Vodacom ordered to pay $2.8 billion to the brain behind the famous Please Call Me service. The South African mobile telecommunications firm has however warned that the said judgment will greatly impact its operations if upheld.
Vodacom Ordered To Pay $2.8 Billion
According to the telco, should this ruling be upheld, it would have a detrimental impact not only on its employees and shareholders but also on the country’s public finances, to which it makes significant contributions. Vodacom also emphasized that the ruling would affect its network investment, coverage, and social programs, and it highlighted the unintended consequences of the decision, depicting South Africa as an unattractive investment destination.
Makate is poised to receive compensation ranging from R29 billion ($1.5 billion) to R55 billion ($2.8 billion) based on the parameters outlined by the SCA. Additionally, the ruling specifies that Makate is entitled to 27% of the voice revenue generated from the PCM messages sent daily.
Vodacom Has Petitioned the Constitutional Court for Permission to Appeal the Supreme Court Verdict
The company has petitioned the Constitutional Court for permission to appeal the Supreme Court verdict. Expressing its disappointment with the case’s outcome in a statement on Wednesday, February 28, Vodacom reiterated its status as a responsible corporate citizen, committed to upholding the judicial system and adhering strictly to South Africa’s rule of law.
Vodacom explained that it has thoroughly reviewed the SCA judgment and order and vehemently disagrees with certain key aspects, which it believes do not align with the spirit of the law. The company considers the judgment and order to be fundamentally flawed.
Vodacom’s Claims After the Verdict
Vodacom stated that its application to the Constitutional Court for leave to appeal the SCA ruling includes valid arguments, including the SCA’s purported oversight and ruling on matters that were not brought before it for adjudication by either Makate or Vodacom.
Vodacom and Makate have been embroiled in a legal dispute over the PCM service, which the former employee reportedly conceived in 2000, since 2008. The telco asserts that it had previously attempted to negotiate reasonable compensation with Makate but claims that these efforts have been unsuccessful thus far.
The Company’s Willingness to Engage in Good Faith Dialogue and Negotiations
The company reiterated its willingness to engage in good faith dialogue and negotiations to reach a reasonable settlement, without prejudicing its Constitutional Court appeal process.
Shameel Joosub, Vodacom Group CEO, had determined a compensation package of R47 million for Makate following a 2016 Constitutional Court order. However, Makate reportedly rejected the offer, subsequently applying to the Gauteng division of the High Court to overturn Joosub’s offer.
The High Court’s Previous Ruling
On February 8, 2022, the High Court ruled that Joosub reconsider the compensation, overturning the initial offer. Later that month, Vodacom filed an application to appeal the High Court’s judgment and order.
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