Makate wants billions from Vodacom

Nkosana Makate says he deserves billions from Vodacom for suggesting a Please Call Me service to the company. Vodacom, however, feels that its R47 million offer is fair.

The battle over compensation is being heard in the North Gauteng High Court, with Makate asking Judge Wendy Hughes to tell Vodacom how much it should pay him.

To understand the dispute, one has to go back to 2001 when he shared an idea for a Please Call Me-type service with then director of product development at Vodacom, Philip Geissler.

Geissler told Makate he would receive compensation for the idea, although he didn’t have the authority to make this promise.

This promise cost Vodacom dearly. It opened the door for Makate to demand a large sum from the mobile operator for his idea.

Vodacom would, however, not entertain Makate’s demands, and a protracted legal battle followed.

Makate wanted R6.75 billion from Vodacom, but in 2014, the South Gauteng High Court dismissed his case against Vodacom with costs.

He appealed this ruling, and after the Supreme Court of Appeal rejected his application, he took the matter to the Constitutional Court.

In April 2016, the Constitutional Court found that Vodacom was bound by the agreement Geissler made with Makate.

It instructed the Vodacom to enter into negotiations about what constitutes fair compensation for the Please Call Me idea.

Makate asked for 15% of all revenue Vodacom accrued through the Please Call Me service, which he placed at around R10 billion.

Vodacom did not share Makate’s view and negotiations between the two parties reached a deadlock.

In line with the constitutional court order, Vodacom CEO Shameel Joosub stepped in as deadlock-breaker and determined a “reasonable compensation” amount – R47 million.

Shameel Joosub, Vodacom CEO
Vodacom CEO Shameel Joosub

Makate was not satisfied with this offer and returned to the courts to review the offer from Joosub.

As part of this review Makate asked the court to force Vodacom to disclose its finances related to the Please Call Me technology.

He was successful, and in June last year North Gauteng High Court has ordered Vodacom to provide him with extensive information to help his team determine how much the company should pay him.

Vodacom filed for leave to appeal the judgement, but later merely requested that the judge amend the order.

Vodacom wanted the judgement to be changed to require that the network provide Makate with the necessary data “only to the extent to which it has in its possession.”

The matter is now before the North Gauteng High Court where Makate is asking the judge to review the R47 million offer and tell Vodacom how much it should pay him.

Makate wants his compensation to be based on revenue generated by Vodacom through the Please Call Me service.

Vodacom, in turn, said as long as Joosub arrived at his decision honestly and in good faith, there is no basis upon which a court may interfere.

Nkosana Makate
Nkosana Makate

Speaking to the SABC, Makate said based on the revenue which Please Call Me has generated, he is owed billions from Vodacom.

He said this figure comes from expert calculations with “what Please Call Me would have generated over the air”.

Makate added that Joosub has ignored a lot of facts they have presented to him and did not take these facts into account when making his R47 million determination.

“The court now needs to assess whether the CEO was right to ignore all the evidence we put before him to make his determination,” he said.

Makate further dismissed the argument that he was working for Vodacom at the time of his idea and could therefore not ask for additional compensation for it.

“If you develop something in the scope of your employment it will belong to the company. For things outside of this scope, you can enter into commercial agreements because it does not belong to the company,” he said.

Vodacom headline

Vodacom told MyBroadband position regarding the matter is clearly articulated in its replying affidavit, which will form the basis of our argument during the High Court proceedings in the days ahead.

“As such, it would be prejudging the deliberations and outcomes of the proceedings for us to make any pronouncements on the issues being ventilated before Justice Wendy Hughes in the High Court,” it said.

Vodacom pointed out that it has repeatedly stated its willingness to pay Makate a substantial amount.

“Vodacom still holds the view that it entered into negotiations and negotiated with Makate in good faith, in accordance with the Order of the Constitutional Court,” it said.

Now read: Makate did not invent anything and his idea was not technically possible – Ari Kahn

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Makate wants billions from Vodacom