The Amazon-Future-Reliance imbroglio has been making headlines for a while now. The war-mongering between the giants is certainly only of the most high-profile corporate fights that the country has witnessed in recent times. But this is not the first time such disputes arise in history. Here’s a dossier for the curious and the concerned.
In late 2019, Amazon entered into a nearly Rs 2,000-crore deal with Kishore Biyani’s Future Retail (FR) acquiring 49 per cent stake in Future Coupons. Now, Future Coupons is a “promoter group entity of Future Retail” and holds 7.3 per cent stake in FR. The e-commerce giant also got a ‘call option’ to acquire all or part of Future Coupons’ shareholding in FR – which can be exercised between the third and the tenth year.
Things were all rosy until Reliance Retail (RR) entered the scene. In August 2020, the pandemic-squeezed Future Group agreed to sell a good chunk of its wholesale and retail business — Big Bazaar, premium unit Foodhall and Brand Factory to RR for a handsome Rs 24,000 crore. The Amazon deal, however, forbade Future Group from business transactions with some 30 entities which (of course) included RR.
Amazon quickly approached the Singapore International Arbitration Centre (SIAC), because its contract with FR said all disagreements would go to this international dispute resolution organisation. SIAC, in turn, ordered in favour of Amazon and froze FR’s attempts to dispose of its assets. FR then approached Indian courts and the matter remains with the Supreme Court as of now.
The case does remind one of the similar big-money tussles between corporate giants across the globe that drew much attention. Let’s take a look at a handful that created ripples.
Samsung-Apple patent war
From 2011 to 2018, the allegation that Samsung had copied the iPhone’s design, led the two to lock horns over a range of utility and design patents used in earlier models with Apple setting its foot down and seeking more than $2 billion in damages. The features allegedly copied included the grid display of icons on the phone’s screen. While that seems like a topic more fit for a tiff than a full-fledged legal war, tech companies are actually known to patent every possible advancement and innovation that they come up with so they have more control over its commercial aspects. Well, it’s not just the tech companies.
Take a look at this 2015 article on some design aspects Nike went all out to protect.
As the case went on, one judge’s remark stirred some interest when he went on record to say that Samsung’s design was nowhere as cool as that of Apple, and hence it could not have infringed on the California-based company’s design rights. Ouch!
In 2012, a US jury ruled in favour of Apple, ordering the South Korean company to pay $1.05 billion in damages. After several more years of wrangling, Samsung reportedly was to pay $539 million, when the two firms decided to settle the issue while refusing to disclose the terms under which they reached that settlement.
And a case Apple lost
In 2016, Nokia came out with the allegation that Apple infringed on several patents that belonged to it as well as to Nokia-owned companies NSN and Alcatel-Lucent. The patents ranged from those related to display to software as well as coding. In a sign that the altercation was going out of hand, Apple Inc withdrew Withings products — owned by Nokia — from its stores.
For reasons best known to both companies, they settled the issue before it stretched on for years with Apple paying $2 billion to Nokia and even going to the extent of paying the Finnish multinational a fee to collaborate with it on R&D.
Google’s sour ride with Uber
In 2017 Google accused ride-hailing giant Uber of having acquired a bunch of trade secrets of Waymo, the self-driving car unit of its parent company Alphabet Inc. Apparently, when Waymo engineer Anthony Levandowski left to found his own truck company Otto, he stole about 14,000 documents with proprietary information on the self-driving programme. During his last year, Google had paid Levandowski over $120 million for his contribution to the autonomous vehicle tech programme. Otto was later acquired by Uber.
The cat was out of the bag when a Waymo supplier’s mail accidentally indicated that Uber’s self-driving programme’s design bore a striking resemblance to that of Waymo. Eventually, Uber agreed to pay Alphabet nearly $245 million in equity and Levandowski, who was given a prison term of 18 months after he pleaded guilty, was pardoned by then US President Donald Trump right before he left office.
Facebook vs. Australia
After watching tech giants making money off news portals, Australia proposed a law to make internet biggies cough up some dough for news organisations instead of pocketing it all themselves. After all, they did use the content generated by news websites. But the government move seemed to have touched a raw nerve with Google threatening to shut its search engine in the country and Facebook even blacking out Australian news.
The demand set forth by the Australian government was a sign of a shift in power equations between web titans and the news industry which has seen dwindling revenue for years. Indeed, several governments are at the moment reassessing the grip of these gigantic corporations on their citizens.
Both FB and Google had to dial down their tone and eventually struck a deal with the Australian government promising to support newsrooms. Simultaneously, the Australian privacy regulator sued Facebook for sharing private details of over 3 lakh people with Cambridge Analytica without their permission. The government sought damages of 529 billion Australian dollars (US$343 billion) in the ongoing case.
In July 2019, the US Federal Trade Commission too had charged Facebook a fine of $5 billion for the same reason after a probe. Even the European Union had in 2017 penalised Google under its anti-trust rules and ordered a $2.7 billion fine for limiting the choices it gave to EU citizens to promote Google’s own shopping tools.
It’s not just the market impact of such mega litigations that attract eyeballs. The staggering amount of money involved as well as the suspense of who will have the last say or lobby their way out to emerge the winner is riveting enough.