Files to find out what Vodacom owes 'not there'

29 January 2017 - 02:01 By ASHA SPECKMAN
Nkosana Makate has gone to the Constitutional Court again to clarify its order that Vodacom has to pay him as originator of the Please Call Me service.
Nkosana Makate has gone to the Constitutional Court again to clarify its order that Vodacom has to pay him as originator of the Please Call Me service.

Vodacom lacks most of the records required to determine how much it owes Nkosana Makate for the Please Call Me product, the cellular giant argues in court papers that seek to have a fresh application tossed out of the Constitutional Court.

However, Nkateko Nyoka, Vodacom's chief legal and regulatory officer, denied in his affidavit filed this week that this statement was part of another set of delaying tactics.

Nyoka said negotiations had disintegrated in September last year after Makate had "unilaterally" terminated talks and approached the court in November.

Vodacom had demonstrated it was "at all times acting in good faith". It had tendered access to its information systems and relevant documents but with the necessary safeguards to protect customer information, he said.

His affidavit follows claims by Makate in an affidavit filed in November seeking clarity on the Constitutional Court ruling that bound Vodacom to negotiate and compensate him for his Please Call Me idea, which Vodacom launched in 2001.

Makate claimed Vodacomhad prevented him from gaining access to important records and had suggested it had not gained any competitive advantage from his idea.

Nyoka said that during negotiations Vodacom had very senior executives - chief human resources officer Matimba Mbungela and chief financial officer Till Streichert - at the negotiating table, which showedit had prioritised the matter.

Vodacom had also enlisted the services of an unnamed German expert "with considerable experience in the field of compensation for employees' ideas and inventions", Nyoka said.

But Vodacom then discovered that most of the documentation sought "did not exist or at least [not for] immediate extraction and that determining what was capable of being provided would take a considerable time." An expert's report it had commissioned confirmed this, he said.

Vodacom faced "considerable difficulties in providing the information ... since the product was never treated in its income statement as a revenue-generating product, even though the original intention was to charge for the service".

Nyoka added that, "significantly, Mr Makate appeared to accept this and agreed to continue with negotiations in the absence of the information that he had sought."

But even if the practical difficulties of the records were resolved, "determining the level of principle as to what does and does not qualify as revenue generated by the product may prove insurmountable in negotiations", Nyoka said.

Even if the parties never agree on what compensation will be based on, "they may nonetheless agree to a reasonable compensation amount that is mutually acceptable to both sides".

Nyoka also argued that Vodacom was prepared to negotiate for a share of the revenue and had made its information systems available.

Makate had not exercised all his options for dispute resolution before approaching the court, he said.

"In this context the application is premature and should not have been brought ... in circumstances where Mr Makate has not fully exhausted all of his remedies."

Makate is to file a reply to Vodacom's affidavit within 10 days of its submission.

The protracted battle between Makate and Vodacom reached fever pitch last April when the Constitutional Court overturned a High Court judgment and ruled that Vodacom had to enter into negotiations to compensate Makate for his idea.

But in September negotiations disintegrated and in November Makate filed another application seeking clarity on the court order.

He claimed Vodacom had questioned whether it had gained any competitive advantage from his idea. Makate also wanted an order for Vodacom to give him or his expert access to records of the revenue that Please Call Me had generated since its launch.

In 2000 Makate approached his superiors at Vodacom with an idea to allow a person without airtime to send an SMS to another cellphone number and request a return call. At the time he was a trainee accountant. Later, the head of product development reneged on an agreement to compensate him, leading to what became a 15-year battle.