FROM Tod’s DESK
Speaking on behalf of our entire team, our relationship with you and your team is incredibly important to us.
NOVEMBER 12, 2018
MACOLA RESELLER GROUP FILES SUIT AGAINST ECi MACOLA/MAX for ANTITRUST AND OTHER VIOLATIONS
Suit says ECi is forcing unwanted services on clients and attempting to prevent competition
COLUMBUS, Ohio. Nov. 9, 2018 – Exceptional Software Solutions LLC, along with a group of Macola Channel Partners and resellers, recently filed a multi-count lawsuit against software developer ECi Macola/MAX, LLC, (“ECi”) alleging antitrust violations, tortious interference, breach of contract, and other claims.
On October 1st, 2018, resellers of Macola Software received a notification from ECi Software Solutions, Inc., the parent corporation of ECi Macola/MAX, that in the coming months it would be discontinuing its partner channel that had been running for more than 25 years. The notification also stated that customers would no longer be allowed to work with their reseller partners on ECi products in the future.
A copy of the complaint here and a copy of the motion for a temporary restraining order here.
Macola resellers have for many years provided sales, support, and consulting services for users of Macola, an enterprise resource planning software system used primarily by small- to mid-sized businesses in manufacturing. According to the lawsuit, ECi has decided to cut out its former reseller partners and prevent them from offering support and consulting services to businesses using Macola. By preventing competition, the lawsuit says, ECi will create a monopoly for itself in the markets for support and consulting of Macola. The complaint contends that ECi is already exercising monopoly power over Macola users, forcing them to purchase services they do not want in exchange for continuing to receive routine Macola software updates.
According to the lawsuit, ECi is attempting to prevent competition by fraudulently telling Macola users that they will breach their software license agreement with ECi if they continue to do business with their reseller. At the same time, the complaint alleges, ECi is pressuring Macola users to sign new software license agreements that contain restrictive language that would prohibit Macola users from hiring anyone other than ECi to perform support or consulting on Macola software. In addition, the lawsuit claims that ECi has committed or threatened multiple breaches of its contract with the resellers, including cutting off earned commissions and other benefits under the contract.
On November 7th, 2018, a seasoned group of Macola resellers with hundreds of combined years of service, represented by the law firm Organ Cole LLP, filed suit against ECi in the U.S. District Court for the Southern District of Ohio, alleging that ECi’s conduct constitutes breach of contract, tortious interference, unfair competition, and violates state and federal antitrust law.
"In 2017 our firm was awarded the triple crown of channel partner honors from Macola. Today we are the number one Macola Channel Partner in North America. ECi seems to have miscalculated the deep-rooted relationships, along with the knowledge the Macola Channel partner community has about how customer’s business operations really work. Our ability to support the community is vital to each Macola customer" said Tod Replogle, President, Exceptional Software Solutions LLC, one of the plaintiffs in the lawsuit
“It’s a daunting task for a handful of small businesses to take on ECi’s millions, but we made a promise to help our customers grow their businesses and we’ve become an integral partner with those companies,” said Michael Oswalt, CEO of Algorithm, Inc.
“We believe every customer is valuable,” agreed Jeff DeSchon, Vice President of iPro, another of the plaintiffs. “We will continue to serve them, and we will protect our employees and their families. That is why we’ve taken this action.”
Chuck Wise, President of another plaintiff in the lawsuit, Copious Solutions, added, “We believe that our customers should carefully review any new contract documents put in front of them by ECi, including click-through documents and sales order footnotes, and seek legal counsel where appropriate.”
Currently pending before the court is the Macola resellers’ request for a temporary restraining order. If that request is granted, the order would prevent ECi both from telling Macola customers that they are prohibited from doing future business with the resellers and from requiring customers to purchase unwanted services as a condition of receiving software updates.
By now you’re aware that ECi, the parent company of Macola Software, has made severe changes to how you will receive software support in 2019 and beyond. In short, ECi has terminated its channel community effective December 31, 2018. I understand that the news is sobering, abrupt and very upsetting.
HERE’S WHAT I NEED YOU TO KNOW.
We’re not going anywhere; Exceptional Software Solutions LLC is here now and for the long haul. Based on our deep-rooted relationship, along with the knowledge of how your business operates, we will guide you toward a go-forward strategy.
We will continue to support companion solutions. Regardless of the companion support solution(s) your ERP is running, our support for you is NOT affected by ECi’s announcement. Simply put, Exceptional Software Solutions LLC CAN and WILL continue to support your companion software needs from Avalara to WiSys and the many in between.
We will continue to support your custom integrations and solutions. Your custom solutions, integrations and products are NOT affected by ECi’s announcement. You won’t have to start over or rebuild integrations. The Exceptional Software Solutions LLC team WILL continue to support these custom solutions on which your team took our advice and trusted us to build on your behalf.
We offer alternative ERP solutions. Our team supports Exact Globe ERP and Exact Synergy. We are a global channel partner for Exact Solutions in North America and have some of the best and brightest experts on the planet in this solution. Candidly, many of our customers have inquired about alternatives to Macola Software. As a result, we’ve beefed up our capacity to deliver even more exceptional support and service in this alternative solution. Visit www.esoftsol.net/exact-overview for more information.
WE’RE HERE TO CREATE BUSINESS IMPACT, NOT SIMPLY SELL YOU SOFTWARE.
For nearly 25 years, the Exceptional Software Solutions LLC team has been helping SMBs across the spectrum grow. We’ve always taken the time to listen, learn and then advise. It’s how we’re able to offer advice and complex technical solutions that take into consideration economics, staffing, technology expansion and more for firms all across the U.S. and into Canada.
For these reasons and many more, it’s incredibly disheartening to learn that you are being offered a complimentary one-day on-site business process review. Your ERP implementation is complex. Your business cannot be learned in one day. The institutional knowledge that our teams together have developed over the years about your ERP implementation, customer demands and business imperatives simply can’t be replaced. I believe that ECi has miscalculated this critical piece of data in its decision-making criteria.
EXPERIENCE NEVER MATTERED MORE
You’ve got 330-plus years of ERP experience at your disposal with the Exceptional Software Solutions LLC team. We’re not going anywhere. We take our relationship with all of our customers personally. We’re not just your provider, we’ve become friends over the years and will continue to guide you as well as offer a knowledge transfer that is bar none. And we’ll continue to do so with our eyes fixated on your long-term success.
OTher FREQUENTLY ASKED QUESTIONS
Q. HOW DO YOU GET REAL-TIME UPDATES?
A. While ECI’s decision has really upset the applecart, we’re here to help you sort through the FACTS. Please visit http://bit.ly/ess-mailing-list to ensure your email address is in our database and flag my email address as “trusted” so communications aren’t directed to a spam folder.
Q. WHAT SHOULD YOU DO NEXT?
A. Please do not sign anything without seeking internal legal counsel and our advice.
Q. WHAT IS OUR TEAM DOING TO HELP YOU?
A. We’re proactively creating risk-mitigation plans for you and your team. We are actively in conversations with ECi to be in the position to offer you the facts regarding their decision to terminate the Macola Channel Partner Community.
Q. WHEN WILL YOU HAVE MORE INFORMATION?
A. Shortly, I’ll be announcing some very exciting news, which makes it even more imperative that you’re subscribed to our communications. Please watch your email for more.
I’ll be in touch soon,
October 3, 2018
Here’s what your team at Exceptional Software Solutions LLC would like you to know
I’m sure you have a boatload of questions and serious concerns.
Yes, ECi has decided to discontinue its North America Channel Partner Program effective midnight December 31, 2018.
Yes, we are made aware of the communication. As the #1 Macola Channel Partner in North America, Exceptional Software Solutions, LLC has a phenomenal relationship with Macola/ECi. We are working with the ECi team to discuss a go forward strategy that puts your firm’s ERP success as the top priority.
No, the announcement has no effect on Exact solutions. We are also a Global Exact Channel Partner. That means we are able to sell and support all Exact products which include Globe and Synergy.
Yes, Exceptional Software Solutions, LLC still has your back. We have a long, trusted relationship with you and your team. We will continue to be here for you.
I’ll be in touch with you within the coming days with more concrete information and next steps. In the meantime, rest assured nothing changes as far as our relationship with you and the support that we provide.If for any reason you get my out of office email or voicemail, just know that I’m on the line with a customer and will be right with you.
More real soon,