The Arlington, Va.-based organization was joined by the Chartered Financial Analyst Institute in asking the California District Court of Appeal to dismiss Overstock's suit.

Gradient spokeswoman Karen Hinton called the organizations' input significant "because two highly-respected organizations . . . share our concern that, if this lawsuit proceeds, independent financial analysis, whether written by a journalist or an analyst, will become a thing of the past."

Overstock alleges that Gradient and co-defendant Rocker Partners colluded, along with willing critics in the financial news media, to drive down the price of the Salt Lake City-based company's stock, Shares had traded at $77.18 in January 2005; on Tuesday they closed at $17.97, up 46 cents.

Specifically, Overstock claims that Rocker timed its "short selling" - a practice in which stock is borrowed and sold, with sellers betting they can buy back the stock and bank the difference when share prices fall - with Gradient's negative reports on the company.

Overstock CEO Patrick Byrne saw the filings as indicators of Gradient's desperation.

"Though these analysts now try to hide behind the skirts of the First Amendment, analysts are human too, and subject to the laws and regulations that govern our markets," he said. "We alleged that the analysts committed numerous regulatory and legal violations, in effect knowingly 'shilling' for a few favored clients: this was, in fact, their business model."