Satyam loses appeal in Upaid case; may face $1 billion plus penalties

15 May 2008

In a case spanning three continents, India's fourth-largest software exporter, Satyam Computer Services is being sued by Upaid Systems, a UK-based online and mobile payments service company, in Texas.

Call it the perils of globalisation, for Satyam could be staring down the gun barrel at more than $1 billion in penalties, depending on how the case pans out.

Upaid is an old Satyam client dating back to the heyday of the dotcom boom of the late 1990s. In 2006, it had filed certain claims of infringement against some companies in the US and in the proceedings, two former Satyam employees were also named, who later denied signing the patent assignment documents in 2002.

Upaid then filed a lawsuit in a Texas court in 2007 alleging that Satyam provided forged documents to Upaid in patents filing that eventually resulted in the company losing its patents infringement case against telecom giants Qualcomm and Verizon.

It has claimed compensatory and punitive damages from Satyam in the case that is scheduled for hearing in June 2009 in the Texas court.

''The damages, to be awarded, will be determined by a jury in Texas. I cannot predict the future. But going by the numbers in the public documents that have been filed over the course of the proceedings in the London court, the amount could be considerably over $1 billion,'' said Upaid chairman and CEO Simon Joyce.