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Vodafone joins Please Call Me battle

● “Please Call Me” (PCM) inventor Nkosana Makate has accused telecommunications multinational Vodafone, which is trying to intervene in his two-decade legal battle with Vodacom, of exaggerating the financial impact of his claim against the local company.

This week, Makete filed papers in the Constitutional Court opposing an application by Vodafone — the majority shareholder in Vodacom — to be admitted as amicus curiae (friend of the court) in the case, now due to be settled by the highest court in the land.

Vodacom went to the Constitutional Court in February in a bid to quash a ruling by the Supreme Court of Appeal that it should make a new compensation offer to Makate for his PCM idea.

The SCA set aside a R47m offer that Vodacom CEO Shameel Joosub made to Makate five years ago, and which he rejected.

Instead it ordered Vodacom to pay Makate between 5% and 7.5% of the total voice revenue generated by the PCM service over an 18-year period from March 2001, plus interest.

Vodafone and Vodacom say this would translate to a payout of between R29bn and R63bn.

London-based Vodafone said in its friend of the court application that it wanted to “enrich the debate and subsequently contribute towards the effective, and indeed properly contextualised, disposal of the appeal”.

In his affidavit, Nickola Vidovich, Vodafone’s chief legal director, said the company sought to “offer a foreign shareholder and international investor’s perspective on the significance of the matter”.

“This may well be a commercial dispute between two contracting parties, but certain commercial disputes (like this one) sometimes give rise to constitutional consequences for others,” he said.

Vodafone’s financial stake in Vodacom should not be an impediment to admission as amicus curiae.

“I understand that absolute neutrality is not a requirement for [this]. However, what is important is that submissions are proffered with the view to achieve a just outcome. Vodafone intends to do exactly that,” said Vidovich.

Makate responded that Vodafone’s application was premature as the Constitutional Court had not yet decided whether it would accept Vodacom’s application.

The inventor said Vodafone should have sought to get involved at a much earlier stage, and as a litigant, not a friend of the court.

“Vodafone has known since the delivery of my founding affidavit in the review application in 2019, what kind of impact the order I was seeking would have, if my review application were successful. Vodafone elected to remain supine,” Makate said.

He submitted that the multinational was seeking friend of the court status to avoid consequences it would face if it intervened as a litigant.

He accused Vodafone of trying to introduce new evidence to back up Vodacom’s case.

“Vodafone is not an amicus curiae, but a 65% shareholder of Vodacom ... Its interests are exactly the same as those of Vodacom. However, Vodafone failed to seek leave to intervene in this matter for several years and now seeks to enter in the matter to protect its private interests under the guise of seeking to assist the court,” Makate said.

Vidovich said his company wanted to offer its views on “the importance of predictability as a facet of the rule of law ... the right of access to court [and] how the misapplication of jurisdictional principles affects the rule of law”.

It also wanted to show that the SCA’s “jurisdictional overreach” would have a tangible impact beyond Makate and Vodacom.

The financial implications of the SCA decision would hit funding for more than a dozen Vodacom initiatives or programmes, Vidovich said. These included the rural connectivity rollout, disaster relief efforts and agricultural projects that benefited 8.2-million small-scale farmers, most of them in South Africa, Tanzania and Kenya.

Vidovich said bursaries offered by Vodacom to previously disadvantaged and lowincome communities in South Africa would be among initiatives affected.

“Should the SCA majority order stand, it is expected Vodacom would be forced to retrench numerous employees in an attempt to comply. This would significantly impact Vodacom’s (and Vodafone’s) productivity and profitability.”

But Makate said the capital amount he sought when his claim was still before the Pretoria high court in October 2020 was R9.7bn.

“The figure (R9.7b) is the real impact of the majority of the SCA’s order. Not R63bn as Vodafone and Vodacom contend. Vodacom and Vodafone have known with precision ... the capital amount I was seeking,” he said in his replying affidavit.

He accused Vodafone of using figures that were “exponentially larger than my claim under the order” to paint a catastrophic picture.

Makate said Vodafone’s description of the possible financial impact of the SCA decision was an entirely new issue that Vodacom had not raised.

“Vodafone is using its amicus application to supplement Vodacom’s (defective) case,” he said. The new evidence was inadmissable because it “goes beyond the kind of evidence an amicus is permitted to introduce before the court”, and a friend of the court should be bound by the facts already on the record.