Kenya: Safaricom sued for alleged intellectual property theft
The case revolves around allegations that Safaricom copied an innovative idea, leading to a lawsuit by the inventor, Peter Nthei Muoki, and his company, Beluga Ltd.
Kenya's largest mobile operator Safaricom failed to stop the hearing of the infringement of intellectual property case which could cost them millions of US dollars, reports Business Daily.
The case revolves around allegations that Safaricom copied an innovative idea, leading to a lawsuit by the inventor, Peter Nthei Muoki, and his company, Beluga Ltd.
Peter Nthei Muoki and Beluga Ltd said the product Safaricom planned to roll out is similar to an idea they shared with the top communications firm's officials in 2021.
High Court Judge Josephine Mong'are dismissed the mobile operator's application seeking to suspend the petition filed by Muoki and Beluga Ltd. Muoki reportedly moved to court in 2022 seeking to be paid for gains and profits derived from the infringement of his copyright, and for the court to order Safaricom to pay him royalties and licensing fees or alternatively, the court to direct Safaricom to pay him U.S.$68 million for the product.
The product, known as 'Manage Child Account', was launched by Safaricom under a USSD code.
But Muoki said the product is similar to his product known as 'M-Teen Account', an M-Pesa sub-wallet for persons within 13 to 24 age group to enhance parental control on their spending behaviour or patterns.
He also told the court that he approached Safaricom in March 2021 to discuss his idea, but after a meeting, he was told that it would be difficult to implement the product since it would target teenagers without identification cards, a move that would need approval from the Central Bank of Kenya.
He said they then informed him that they were mulling over a similar idea.
Muoki said he was shocked to see Safaricom conducting a test run of a product that is a copy and paste of his innovation - but under a different name - a few months after their meeting.
Muoki then successfully applied to the court to compel Safaricom to produce the corroborating documents he says are in the company's possession.
Safaricom opposed the application, arguing that Muoki was seeking confidential documents relating to the Central Bank approval for a critical payment system operated by the telco with respect to M-Pesa.
