Dive Brief
- Communications provider Avaya filed suit Jan. 15 against long-time reseller partner C1 for “improperly interfering with Avaya’s customer relationships,” according to court documents.
- The case originally filed with the Supreme Court of the State of New York, County of New York, has since been moved to the U.S. District Court for the Southern District of New York. The companies remain in arbitration with the American Arbitration Association, according to court documents.
- “We can acknowledge that Avaya initiated legal proceedings against C1 in the NY courts and through arbitration, and is committed to pursuing this matter," an Avaya spokesperson told Channel Dive. "Our priority in this matter is the protection of our business and the interests of our customers. We will not be commenting further and do not intend to make additional public statements as this is an ongoing legal matter.” The company has retained law firm Quinn Emanuel Urquhart & Sullivan, LLP to represent it.
Dive Insight:
The dispute clouds a long-running relationship between the unified communications and collaboration provider and a partner it has relied on for sales and professional services.
“C1 has been Avaya’s partner of the year 17 times, and every year, it is one of the biggest,” ZK Research Principal Analyst Zeus Kerravala told UC Today. “It would be akin to Cisco suing World Wide Technology.”
Avaya persuaded the court to seal the evidence for its suit "out of respect for the parties' long-standing relationship," but counterfilings from C1 present a clear enough picture.
According to C1, Avaya has complained that C1 has improperly influenced Avaya customers. Avaya listed all of its customers of $75,000 in annual revenue or larger in arbitration, C1 wrote. The implication is that C1, a longtime strategic partner of Avaya, has aggressively marketed other vendors to Avaya customers in a way that violates its reseller agreement.
“It sounds like there were some aggressive campaigns promoting migrations to Genesys,” Joe Rittenhouse, Co-CEO of Avaya partner CTPros, told Channel Dive in an email. “It takes a lot to sue a partner. It's a horrible look for Avaya but they need help (desperately), and this is likely another miss calculation.”
A white paper on C1’s website outlining “six proven steps to migrate from Avaya to Genesys,” has been removed.
C1 has become a multi-time partner of the year with Genesys, whose cloud contact center solution has displaced on-prem Avaya products. And C1 is not the only value-added reseller that has added cloud-based challengers to its line card.
C1 and Genesys had not responded to Channel Dive as of publishing time.
The lawsuit reflects changing dynamics between vendors and partners. C1’s master reseller agreement with Avaya dates back to 2002 when on-premise communication hardware dominated the market. Value-added resellers and dealers aligned closely with the largest OEMs — notably Avaya and Mitel.
Decades later, cloud-based unified communications and contact center software vendors have migrated customers from Avaya and Mitel en masse, and partners like C1 have embraced the new generation of providers. The rise of the agency model, which has a lower barrier for selling, has made it easier for VARs to pitch new vendors to customers.
But analysts suggest the lawsuit says more about the financial state of C1 and Avaya. Avaya emerged from its second bankruptcy in six years in 2023, and C1 went through a Chapter 11 process in 2025. C1 at the time partially blamed customer purchasing related to Avaya’s financial woes.
It looks like theater between two companies that have faded from relevance, Dave Michels, Principal Analyst at TalkingPointz, told Channel Dive in a message.
“It feels like Blockbuster suing a VCR repair shop for contract violation in the age of Netflix,” Michels said. “The optics here are almost comical. Avaya, which has filed for Chapter 11 bankruptcy twice in six years, is suing C1, a partner that itself just emerged from its own Chapter 11 restructuring. Both companies have wiped out massive amounts of shareholder value, and are now chasing revenue in the courts.”
Rittenhouse agreed.
“[C1] did not get a strategy in place to execute cloud in time. Like the other big box telcos (Black Box, etc). The maintenance contracts churn at a high rate, and so does the base. It’s a massive hole in the boat to recover from. Likely too little too late and that’s after the bankruptcy they kept quiet on.”
Michels said the lawsuit distracts from both companies’ failure to position themselves for a cloud-native, AI-driven world.
“They are fighting over the scraps of laggards, while the sector marches forward,” Michels said.
