In what is being touted as a big win for the startup economy, Automatic Data Processing Inc., a leading payroll company, agreed to drop its defamation suit against Zenefits, a rapidly-growing Silicon Valley competitor. A federal judge dismissed the case with prejudice.
"It seems clear to me that ADP has no claim for defamation," said U.S. District Judge Vince Chhabria, the Wall Street Journal reports.
The lawsuit was borne out of a dispute sparked by ADP's decision to block Zenefits from accessing payroll data for hundreds of mutual clients. Although the two companies are competitors, they also share hundreds of clients that use ADP's payroll processing program along with Zenefits' free employee benefits tools.
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