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Morningstar sued for \'screen-scraping\'

Date: Tuesday, February 3, 2009
Author: David Hoffman, Investment News.com

NewRiver Inc., a software provider, filed a lawsuit today in Massachusetts state court alleging that Morningstar Inc. illegally accessed its proprietary software — access it says that the research firm used to engage in unfair competition.

Beginning as early as May 2008, Morningstar began “screen scraping” NewRiver’s Prospectus Express web-based warehouse of compliance documents for every open-end mutual fund, variable annuity and variable-life product sold in the United States, according to the complaint.

A screen scraper is a computer program that extracts data from the display of another program.

After heavily screen-scraping Prospectus Express, Chicago-based Morningstar made a series of presentations to NewRiver clients in an attempt to get them to drop the company as their service provider, according to the complaint.

The presentations caused NewRiver clients to demand price reductions from the company, concessions it granted, according to the complaint.

Morningstar made its presentations after talks of a “strategic partnership” with NewRiver of Andover, Mass., broke down, the suit said.

"We believe NewRiver’s lawsuit is without merit, and we will strongly defend our position," Morningstar spokeswoman Margaret Kirch Cohen wrote via e-mail.

“This lawsuit has one purpose: to discourage Morningstar from competing with them. NewRiver's representatives made it clear to us that unless we agreed that we wouldn't compete with them, they would sue us."