analyze the mountain of data that Gartner
analyzes (which, given the hundreds of interviews conducted by Gartner
probably would be impossible to disclose anyway). Numerous other
publications provide summary reviews and ratings so that readers do not
have to review the underlying data. Thus, a rule stripping opinions of First
Amendment protection unless the evidence underlying them is disclosed
would severely limit that protection and unnecessarily expose useful
publications to liability.
3. Plaintiff asserts that the district court “incorrectly relied upon
its own subjective reading of the Reports” rather than determining whether
the Reports reasonably can be construed to assert facts that may be proved
true or false. Opening Br. 14-16. As shown above, however, the Reports
cannot reasonably be read to assert that Symantec‟s products are superior to
55
Plaintiff‟s, much less superior in terms of objective performance. See supra
pp. 41-52. Moreover, as Plaintiff acknowledges, Opening Br. 15, whether a
statement is reasonably susceptible to being interpreted to assert facts is a
question of law. See Manufactured Home Communities, 544 F.3d at 964;
see also Knievel, 393 F.3d at 1073-74 (resolving this question “as a matter of
law”); Lewis v. Time, Inc., 710 F.2d 549, 553 (9th Cir. 1983) (“The question
whether a statement is one of fact or of opinion is one of law.”). As a
consequence, the district court properly held that Gartner‟s placement of
Plaintiff in the Magic Quadrant diagram expressed a protected opinion.
4. Noting that opinions may be actionable if they imply facts that
are provably true or false, Plaintiff cites a number of cases in which courts
have permitted defamation claims based upon unstated but implied facts.
Opening Br. 18-21; see also id. at 24 (noting that mixed expressions of fact
and opinion may be actionable). These cases are easily distinguished.
For example, Plaintiff notes that in Unelko Corp. v. Rooney, 912 F.2d
1049 (9th Cir. 1990), this Court held that a commentator‟s statement that a
product named Rain-X “didn‟t work” could be interpreted to imply that the
product “was not invisible, that rain did not disperse on contact, that Rain-X
did not repel bugs and other projectiles, that cleaning was not a snap, and
that Rain-X did not increase Rooney‟s all-around visibility, safety, and
56
driving comfort.” Id. at 1055. But Plaintiff fails to acknowledge the reason
why Unelko found that such facts might have been implied: the Rain-X
bottle claimed that it could do all of these things. See id. (noting that the
bottle‟s claim that Rain-X “[d]ramatically improves wet weather visibility”;
“[c]overs windshields . . . with an invisible shield” that “shrugs off bugs,
frost, salt, mud & grime”; “makes cleaning a snap”; and “increase[s] all-
around visibility, safety, & driving comfort”). Thus, as this Court later
observed, Unelko held that the statement in question was actionable because
it “implied a specific factual assertion.” Standing Comm. on Discipline, 55
F.3d at 1439 n.16.
No similarly specific assertion reasonably is implied by the Magic
Quadrant diagram. To the contrary, the complex process by which Gartner
places vendors onto the diagram precludes a reasonable reader from
inferring any specific facts from Plaintiff‟s placement. See supra pp. 29-34.
In other cases cited by Plaintiff, the context implied that the
statements were based upon specific facts. For example, in Mzamane v.
Winfrey, 693 F. Supp. 2d 442 (E.D. Pa. 2010), a court held that Oprah
Winfrey‟s statement that she had “lost confidence” in the headmistress of a
school founded by Winfrey was capable of a defamatory meaning because it
was made in conjunction with a statement “that „any person that has caused
57
harm‟ to the students would not be returning” to the school. Id. at 480-81.
In Condit v. National Enquirer, Inc., 248 F. Supp. 2d 945, a court held that a
cover headline announcing “COPS: CONDIT‟S WIFE ATTACKED
CHANDRA” could reasonably be interpreted to suggest a crime such as
murder, battery, or assault because it was published in the midst of a media
frenzy and ongoing investigation into the disappearance of Ms. Levy, an
intern to Congressman Gary Condit. Id. at 964-65. And in Gill v. Hughes,
278 Cal. Rptr. 306, 311 (Ct. App. 1991), a court held the statement that a
doctor was “an incompetent surgeon and needs more training” implied that
the doctor was not qualified to practice in part due to “[t]he fact that an
evidentiary hearing was held regarding the [doctor‟s] surgical technique.”
Id. at 1309. Nothing in the Reports or the context in which they were
published suggests such specific facts here.
Flamm v. American Association of University Women, 201 F.3d 144
(2d Cir. 2000), does not help Plaintiff either. In that case, a legal directory
referred to a lawyer as an “ambulance chaser,” and the lawyer sued for
defamation on the ground that the directory implied that he had engaged in
unethical solicitations. Id. at 146-47. Although the publisher argued that the
phrase could be understood as a mere epithet without any specific factual
content, the court held that a reasonable reader could interpret it to imply
58
unethical behavior because the directory “in all other respects states facts.”
Id. at 151. Here, by contrast, the Reports indicate that the statements in
them assert opinions by informing readers that they contain “opinions” and
are based upon the “views” of Gartner, and by describing the complex and
judgment-laden fashion in which those views are formulated. See supra
pp. 27-34.
5. Citing Unelko, Plaintiff also asserts that a speaker may be
exposed to liability under the implied facts doctrine “even when the
speaker‟s opinion is stated in vague or general terms.” Opening Br. 20. But
in Unelko the statements in question implied “a specific factual assurance.”
Standing Comm. on Discipline, 55 F.3d at 1439 n.16 (emphasis added).
Where, as here, there is nothing suggesting specific facts, and a statement is
merely “vague and subjective,” it is not actionable as a matter of law.
Coastal Abstract Servs., 173 F.3d at 731; see also Lewis, 710 F.2d at 554
(9th Cir. 1983) (holding that a “broad, unfocused, wholly subjective
comment” is “not the kind of factual expression for which the Constitution
permits liability to be imposed”). The district court correctly held that the
portions of the Reports challenged by Plaintiff assert opinions and therefore
are protected from suit.
59
III. DEFENDANTS DID NOT DEFAME PLAINTIFF BY

EQUATING ITS PRODUCTS WITH THE PRODUCTS OF THE
VENDOR THEY IDENTIFIED AS THE INDUSTRY LEADER.
Plaintiff also asserts a claim against both Gartner and Defendant
DiCenzo, Gartner‟s lead analyst on the e-mail archiving market. Plaintiff
alleges that DiCenzo and other Gartner employees defamed it by telling
potential customers that Plaintiff‟s products are “the same” as one of
Symantec‟s products. Opening Br. 31 n.3. The district court rejected this
claim because the alleged statement was too vague to be proved true or false
and because, coming from employees of a company that repeatedly has
designated Symantec as the leader in the e-mail archiving market, this
statement was far from defamatory. ER 106, 150-51 n.2. Plaintiff has no
persuasive response to this ruling.
Plaintiff asserts that Defendants‟ statement was provably false
because readers understood the statement to mean that Plaintiff‟s and
Symantec‟s products “performed identically in terms of their features and
objective performance.” Opening Br. 31 n.3. But, as the district court
recognized, the statement also could have been referring to other things such
as user-friendliness or compatibility with hardware. ER 150. Plaintiff fails
to offer any support for its assertion that the statement would be understood
60
as referring to features or objective performance beyond a wholly
conclusory, and thus legally inadequate, allegation in its pleadings. ER 131.
In any event, Plaintiff fails to address the District Court‟s ruling that
Defendants‟ statement was not defamatory, which provided an independent
ground for rejecting this defamation claim. By not specifically and
distinctly raising an argument concerning this ruling, Plaintiff has waived
any objection to that ruling, thereby mooting its arguments concerning the
district court‟s alternative ruling. See, e.g., Indep. Towers of Wash. v. State
of Wash., 350 F.3d 925, 929 (9th Cir. 2003) (noting that the court reviews
“only issues which are argued specifically and distinctly in a party‟s opening
brief”) (quotation omitted).2
2
Plaintiff also has waived its claim that it was defamed by the
Reports‟ suggestion that it serves only a limited market, Opening Br. 31,
because it did not raise the claim in the district court. See, e.g., Canada Life
Assurance Co. v. LaPeter, 563 F.3d 837, 846 (9th Cir. 2009).
61
CONCLUSION
The judgment below should be affirmed.
DATED: September 28, 2010 Respectfully submitted,
/s/ Daniel H. Bromberg______

Robert P. Feldman
Daniel H. Bromberg
QUINN EMANUEL URQUHART
& SULLIVAN, LLP
555 Twin Dolphin Drive
5th Floor
Redwood Shores, California 94065
Telephone: (650) 801-5000
Facsimile: (650) 801-5100
Attorneys for Defendants-Appellees

Gartner, Inc. and Carolyn DiCenzo
62
CERTIFICATE OF COMPLIANCE WITH FRAP 32(a)(7)(C)

AND CIRCUIT RULE 32-1
Pursuant to Fed. R. App. P. 32(a)(7)(C) and Circuit Rule 32-1, the attached
brief is proportionately spaced, has a typeface of 14 points or more, and contains
13,190 words, excluding parts of the brief exempted by Fed. R. App.
32(a)(7)(B)(iii), as counted by the Microsoft Word 2003 application.
DATED: September 28, 2010
/s/ Daniel H. Bromberg_________________
63
REQUEST FOR ORAL ARGUMENT

Defendants-Appellees Gartner, Inc. and Carolyn DiCenzo respectfully
request that this Court entertain oral argument.
64
STATEMENT OF RELATED CASES

Pursuant to Circuit Rule 28-2.6, Defendants-Appellees Gartner, Inc. and
Carolyn DiCenzo state that they are unaware of any related pending cases.
65
CERTIFICATE OF SERVICE
I, Robert P. Feldman, a member of the Bar of this Court, hereby certify that
on September 28, 2010, I electronically filed the foregoing “Answering Brief Of
Defendants-Appellees” with the Clerk of the Court of the United States Court of
Appeals for the Ninth Circuit by using the appellate CM/ECF system.
I certify that all participants in this case are registered CM/ECF users and
that service will be accomplished by the appellate CM/ECF system.
/s/ Robert P. Feldman______________
66

ZL V Gartner Appellee's Brief

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ZL V Gartner Appellee's Brief

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Case: 10-16061 09/28/2010 Page: 1 of 76 ID: 7490389 DktEntry: 15

FOR THE NINTH CIRCUIT

GARTNER GROUP, INC. AND CAROLYN DICENZO,

On Appeal from the United States District Court

ANSWERING BRIEF OF DEFENDANTS-APPELLEES

September 28, 2010

CORPORATE DISCLOSURE STATEMENT

Defendants-Appellees Gartner, Inc., which is incorrectly identified in the caption

corporation owns more than 10% of Gartner, Inc.

CORPORATE DISCLOSURE STATEMENT ............................................... i

TABLE OF AUTHORITIES ......................................................................... vi

STATEMENT OF FACTS AND OF THE CASE ..........................................5

B. The Magic Quadrant Reports ......................................................7

1. Plaintiff‟s Original Complaint ....................................... 12

2. The First Dismissal Order .............................................. 13

SUMMARY OF ARGUMENT .................................................................... 17

I. AS THE DISTRICT COURT CORRECTLY RECOGNIZED,

A. The First Amendment And California Law Protect

B. Plaintiff‟s Relative Placement In The Magic Quadrant

1. The General Tenor Of The Magic Quadrant

2. The Magic Quadrant Reports Also Plainly Inform

3. Plaintiff‟s Placement In The Magic Quadrant

II. THE MAGIC QUADRANT REPORTS CANNOT

A. The Magic Quadrant Reports Cannot Reasonably Be

1. The Magic Quadrant Reports Plainly Do Not

B. The Magic Quadrant Reports Cannot Reasonably Be

D. Because The Magic Quadrant Reports Are Not

REQUEST FOR ORAL ARGUMENT ........................................................ 64

STATEMENT OF RELATED CASES ........................................................ 65

Aviation Charter, Inc. v. Aviation Research Group/US,

Bergen v. Martindale-Hubbell, Inc.,

Blatty v. New York Times Co.,

Bose Corp. v. Consumers Union of United States, Inc.,

Browne v. Avvo, Inc.,

Canada Life Assurance Co. v. LaPeter,

Compuware Corp. v. Moody’s Investors Servs., Inc.,

Condit v. Nat’l Enquirer, Inc.,

Flamm v. Am. Ass’n of Univ. Women,

Franklin v. Dynamic Details, Inc.,

Gertz v. Robert Welch, Inc.,

Greenbelt Coop. Publ’g Ass’n, Inc. v. Bresler,

Hustler Magazine, Inc. v. Falwell,

Jensen v. Hewlett-Packard Co.,

Kaelin v. Globe Communications Corp.,

Letter Carriers v. Austin,

Lewis v. Time, Inc.,

Milkovich v. Lorain Journal Co.,

Philadelphia Newspapers, Inc. v. Hepps,

Pizza Hut, Inc. v. Papa John’s Int’l, Inc.,

In re Silicon Graphics Ins. Sec. Litig.,

Standing Comm. on Discipline v. Yagman,

Steckman v. Hart Brewing, Inc.,

Underwager v. Channel 9 Australia,

28 U.S.C. § 1332 ..............................................................................................4

publishes reports about the information technology industry for a

sophisticated audience of technology professionals. One of the reports

annually published by Gartner evaluates vendors for enterprise-class, e-mail

archiving software. When large enterprises purchase e-mail archiving

software, they typically make multi-year commitments even though such

software is rapidly developing and changing. Accordingly, in evaluating

marketing, financial strength, and other factors shedding light on the

vendors‟ long-term prospects and ability to adapt to changing requirements.

Plaintiff ZL Technologies, Inc. is a small, self-funded vendor of e-