Vodacom to challenge SCA’s order to pay ‘Please Call Me’ creator R20bn, heads to ConCourt

VODACOM South Africa announced on Wednesday that it would be fighting back against the ruling made by the Supreme Court of Appeal (SCA) and the order to pay out almost R20 billion to the ‘Please Call Me’ creator, Nkosana Makate.

The telecommunications giant issued a statement on the JSE news service, SENS in which it said it will be lodging an application for leave to appeal this judgment and order to the Constitutional Court of South Africa.

The company said in a statement, “As a responsible corporate citizen, Vodacom is respectful of the judicial system and abides by the laws of South Africa.

“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.

“It is apparent from the dissenting judgment of the SCA that the majority judgment overlooked or ignored many of the issues between the parties and their evidence and submissions relating to those issues.”

After various court battles, the ‘Please Call Me’ case ended up at the SCA and earlier this month it ordered that Vodacom must use the models Makate’s team submitted to calculate the monies owed.

With this model, Makate’s legal team calculated that based on a 5% share of an estimated R205 billion in revenue over 18 years, this equates to R20 billion in compensation.

This is double what Vodacom invests in its South African network every year in the form of capital expenditure.

Vodacom said in its application for leave to appeal to the Constitutional Court that it made the following submissions:

• The SCA's order impinges on the Rule of Law in terms of section 1 of the Constitution of the Republic of South Africa 1996 ("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 Mr Makate;
• the SCA selectively chooses to only have regard to Mr Makate's evidence, as in the case of models for computing compensation payable to Mr Makate, while ignoring swathes of evidence in this regard presented by Vodacom contesting Mr 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. 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 programmes,” Vodacom further stated.

Vodacom went on to state that it had previously negotiated with Makate in an attempt to agree reasonable compensation payable to him.

“These efforts, to date, unfortunately have 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 Mr 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,” Vodacom further stated.

Technology analyst and FastCompany SA editor Wesley Diphoko said that the story of the “Please Call Me” inventor, Makate, is not about one man. He said that it is the story of young South Africans who are ignored within corporate SA.

“When Makate came up with the ‘’Please Call Me” idea, no one expected it to have come from a young man from a township. The Vodacom leadership at the time expected him to focus on his internship and earn a stipend at the end of the month. However, Makate was pregnant with township experience that informed and inspired the ‘Please Call Me’ idea,“ Diphoko said.

– BUSINESS REPORT