Half of any settlement from Vodacom for 'Please Call Me' inventor Kenneth Nkosana Makate will have to be held in a trust until an arbitration matter with his previous litigation funders is settled.
This was the ruling of the North Gauteng High Court in Pretoria yesterday. According to Business Day, judge Neil Tuchten ordered that 50% of any future payment made to Makate by Vodacom be held in Umika Gopichund Attorneys' trust account until the conclusion of the pending arbitration.
Discussions are continuing between Vodacom and Makate over how much remuneration he is entitled to for coming up with the 'Please Call Me' idea. This after the Constitutional Court ruled on 26 April that Vodacom was bound by a verbal agreement between Makate and Vodacom's former director of product development and management, Philip Geissler, for compensation for the idea he says he pitched to Geissler in 2000.
Makate had originally asked Vodacom for 15% of all 'Please Call Me' revenue should the product be successful. That would amount to around R10.5 billion today, his legal counsel previously argued.
The Constitutional Court ordered Vodacom to start negotiations "in good faith" within 30 days of the judgement, to determine an amount to be paid to Makate, bringing a close to the former Vodacom employee's eight-year court battle.
However, the negotiations looked set to be derailed when Makate's previous financial backers launched a court application claiming they were entitled to 50% of his pending compensation.
A company called Raining Men Trade and businessman Christiaan Schoeman claim they have the right to be involved in his negotiations with Vodacom and are owed up to 50% of his settlement, because they were early litigation funders of Makate's lengthy court battle.
Schoeman argues that a funding agreement between himself and Makate, which was cancelled in early 2015, should still stand because its cancellation was done after "coercion" from Makate's lawyer Wilna Lubbe. He also makes a number of allegations against Lubbe, including "a conspiracy" to oust fellow investors that he admits he went along with. She calls his allegations "a blatant lie".
Schoeman and Raining Men also asked the court to interdict Lubbe and her law firm Stemela & Lubbe ? and a number of other named lawyers ? from representing Makate in his negotiations with Vodacom. In addition, they wanted to interdict Makate "from appointing any legal representative" without their consent.
Judge Tuchten, however, ruled that Makate held the right to choose his own representative for negotiations with Vodacom.
Arbitration
Makate can continue talks with Vodacom but must also settle the dispute with Schoeman and Raining Men by reverting back to an arbitration matter that was raised between the parties in October 2015.
The previous arbitration also covered a dispute between the parties over an addendum added to the original funding agreement in April 2014. Schoeman claims the addendum added Raining Men as a party to the agreement and changed the funding split to 50/50 between the funders and Makate.
Makate, however, argues that Raining Men was never properly nominated under the agreement and the addendum actually nominated a company called "Black Rock" as the one to fund his legal expenses going forward. He also claims he signed the addendum's final page but his initials on the first three pages were forged in a version he later saw of the addendum. He says under the document he signed in 2014, he was entitled to 53% of any payment from Vodacom, not 50%.
Makate ultimately maintains the previous funders are not owed anything because the funding agreement was cancelled long before his Constitutional Court victory and Schoeman "fully accepted this cancellation" at the time.
"On the applicants' own version, the funding agreement was cancelled in January 2015 and the applicants' rights, if any, under this agreement have been extinguished," an affidavit from Makate reads.
No compensation amount has yet been agreed to and no date has yet been set for the arbitration matter.
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