The debate concerns the very nature of a dictionary. Merriam-Webster and the Oxford English Dictionary are descriptive works: they record the attested usage of a word, they do not prescribe it and pass no judgement on its accuracy. Removing an entry because it displeases the party it refers to would amount to changing profession.
The company's position is also understandable: it disputes the description of its jobs that the word conveys, and highlights its employees' internal career paths.
No court has been seised. The word remains in the dictionaries.