Gradient began covering Overstock in 2003 and has been critical of the company. In its latest report, Gradient gave the company's earnings quality an "F," citing concerns about aggressive accounting and the company's disclosure on Sept. 16 that sales had slowed sharply.

"Given the nature of our work, it is no surprise that our views on many of the companies we cover are unpopular in some corners — particularly among those we have criticized," Gradient told customers in a Sept. 28 letter.

Overstock posted an annual net loss four years running. Its shares have fallen 51 percent this year. Of 13 analysts tracked by Bloomberg, one recommended buying the stock, eight recommended holding it and four recommended selling.

Overstock.com President Patrick Byrne, who was replaced as chairman by his father Oct. 25, has complained that his company has been damaged by short selling.

In an Aug. 12 Webcast announcing his lawsuit, Byrne described a conspiracy among investors, reporters and others to push Overstock's shares down and said the plot was being orchestrated by an unidentified mastermind he called the "Sith Lord," a reference to the arch-villains in the "Star Wars" films.

He said the SEC had questioned his general counsel earlier this month about the three men's affidavits.

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Contributing: Andrew Dunn