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Wipro comes out fighting after IP theft accusation

Read time 4min 10sec
CSM says the dispute centres on a South African training initiative.
CSM says the dispute centres on a South African training initiative.

A small South African non-profit organisation, the South African Collaborative Stakeholder Movement (CSM), is accusing Indian IT outsourcing giant, Wipro, of intellectual property (IP) theft.

Wipro has in response stated it will "defend itself vigorously".

CSM has filed court papers alleging the New York Stock Exchange-listed Wipro appropriated its IP.

The NGO says it decided to take legal action after the Bangalore-based Wipro ignored its protests about the IP in question.

In a statement, CSM says the dispute centres on a South African training initiative. According to the company, Wipro was accorded exclusive sponsorship for CSM's chief information officer training programme, which was to be launched in September 2014.

"We had entered a partnership with Wipro, based on our ideas and our IP, but suddenly they seemed to have cold feet," says Martin Humphries, CSM's chief executive.

"The next we knew, they had gone behind our backs and launched an identical training scheme to the one we at CSM had devised, partnering this time with the Gordon Institute of Business Science (GIBS).

"We are surprised by this blatant appropriation of our IP by a multinational which prides itself on its ethical business practices, and which has won awards for its moral way of doing business. This was certainly not our experience of how they operate."

Multimillion claim

Humphries told ITWeb that CSM's initial claim in the case is R3.525 million.

On GIBS's involvement, he said: "GIBS enters the picture as they were approached by Wipro with our idea. They are not directly culpable, but enabled Wipro to implement a mirror image of our project, with our IP.

"We are concerned about the way we were treated and the refusal by Wipro to concede that they have done wrong. We have an agenda of boosting skills development in SA, and this whole saga has been a major setback for us," says Humphries.

CSM says it has directly approached Wipro chairman Azim H Premji and has held talks with his team in Johannesburg to try to settle the dispute and secure recompense for the actions of the Indian company, but there was no meeting of minds.

"The actions of Wipro have cast a stain on the reputation of the Indian business, and we were astonished that when we pointed out how we have clearly been wronged, there was no immediate effort to put things right," says Humphries.

"While we welcome the growing business links between India and South Africa, with top-level talks in Sandton at the end of April, we feel compelled to draw the attention of the Indian and South African governments and local and Indian business leaders to how we have been wronged. If we back down on our court action, the same could happen to others."

Responding to the allegations, Wipro sent a short statement to ITWeb saying: "Wipro adheres to the highest standards of integrity and ethical corporate practices. These allegations are baseless and Wipro will defend itself vigorously."

Ideas versus concepts

Stephen Hollis, an IP lawyer and partner at Adams & Adams, says South Africa's IP legislative framework, including laws relating to trademarks, copyright, design law, patent law and our common law, and the country's laws on contracts, afford good legal protection and enforcement mechanisms for all IP owners, whether for individuals, small to medium companies or large corporations.

For smaller companies, Hollis says they should identify and understand the value and nature of their IP assets (and, if need be, consult with an expert IP lawyer to establish clarity on this) and take appropriate steps to secure statutory protection where possible (for instance, through trademark, patent, design, registration processes) and, when dealing with a third party, ensure confidential information is only communicated on the basis of a non-disclosure agreement or a contractual arrangement (when a shared venture is entered into) which clearly identifies and ring-fences the IP concerned and licenses the use thereof to the third party under very specific conditions.

"An important point to consider, as a general rule, is that legal protection is often only awarded to material expressions of ideas - not in concepts on their own. Also, legal protection might only be available if those material expressions are original and novel worldwide, so not every idea that is pitched to a potential business partner would qualify for legal protection," Hollis concludes.

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