Gradient, Rocker Lose Bid to End Overstock.com Suit

Bloomberg News Service

GRADIENT ANALYTICS INC., a research firm, and New Jersey-based Rocker Partners LLC, a hedge fund, will face a trial over whether they drove down Overstock.comInc.'s shares, after losing a second bid to dismiss Oversto ck.com' lawsuit.

The California Supreme Court in San Francisco denied petitions late last week to review a lower court's decision allowing the lawsuit to proceed to trial, according to the court's Web site.

Overstock.com an Internet seller of discounted brand-name goods, claims Gradient issued false and misleading reports about the company using information from Rocker to help the fund profit on trades. Gradient and Rocker deny the claims and say the research reports critical of Overstock are protected free speech.

"The issue of free speech is central to our work," Gradient Chief Executive Officer Brad Forst said in a statement. 'As we proceed to the trial stage, we are amply prepared to address the facts of the case."

A state appeals court in San Francisco in May said whether Gradient's reports contain provably false statements made with malice should be decided at a trial. That ruling allows the case to proceed with evidence-gathering in Marin County Superior Court in San Rafael, Calif.

Fred Norton, an attorney for Rocker Partners, now Red Bank, New Jersey-based Copper River Management LLC, didn't reply to a message.