Kenyan Court Quashes Popote’s $8.5M Claim Against Safaricom: A Win for the Telco Giant
Safaricom PLC has secured a significant legal victory after the High Court in Nairobi overturned an arbitral award that could have cost the telecommunications giant over $8.5 million. The ruling centered on a dispute with Popote Innovations Ltd. regarding a co-developed digital payments platform, Popote Pay. Popote alleged that Safaricom abandoned their joint project before launching the M-Pesa Super App and M-Pesa Business App, which Popote claimed incorporated features from their collaborative concept.
Unsigned Agreement Undermines Popote’s Case
Justice Peter Mulwa, presiding over the Milimani Commercial and Tax Division, determined that the core of Popote’s claim rested on a 2018 partnership agreement that was never officially signed by Safaricom. The court concluded that without Safaricom’s signature, the agreement was not legally binding, rendering the arbitration clause within it unenforceable. Popote’s initial compensation claim of $358,000 was later significantly increased to include a monthly revenue share of approximately $357,000 over a 15-month period, bringing the total claim to roughly $5.4 million during arbitration. The court’s decision effectively dismisses Popote’s claim, shielding Safaricom from the substantial financial burden.
This ruling highlights the critical importance of formally executed contracts in business dealings, particularly within Kenya’s rapidly evolving tech landscape. The case underscores the potential pitfalls of relying on unsigned agreements and speculative revenue projections when pursuing legal action.
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