SpicyIP Tidbits: Satyam loses appeal against Upaid: update

Some of you might remember the Satyam vs Upaid case that SpicyIP had reported on some months ago. There is an update to that, which I thought was worth running here, even though it is only distantly related to IP issues.

Satyam went to the Court of Appeal in London in that case, which it lost this week with the ruling affirming the original January judgement, and directing Satyam to pay costs. This also means that the original litigation in Texas (which Satyam had tried to halt with this London matter) will continue as scheduled. The next date of trial is in January 2009, we are informed.

Satyam has been accused of fraud, forgery, misrepresentation and breach of contract, in a case involving an IPR Assignment Agreement, by its one-time client Upaid, a UK-based IT company.

Nobody is going out on a limb with the numbers in the game, but everyone concerned is agreed that Satyam might have to fork out a fair bit.

DNA and TOI update us on the case separately. Interestingly, DNA doesn't give us the "news" until well into the third page, after spending the first two pages quoting extensively and verbatim from the original SpicyIP post, which I found very amusing, to say the least.

Couple of interesting addenda, though, in the DNA report, on the original US case (the London matter has essentially dealt with jurisdictional issues). Satyam CFO Srinivas Vadlamani is quoted, on matters I suspect are sub judice, saying that Upaid losing the patent litigation was unrelated to the documentation the company provided.

“As per our software contract, we will not take responsibility for either the product or the patents subsequently. If the documentation was wrong they should not have accepted it in the first place.”

“The documentation we were to provide pertained to a list of the people who worked on the project with their attestation that they had no claim on the patents. While the litigation so far has been on the jurisdiction of the case, the actual subject matter has not come up for legal debate, which we are confident we will win,” he said.

The Satyam legal team has also gone into a huddle. “We are covered through the directors and officers’ liability insurance. We are confident we will not pay any damages to them,” he said.

On asked why Satyam did not report the litigation to shareholders though it was filed in July 2007, Vadlamani said, “This is a very small case and we thought it was not material enough and therefore it did not warrant reporting.”

I shall not venture into premature discussion about the case. But, it is certainly a precedent and a warning for those in the business to be more scrupulous in their service agreements.