Pretoria High Court Sets Aside Arbitrator's Partial Award in Telkom's Review
Application
JOHANNESBURG, South Africa, November 27 /PRNewswire/ -- The Pretoria High
Court today announced its decision to set aside the
arbitrator's partial award made in Telkom's dispute with Telcordia,
following the hearing of an extensive six-week review application that
started on 11 August 2003. Telcordia was ordered to pay Telkom's costs,
including the costs of three counsel.
In terms of the court order, the previous arbitrator, Boswood QC, was
removed. The case will now be heard by a panel of three retired Judges of
the Supreme Court of Appeal in South Africa.
Telkom's successful application followed a partial award made by the
arbitrator in favour of Telcordia on September 27, 2002, despite a pending
Section 20 application by Telkom in the South African High Court to resolve
pertinent legal issues on the matter.
The dispute first arose in 2000, when Telkom terminated its agreement
with Telcordia for the delivery of a fully integrated end-to-end customer
activation and assurance system.
Telcordia initiated arbitration proceedings under the auspices of the
International Chamber of Commerce (ICC) during the first quarter of 2001. In response to Telcordia's claims for outstanding amounts and certain
out-of-scope services of approximately $130 million, Telkom counter-claimed
against Telcordia for in excess of $300 million, including a claim for the
refund of monies paid by Telkom to Telcordia.
"The High Court decision vindicates Telkom's view that the partial
award was vitiated by serious irregularities. We are delighted that
Telkom's exposure to contingent liabilities will be significantly reduced
for now, and indeed, we can look forward to recovering some of our
expenses," said Telkom's Legal Services Group Executive, Mandla Ngcobo.
Special note regarding forward-looking statements All statements contained herein, as well as oral statements that may be
made by Telkom or by officers, directors or employees acting on behalf of
the Telkom group, that are not statements of historical fact constitute
"forward-looking statements" within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995, specifically Section 21E of the
U.S. Securities Exchange Act of 1934, as amended. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors
that could cause our actual results to be materially different from
historical results or from any future results expressed or implied by such
forward-looking statements. Among the factors that could cause our actual
results or outcomes to differ materially from our expectations are those
risks identified under the caption "Risk Factors" contained in the
prospectus relating to Telkom's initial public offering filed with the U.S. Securities Exchange Commission and available on Telkom's website at
www.telkom.co.za/ir, including, but not limited to, increased competition
in the South African fixed-line and mobile communications markets;
developments in the regulatory environment; Telkom's ability to reduce
expenditure, the outcome of arbitration or litigation proceedings with
Telcordia Technologies Incorporated; general economic, political, social
and legal conditions in South Africa and in other countries where Vodacom
invests; fluctuations in the value of the Rand; and other matters not yet
known to us or not currently considered material by us. You should not
place undue reliance on these forward-looking statements. All written and
oral forward-looking statements, attributable to us, or persons acting on
our behalf, are qualified in their entirety by these cautionary statements. Moreover, unless we are required by law to update these statements, we will
not necessarily update any of these statements after the date of this press
release, either to conform them to actual results or to changes in our
expectations. Andrew Weldrick, Senior Specialist, Media Relations, Telkom SA Limited, Tel: +27
12 311 1050, Mobile: +27 82 573 6772
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