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Vodacom appeals 'fundamentally flawed' Please Call Me judgment

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Pan-African operator Vodacom has approached South Africa's Constitutional Court (ConCourt) over its drawn-out battle with Nkosana Makate and the "Please Call Me" (PCM) service and asked for leave to appeal a previous judgment from the Supreme Court of Appeal (SCA).

The South African-headquartered operator approached the apex court after the judgment earlier this month which ordered it to pay Makate between 5% and 7.5% of the total money generated from the PCM idea, including interest – revenue generated over 18 years, from 2001 to 2019.

Makate is credited with coming up with the PCM idea back in 2000, which allows mobile users without any airtime to send a free text message requesting that someone call them.

In its application for leave to appeal to the ConCourt, Vodacom argued that the SCA judgment and order were "fundamentally flawed" and called the orders "unintelligible, incomprehensible, and vague."

"Having considered the SCA judgment and order, it is Vodacom's view that there are key aspects of this matter which do not accord with the spirit of the law and that the judgment and order are fundamentally flawed," the telco said in a statement.

Moreover, Vodacom argued that the majority of the SCA judgment overlooked or ignored many of the issues between the parties and their evidence and submissions relating to those issues.

In its ConCourt appeal Vodacom made the following submissions:

  • The SCA's order impinges on the rule of law in terms of section 1 of the Constitution and deprives Vodacom of its right to a fair trial under section 34 of the Constitution;

  • The SCA misdirects itself by considering and deciding on issues which had not been placed before it for adjudication by either Vodacom or Makate;

  • The SCA selectively chooses to only have regard to Makate's evidence, as in the case of models for computing compensation payable to him, while ignoring swathes of evidence in this regard presented by Vodacom contesting Makate's version; and

  • The SCA orders are unintelligible, incomprehensible, and vague rendering them incapable of implementation and enforcement.

    "The impact of the SCA judgment, should it be upheld, would be vast and wide-ranging on both Vodacom South Africa and Vodacom Group, as well as the attractiveness of South Africa as an investment destination," Vodacom said.

    "It would negatively impact our employees, shareholders and Vodacom's contribution to public finances. It would also have an impact on our network investment, coverage, and social programs," it continued.

    Vodacom said it had previously negotiated with Makate to agree to reasonable compensation payable to him. However, those negotiations failed.

    "Vodacom remains open to constructive dialogue and good faith negotiations and, without prejudice to its Constitutional Court Appeal process, to agree a fair and reasonable amount as compensation for Makate's idea that led to the development of the PCM product. It is Vodacom's desire that the matter be amicably resolved and brought to a timely conclusion," the telco concluded.

    The 'Please Call Me' genesis

    The legal battle between Makate and Vodacom began in 2008 when he was not compensated for his PCM idea. Since then, the matter has been in and out of South African courts and by the looks of things, the battle continues.

    Vodacom said it had previously negotiated with Makate to agree on reasonable compensation, however those negotiations failed.   (Source: Paula Gilbert)
    Vodacom said it had previously negotiated with Makate to agree on reasonable compensation, however those negotiations failed.
    (Source: Paula Gilbert)

    In April 2016 the Constitutional Court ordered Vodacom to "negotiate in good faith" and provide "reasonable compensation" to Makate for his PCM idea.

    After no agreement was reached, the Constitutional Court ordered Vodacom's current CEO, Shameel Joosub, to determine a reasonable amount of compensation to be paid to Makate. In January 2019, Joosub offered R47 million (US$3.1 million at the time).

    That offer was way below what Makate thought he deserved. He had originally asked Vodacom for 15% of all PCM revenue should the product be successful. In 2016, his legal counsel argued that would amount to around R10.5 billion ($693.6 million at the time).

    Follow Connecting Africa on our new X account @connect__africa to get the latest telecoms and tech news across Africa.

    In early 2022, the Pretoria High Court, set aside the Vodacom CEO's determination and ordered him to reconsider the settlement offered to Makate, and the case has continued in the courts ever since.

    Related posts:

    *Top image is of Vodacom Group CEO Shameel Joosub (Source: Vodacom Group).

    — Matshepo Sehloho, Associate Editor, Connecting Africa

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