Sunday, May 18, 2008
Satyam sued for $1 billion - WTF?
Satyam Computer Services,the $ 2.1 billion Indian software giant, has been sued for $ 1 billion by Upaid Systems, online and mobile payments specialist.
Here's the extract of press release from Upaid.
"Upaid originally filed the Texas lawsuit in April 2007 following the revelation in Texas of forged documents previously provided by Satyam to Upaid. Satyam had sought a High Court injunction in London in September 2007 to try to block the Texas case, arguing that a 2003 commercial agreement terminating the relationship between the two companies precluded all future claims against it for all past practices and that any residual claims against it had to be tried in London.
The High Court categorically refused Satyam's request in January 2008. After hearing testimony from senior executives of both companies and legal experts in a four day trial, the Court ruled that the Texas claims could proceed. Satyam appealed this decision, and it was this appeal which was comprehensively dismissed last Friday by a Court of Appeal panel presided over by Lord Justice Waller, Vice President of the Court of Appeal Civil Division.
Costs were awarded against Satyam. In their further plea to the Court of Appeal for leave to appeal to the House of Lords Satyam first admitted publicly that, "...the effect of the judgment is that collateral proceedings in Texas will proceed. These are likely to be highly detrimental to the Appellant and extremely large sums of money are at stake."
This is really interesting.
"This is a very serious case of misconduct that involves fraud and forgery by one of India's leading software companies. The damage done to Upaid has been made even worse by the time wasted in London while Satyam tried to avoid the consequences of their own actions, rather than doing all it could to help a former customer by addressing the substantive issues raised in Texas. But, with the London issues out of the way, we can now look forward to dealing with what really matters in Texas, where the forgeries first came to light".
Read the full Court of Appeal Judgment here.
Except an analysis on this situation on this by Soham Das by Jump Up
Update : Soham kept his word. Read his detailed analysis on this case here.