The Innovators Clash: Solut Technology Limited v Safaricom Limited

Introduction

Picture this: You have just poured countless hours and significant resources into creating a groundbreaking app that could revolutionize how people do business. You are excited to show your innovative creation to the world, eager to garner the recognition and success it deserves. But your dreams are dashed when you present your concept to a major company, only to have them launch a strikingly similar app, stealing the spotlight and leaving you feeling frustrated and underappreciated.

In September 2024, the case of Solut Technology Limited v Safaricom Limited was dismissed.¹ This case revolved around allegations that Safaricom’s application, Thibitisha, infringed on the copyright of Solut Technology Limited’s app, Wavu.

The plaintiff, Solut Technology Limited, asserted that on October 31^st 2016, they had uploaded their software application onto the platform known as Zindua Cafe, with the intention of commercializing it and its potential purchase. On November 11^th 2016, the plaintiff met with the defendant’s representative to demonstrate the operational concept of their innovative app. The defendant issued a regret letter after evaluating the Wavu application, stating it was not a priority. However, the plaintiff alleges that the defendant, after reviewing the app, developed and launched a similar application, Thibitisha, infringing on its intellectual property and breaching its duty of confidence.

In response, the defendant argued that the Thibitisha program was developed independently and that the plaintiff, through the terms and use conditions on their Zindua Cafe program, had effectively waived any rights to the Wavu application, thereby granting the defendant irrevocable and unrestricted rights to the idea.

This blog aims to capture the court’s thorough analysis of the key issues for determination, namely: whether the defendant infringed on the plaintiff’s copyright, whether the defendant was guilty of a breach of confidence, and whether the defendant’s Zindua Cafe terms and conditions were unconscionable.

Copyright infringement of the Wavu Application?

Section 22 of the Copyright Act establishes that computer programs are recognized and protected as literary works under the law.² The Act defines computer programs as “a set of instructions expressed in words, codes, schemes, or any other form capable of causing a computer to perform a particular task or result when incorporated into a medium that the computer can read.”³ The defendant argued that the Wavu application was not formally registered as a copyright, and therefore no copyright existed. However, this counter-argument was invalid, as formal registration is not a prerequisite for copyright protection.⁴

The Act clarifies that for computer programs to be protected, they must be expressed in a medium readable by a computer, such as instructions in codes or words.⁵ This requirement ensures that the software, like the Wavu application, can be identified, preserved, and protected, which is crucial for effective copyright enforcement.

The court, in agreement with the defendant, concluded that the plaintiff failed to sufficiently prove ownership of the Wavu application’s copyright due to the lack of registration or fixation of the work in a tangible medium. Additionally, the plaintiff admitted to submitting only a concept note and not the actual source code to the defendant, which weakened the plaintiff’s argument that the defendant had copied the concept and passed it on to Safaricom to create the Thibitisha program.

Copyright law protects the expression of ideas, not the ideas themselves. Thus, there is no copyright in “mere ideas, concepts, schemes, systems or methods.”⁶ This ties in with the concept of “idea-expression dichotomy” that asserts a boundary between protectable expressions of ideas and the unprotected ideas themselves, as it affirms that, while the expression of an idea can be copyrighted, the underlying idea cannot be owned or monopolized.⁷ The wider justification for the concept is underlined with the belief that ideas are public resources, not private possessions.⁸ This notion underscores the importance of the freedom to express and develop ideas, which is essential for artistic and intellectual advancement.⁹ Tying this with the current case, since the plaintiff did not provide the source code, the tangible expression of the software, the analysis determined that the plaintiff could not prove the defendant had copied the protected elements of their work.

Breach of Confidentiality?

The plaintiff claimed that the defendant had breached an obligation of confidence by unfairly utilizing the plaintiff’s confidential information provided thus causing harm to the plaintiff. Their argument was that the defendant benefitted from the information without proper consent or compensation. However, the judge noted that the law of confidence, as submitted, does not have a statutory basis but is rooted in equity and common law. The principles of confidentiality were supported by previous case law, including the Fraser v Thames Television case,¹⁰ which was cited as leading precedent. The Fraser case held that the equitable doctrine of confidentiality prohibits the unfair use or profit from information received in confidence without consent or compensation. To claim infringement, the plaintiff must prove the communication was confidential, the idea was identifiable, original, commercially viable, and capable of realization. The Court of Appeal in the case of Fischer and Fischer Marketing Concepts v Equity Bank Limited & Another¹¹ reaffirmed that the obligation of confidence ceases once information becomes public knowledge.

The judgment highlighted the three essential elements necessary to establish a breach of confidentiality.¹² First, the information must have had a confidential nature. Second, it must have been communicated under circumstances that created an obligation of confidence. Third, there must have been unauthorized use of the material. It was concluded that the plaintiff failed to establish the Wavu application as one that contained confidential information.

Moreover, the judge highlighted that, by accepting the terms and conditions of the Zindua Café platform, the plaintiff had expressly agreed that the information submitted no longer was confidential, as stipulated in Clause 3 of Zindua café’s terms and conditions terms. This weakened the plaintiff’s claim, as they had bound themselves to terms that permitted the defendant to disclose the information. It was reinforced that courts cannot rewrite contracts freely entered by parties unless there is evidence of coercion or fraud. Since the plaintiff voluntarily agreed to the terms, including those related to the use and disclosure of submitted information, the claim for breach of confidentiality could not stand.

Zindua Cafe terms and conditions unconscionable?

The plaintiff argued that the terms and conditions were unconscionable, stating that unconscionability included both an imbalance in bargaining power and the inclusion of harsh or unfair terms. However, the judge found no evidence of such inequality or unfairness. The judge noted that the plaintiff had access to legal representation and was not under undue pressure to accept the terms. The Competition Authority of Kenya had also confirmed that the plaintiff was aware of the terms and conditions before engaging with the platform.

Furthermore, the judge emphasized that the Zindua Café platform had warned users to protect their intellectual property before submitting ideas, which the plaintiff had failed to do. This failure was acknowledged during cross-examination, and no valid explanation was provided. Therefore, the consequences of the plaintiff’s claim were the result of their own actions, not of any unfairness in the contract. The court concluded that the terms and conditions were neither unreasonable nor unfairly tilted in the defendant’s favor, as they established reciprocal obligations for both parties.

Conclusion

The case reminds us, it is not just about having a brilliant idea; it’s also about understanding the legal landscape that comes with sharing that idea. The judgment reinforces the importance of being diligent and cautious when submitting your work to public platforms. Whether it’s copyright protection, breach of confidentiality or those pesky terms and conditions we often overlook.

The plaintiff’s downfall here was not just about the facts of the case but also about failing to fully protect their intellectual property before sharing it. Safaricom’s Zindua Café had terms and conditions that clearly outlined the nature of submissions, and by agreeing to them, the plaintiff effectively waived their right to confidentiality.

So, what’s the takeaway? Carefully review the terms and conditions before submitting your next big idea. Take the time to critically assess the platforms you are using and ensure your intellectual property is properly safeguarded. Understand the rights you’re agreeing to surrender. As this case demonstrates, the distinction between protecting your work and losing it can hinge on just a few clicks.

The picture was developed using the AI tool DALL E.