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Telcordia Prepares for Court

Telcordia Technologies Inc. has had a busy week. While its M&A legal team was busy wrapping up the acquisition of inventory management system vendor Granite Systems Inc. (see Telcordia Shells Out at Last), its briefs in South Africa lost the right to appeal against a ruling made late last year.

Basically, Telcordia is in a dispute with South Africa's incumbent operator Telkom SA Ltd. over an OSS contract that went pear-shaped back in 2000. Telkom didn't think the activation and assurance system delivered by Telcordia was up to scratch, so it cancelled the order.

Telcordia then claimed $130 million from the carrier for monies it believed it was still owed, and Telkom counter-claimed for $300 million, including monies already paid out. While an initial ruling by an International Chamber of Commerce (ICC) arbitrator found in favor of Telcordia, the Pretoria High Court quashed that ruling in November last year and sent the case to South Africa's Supreme Court of Appeal (see Telkom vs Telcordia: Case Not Closed).

Now the same court has dismissed Telcordia's application to appeal against the November decision, and has awarded costs against the OSS vendor. That means Telcordia will now have to sweat it out until the Supreme Court hearing, and hope that home turf advantage doesn't come into play.

So what's the deal? Telkom is playing it cool, noting only that the latest decision means the whole legal episode will start again from scratch at the Supreme Court, where three retired judges will consider the case at an as yet undetermined date.

Even less was to be had from the OSS firm. Because of its stated policy to refuse all media requests from Light Reading Inc. and its affiliated sites, we were unable to obtain comment from Telcordia.

— Ray Le Maistre, International Editor, Boardwatch

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