England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION COMMERCIAL COURT
MR JUSTICE FLAUX
CASE NO 2007 FOLIO 1040

		Royal Courts of Justice Strand, London, WC2A 2LL
		09/05/2008

Lord Justice Lawrence Collins:

I Background

1. This is an appeal from a decision of Flaux J dated January 17, 2008 on some preliminary issues concerning the interpretation of three commercial agreements between the parties. It is not a case (by contrast with e.g. Chartbrook Ltd v Persimmon Homes Ltd [2008] EWCA Civ 183) in which either side suggests that there was such a consensus on the points in issue as to justify any exceptional resort to pre-contractual negotiations or as to justify a claim to rectification.
2. The case was most elaborately argued before the judge and before this court, with an attention to the linguistic detail of the agreements more appropriate to the interpretation of tax legislation which has received close scrutiny at all committee stages than to the interpretation of commercial contracts. The main points of interpretation on this appeal depend primarily on the ascertainment of the commercial purpose of the agreements in the light of the commercial and factual background. The main provisions involved are quoted below but all of the relevant provisions to which detailed reference was made are reproduced in an appendix.

The parties and the business

3. Satyam Computer Services, Ltd ("Satyam"), the appellant, is an Indian company. Satyam had a subsidiary called Satyam Enterprise Solutions Ltd ("Satyam Enterprise"), which was a party to two of the three agreements in issue in these proceedings. In 1999 Satyam Enterprise was merged with Satyam, which succeeded to all its rights and liabilities. Upaid Systems, Ltd ("Upaid"), the respondent, is a BVI company. It was formerly known as In Touch Technologies Holdings Ltd, and is the successor through merger of In Touch Technologies Ltd (which is referred to in two of the three agreements in issue as "ITTL"). For convenience I shall refer throughout to the parties to the agreements under their present names, Satyam and Upaid.
4. Upaid's business is the invention, development and provision of software technology and payment processing platforms and services. Satyam's business includes providing information technology services for the creation and development of software products in the telecommunications industry. Satyam employs skilled IT engineers. It is one of the largest such companies in the world and currently has some 50,000 employees.
5. In about 1996, Mr Simon Joyce and Mr Prafulla Gupta, the co-founders of Upaid, developed the idea of converting any telephone into a de facto pay-phone through the use of a pre-paid account associated with a caller personal identification number (PIN). In order to exploit the idea commercially, they decided to outsource the development of the computer based external platform and related software and identified Satyam as an entity which could carry out the software development work.

Assignment Agreement

6. The relationship between the parties was originally governed by a memorandum of understanding dated May 29, 1997. Satyam employees were involved in creating the core architecture and design of the external platform, thereby contributing to Upaid's inventions. In addition Satyam was carrying out the software product implementation work, which was an ongoing continuous process.
7. By June 1998, Upaid had decided to apply for a patent to the United States Patent and Trademark Office ("USPTO"). In order to do this, Upaid would have to demonstrate "unity of ownership" of the intellectual property rights in the inventions. It was therefore necessary to procure the transfer to Upaid of any rights in the inventions vested in Satyam, or in inventors working for Satyam. Satyam's practice is to transfer to its customers the intellectual property rights to the products it creates, but the memorandum of understanding dealt only briefly with the ownership of inventions and was silent as to any intellectual property rights.
8. Accordingly from late June 1998 there were negotiations for the formal documentation of a transfer to Upaid by Satyam of any intellectual property rights. The transfer was required for USPTO patent application filing purposes. Upaid wanted to file a provisional patent application with the USPTO by September 15, 1998, the date of a trade fair in Milan, to give it a "priority filing date" thereafter protecting it from infringement by commercial rivals. The Assignment Agreement was signed on September 11, 1998, and on September 15, 1998, Upaid filed a provisional patent application with the USPTO.
9. The Assignment Agreement was expressed to be governed by New York law (but without any jurisdiction clause) and contained (in paragraph 3) a covenant by Satyam that it would, on Upaid's request, provide Upaid

"… with all pertinent facts and documents relating to the applications, registrations, Letters Patent and legal equivalents in foreign countries as may be known and accessible to Satyam and will testify as to the same in any interference or litigation related thereto and will promptly execute and deliver to [Upaid] or its legal representatives any and all papers, instruments or affidavits required to apply for, obtain, maintain, issue and enforce the applications, Letters Patent and legal equivalents in foreign countries which may be necessary or desirable to carry out the purposes thereof . …"

Services Agreement

10. Upaid and Satyam also negotiated an agreement covering the parties' commercial relationship, which was required by the financiers with whom Upaid was dealing to raise funds via a private placement and which eventually became what is described as the "Services Agreement."
11. September 15, 1998 was the date of commencement of activities of the "In Touch dedicated centre" at Satyam, a dedicated unit working exclusively on Upaid projects. It was originally contemplated that the Services Agreement would be concluded by that date, but the negotiation of the Services Agreement took longer than anticipated and it was concluded on May 19, 1999.
12. The effective date of the Services Agreement was expressed to be September 15, 1998 (clause 1.3). It contained (clause 11.1) an agreement to assign intellectual property in the following terms:

"… If any portion of the work or services to performed by Satyam hereunder is not eligible to be considered a work for hire under the United States Copyright Act, then Satyam shall irrevocably and unconditionally assign and transfer to [Upaid], and Satyam does hereby irrevocably and unconditionally assign and transfer to [Upaid] all rights to the Intellectual Property relating to, arising in connection with or otherwise resulting from the Services, the Software Projects or resulting Software Products. Satyam further agrees to have its employees execute necessary instruments deemed by [Upaid] and/or its attorneys or representatives to be necessary to transfer such right, title or interest in the Intellectual Property to [Upaid]. Satyam shall take all necessary initiatives to protect such Intellectual Property rights. Accordingly, [Upaid] shall own all right, title and interest in and to the Intellectual Property Satyam agrees to execute and deliver to [Upaid] any and all assignments and other documents or instruments reasonably requested by [Upaid] in furtherance of filing and maintaining the applications relating to the Intellectual Property. …"

13. The Services Agreement was to be governed by Virginia law (clause 14.11: but without any jurisdiction clause), and it also contained an "entire agreement" clause (clause 14.16).

Patent applications

14. In order to maintain the priority filing date which such a provisional application achieves a full "utility" patent application had to be filed within 12 months of the provisional application. That application had to have filed with it a full set of documentation required by the USPTO to demonstrate in particular: (a) Upaid's unity of ownership in the inventions; (b) that all individual inventors had taken on their individual enduring duties of disclosure and candour to the USPTO, by way of a formal declaration under oath.
15. In December 1998, a complete set of blank assignments to be signed by Satyam "inventor" employees was sent by Upaid's general counsel to Satyam. Upaid alleges that on the weekend of August 28/29, 1999 Satyam sent to Upaid's general counsel at home in Washington a package of 72 executed employee assignments (purportedly completed by 36 employees, since they were in duplicate). 20 of the employees in question were "inventor" employees. All those employee assignments are dated July 7, 1999.
16. Considerable parts of the text of the employee assignments closely track the wording of the Assignment Agreement, and they contain a choice of New York law in terms identical to that in the Assignment Agreement.
17. On September 14, 1999 Upaid filed its formal utility application with the USPTO. Accompanying the application were the Assignment Agreement and the employee assignments, which together demonstrated Upaid's unity of ownership.
18. Thereafter, the USPTO gave notice that it had not received a declaration signed by all the inventors that they were each original, first and joint inventors and took on personal duties of disclosure and candour ("the Combined Declaration"). This request was passed to Satyam and Upaid alleges that on about November 4, 1999, it sent back a Combined Declaration with the signatures of the 20 inventor employees. The Combined Declaration was filed with the USPTO, which granted the patent ("the 947 patent") on November 20, 2001.
19. Subsequently, Upaid filed two "continuation in part" applications with the USPTO in respect of further inventive work, predicated upon the 947 patent. It has also used the 947 patent as the foundation for a number of other patents worldwide and contends that its entire patent portfolio is dependent upon the validity and enforceability of the 947 patent. In support of the first of those "continuation in part" applications filed in June 2001, employee assignments were provided by the various "inventor" employees of Satyam signed on various dates in late 2001. These assignments were in a different form from the earlier employee assignments and were assignments by the relevant employee to Upaid.

Settlement Agreement

20. By the beginning of 1999, Upaid owed Satyam about US$2 million. During the first half of 1999, there were discussions between the parties with a view to Satyam becoming a shareholder in Upaid and the existing debt being restructured by way of a debt to equity swap. A Share Issuance Agreement dated September 1, 1999 was entered into under which, inter alia, Satyam purchased 27.06% of Upaid's stock and undertook to invest US$2.5 million in Upaid and procure further investment of another US$5 million either directly or by third parties. Satyam was given the right to nominate a director to the Upaid Board.
21. By 2002 the relationship between the parties had deteriorated. A number of disputes had arisen. In particular: (a) Upaid had a complaint about the quality of the work being provided by Satyam under the Services Agreement not being up to the industry standard; (b) Satyam was complaining about non-payment by Upaid for work performed under the Services Agreement and claimed that Intellectual Property had reverted to Satyam under the terms of the Services Agreement; (c) Upaid was complaining about the behaviour of Satyam's representative on the Upaid Board, Mr Srini Raju, and whether or not he was acting in Upaid's best interests and Satyam had a cross-complaint that he was not being allowed to participate in all aspects of the Board discussions; (d) Upaid was complaining about Satyam's potential infringement of Upaid's Intellectual Property Rights through the M-Biz Platform which was being offered by a company set up by Mr Srini Raju.
22. At a meeting between the parties in Hyderabad on November 1, 2002 Upaid's representatives put forward its complaints. A desire to settle those disputes and to terminate the relationship between the parties led to the Settlement Agreement between the parties signed on and effective as of December 31, 2002.
23. The Settlement Agreement was expressed to be governed by English law, and provided for the exclusive jurisdiction of the English court for "any and all disputes arising out of or relating to" the Agreement (clause 4(c)). It provided (clause 2.2) that the Services Agreement was terminated with effect from August 31, 2002, and had "no further force or effect, notwithstanding any provisions to the contrary contained in the Services Agreement or in any other document, as to the survival of any provisions of the Services Agreement." There was a release (clause 2.3, accompanied by a covenant not to sue: clause 2.4) of any claims

"arising out of or relating in any way directly or indirectly to the Services Agreement including claims relating to representations, warranties, intellectual property rights, quality of services performed …"

24. By clause 3.1(b):

" …Further, Satyam confirms all assignments of intellectual property rights to Upaid by it and those assignments executed by Satyam employees as co-inventors of Upaid intellectual property and such assignments will survive and shall be governed by such Assignment agreements. .."

25. The Settlement Agreement also contained an entire agreement clause (clause 4(a)).

Texas proceedings

26. In June 2005, Upaid filed patent infringement proceedings in the Eastern District of Texas against Qualcomm Incorporated and Verizon Wireless on the grounds that those companies had developed software platforms and were offering network services in a manner which infringed Upaid's 947 patent and subsequent patents.
27. In their defence of those proceedings, the two companies produced declarations from two former Satyam employees, Mr. Mambakkam (who worked on the project between about June 1997 and May 1998) and Mr. Govindacharyula (who worked on the project between August 1997 and February 1998), that they had neither seen nor signed their respective employee assignments or the Combined Declaration. Upaid obtained the advice of a handwriting expert that the signatures on these documents were almost certainly forged. Mr Mambakkam had in fact sold his rights in the inventions to Verizon.
28. Upaid sought the assistance of Satyam in providing evidence and documentation relating to the forgery allegations. Such assistance was not immediately forthcoming and Upaid issued a subpoena against Satyam. Satyam was not able to produce any material or evidence capable of answering the allegations of forgery. Upaid alleges that it was as a consequence of the allegations of forgery that it was forced to settle the infringement proceedings on extremely unfavourable terms in April 2007.
29. On April 4, 2007 Upaid filed a Complaint against Satyam in the United States District Court for the Eastern District of Texas. An Amended Complaint (joining Mr Govindacharyula as a defendant) was filed on July 16, 2007. In those proceedings, Upaid alleges that faced with the evidence of the forged signatures of Mr Govindacharyula and Mr Mambakkam and the sale by Mr Mambakkam of his patent rights, Upaid "had no other choice but to settle [with Qualcomm and Verizon] on draconian terms", whereas otherwise "Upaid would have prevailed, through settlement or trial in their patent infringement action against Qualcomm and Verizon Wireless". The following relief is claimed: (a) a declaration as to the validity of the patents; (b) damages for Satyam's alleged fraud and/or forgery and/or misrepresentation in providing documents containing forged signatures; and (c) damages for Satyam's alleged breach in 1999 of the covenant contained in the third paragraph of the Assignment Agreement.
30. Satyam does not accept that it was responsible for any forgeries, and it is common ground that the preliminary issues should be determined on the basis that it is not known who was responsible for the forgeries. It was common ground at the hearing of the appeal that the judge should not be taken as having made any findings of fact to the effect that the employee assignments or the signed Combined Declaration were sent to Upaid by Satyam.

English proceedings

31. Satyam contends that these claims in Texas are being brought in breach of the terms of the Settlement Agreement, which compromised all such claims, alternatively that by virtue of the exclusive jurisdiction clause in the Settlement Agreement, all such claims have to be brought before the English courts.
32. These proceedings were commenced on June 18, 2007, and Upaid was served abroad after permission was granted by Tomlinson J. In June 2007, Satyam applied for an interlocutory injunction to restrain the continuation of the proceedings in Texas.
33. Upaid agreed not to pursue the proceedings in Texas pending the determination of these preliminary issues, the trial of which was ordered by Flaux J on September 11, 2007, and heard between December 17 and 20, 2007: (1) whether any (and if so which) of Upaid's claims in the Texas proceedings had been finally compromised by the Settlement Agreement effective as of December 31, 2002; (2) whether any (and if so which) of Upaid's claims fell within the scope of the English jurisdiction clause contained in the Settlement Agreement; and (3) whether Satyam was entitled to a final injunction restraining continuation of the Texas proceedings.

II The issues on the appeal

34. The judge decided the two main preliminary issues in favour of Upaid, and therefore that there was no basis for any injunction restraining continuation of the Texas proceedings.
35. The preliminary issues involved a number of sub-issues, and the principal issues decided by the judge and which are the subject of this appeal are these: (1) Whether the obligations in clause 11.1 of the Services Agreement superseded the obligations in paragraph 3 of the Assignment Agreement; (2) whether the third sentence of clause 3.1(b) of the Settlement Agreement preserved Upaid's rights under paragraph 3 of the Assignment Agreement; (3) whether the Settlement Agreement prevented Upaid from bringing damages claims for breach of paragraph 3 of the Assignment Agreement; (4) whether the Settlement Agreement prevented Upaid from bringing (a) unknown claims which arose after the date of the Settlement Agreement and/or (b) unknown claims involving an allegation of fraud against Satyam's employees; and (5) whether, if Upaid can still bring any of the claims against Satyam, such claims are within the scope of the English jurisdiction clause in the Settlement Agreement.

1. Was the Assignment Agreement superseded by the Services Agreement?

A Flaux J's judgment

36. The Services Agreement is governed by Virginia law, and the judge heard expert evidence. Satyam called Professor Robert Scott, and Upaid called Professor Kent Sinclair, each of whom had taught at the University of Virginia Law School for many years. There was not much difference between them, and the judge also found that there was little relevant difference between Virginia law and English law so far as the construction of contracts is concerned. On this appeal it has not been contended that there is any relevant difference.
37. The evidence of Virginia law was that where two written agreements were made contemporaneously (at the same time or close in time) so that they could be regarded as part of the same business transaction, they would be treated as part of one integrated transaction and read and construed together. The presence of an entire agreement clause in one of the agreements did not preclude the agreements being read together as part of a single transaction.
38. In light of the evidence that (i) the Assignment Agreement was being negotiated in June to September 1998 at the same time as the Services Agreement; and (ii) it was contemplated at the time that the Services Agreement would be completed and signed by September 15, 1998 and that it was only because completion took longer than anticipated that the Services Agreement was not signed until May/June 1999, the two agreements were contemporaneous for the purposes of the application of the principle of Virginia law, and were to be read together. Only if there were clear and convincing evidence that the Services Agreement was intended to supersede the Assignment Agreement would the court conclude in favour of supersession.
39. The judge found that the Assignment Agreement undoubtedly assigned the inventions and intellectual property rights which were the subject of the provisional patent application filed on that date and contained co-operation obligations upon Satyam which were intended to enable Upaid to protect those inventions and rights. It was not intended to be a temporary measure which would only take effect until the Services Agreement came into force: (a) it was contemplated that the Services Agreement would be effective from September 15, 1998, and the concept that an assignment effective only 4 days previously was only temporary would be somewhat unusual, unless it said in terms that it was only temporary; (b) the Assignment Agreement referred to assignment and transfer of the relevant intellectual property rights "in perpetuity, to endure from now until the end of time". The co-operation covenant in paragraph 3 of the Assignment Agreement was unlimited in time. The commercial purpose of paragraph 3 was to ensure that Satyam would co-operate with Upaid in protecting the Intellectual Property Rights assigned by the second paragraph, if necessary by providing evidence in patent protection or similar litigation. If those co-operation obligations (ostensibly temporally unlimited) in fact disappeared within a matter of days, that would be surprising, albeit that on Satyam's case they were substituted with the somewhat less stringent provision in clause 11.1 of the Services Agreement.
40. There was nothing in the terms of the Services Agreement which evidenced an intention that it should supersede the Assignment Agreement. It was effective from September 15, 1998, four days after the Assignment Agreement and was forward looking. In particular, the assignment and transfer effected by the second sentence of clause 11.1 clearly related only to intellectual property rights in respect of "work or services to [be] performed by Satyam hereunder," i.e. work or services to be performed under the Services Agreement after its effective date of September 15, 1998, which by definition could not include intellectual property rights already assigned pursuant to the Assignment Agreement and which did not need to be assigned again by the Services Agreement. That was confirmed by the words: "Satyam shall irrevocably and unconditionally assign and transfer to [Upaid], and Satyam does hereby irrevocably and unconditionally assign and transfer to [Upaid], all rights to the Intellectual Property relating to, arising in connection with or otherwise resulting from the Services, the Software Projects or resulting Software Products." The obligation to transfer in the future ("shall assign and transfer") and the acknowledgment of transfer "hereby" i.e. by the Services Agreement was not consistent with that transfer or assignment having already taken place pursuant to the Assignment Agreement, and was consistent with the transfer and assignment being of intellectual property rights as at September 15, 1998 to the extent not already transferred and assigned by the earlier Assignment Agreement, together with an undertaking to transfer and assign future rights as they arose.
41. The fundamental point that the assignment under clause 11.1 of the Services Agreement was of work to be performed on and after the effective date was reinforced by other provisions of the Services Agreement referred to in that clause: the definitions of "Services", "Software Projects" and "Software Products" were all looking forward to the services to be performed in the future under the Services Agreement. That conclusion was not affected by the definition of "Intellectual Property" in clause 1.4, because that clause did not stand in isolation and the clause which dealt with Intellectual Property Rights, namely clause 11.1, was clearly forward looking. The rights assigned by the Assignment Agreement clearly related to work and services performed by Satyam before September 11, 1998, otherwise there would have been nothing capable of assignment and transfer under the Assignment Agreement at that date. There was therefore no overlap between the intellectual property rights protected by the Assignment Agreement and those protected by clause 11.1 of the Services Agreement and the subject matter of the two provisions, although similar, was different.
42. Consequently since the subject matter of the two agreements was different the entire agreement clause (clause 14.16) did not have the effect of superseding the Assignment Agreement.
43. Nor was there any commercial absurdity and unreasonableness in having two "parallel" co-operation regimes, one under paragraph 3 of the Assignment Agreement and the other under clause 11.1 of the Services Agreement, even if the 947 patent included claims for inventive work which was not performed or created until after September 15, 1998. It would not necessarily be difficult to determine which co-operation regime applied to particular inventive work and intellectual property rights. The provisional application undoubtedly related to inventions and intellectual property rights which were assigned by the Assignment Agreement. The co-operation provided by Satyam in 1999 prior to the utility application (specifically the "employee assignments" the wording of which closely reflected that of the Assignment Agreement) was being provided pursuant to the third paragraph of the Assignment Agreement. To the extent that the patent involved work performed after September 15, 1998, Satyam had no difficulty in identifying such work. The differences between the two co-operation regimes were not particularly significant. Although the obligation in clause 11.1 to execute and deliver to Upaid any assignments and other documents or instruments reasonably requested in furtherance of filing and maintaining applications relating to the Intellectual Property was not so closely defined as that in the second part of paragraph 3 of the Assignment Agreement, it was essentially the same obligation. Even if there were differences in the co-operation regimes, it did not follow that their parallel operation was so unreasonable that it could not be what the parties intended.

B Satyam's arguments on the appeal

44. Satyam's arguments were the subject of an extensive skeleton argument, and an attractive argument by Mr Geoffrey Vos QC, and an equally attractive argument in response by Mr David Foxton QC. The main points were these.

Factual matrix

45. The first point was that the judge gave insufficient weight to the factual matrix, in particular that the software development project was continuing, with no watershed at September 15, 1998, and gave insufficient weight to points which emerged from the text of the agreements.

Governing law

46. Second, the Assignment Agreement was governed by New York law and the Services Agreement was governed by Virginia law, and it would be odd if continuing (and overlapping) obligations in relation to the same project were governed by different laws.

Not contemporaneous

47. Third, the effective date of the Assignment Agreement was January 1, 1998 and that of the Services Agreement was September 15, 1998. Consequently they were not contemporaneous, and there was no reason why they should be read together.

Overlap

48. Fourth, on Upaid's construction there would be an unnecessary and illogical overlap between the two agreements. The definition of "Intellectual Property" in clause 1.4 of the Services Agreement included intellectual property existing both before and after September 15, 1998 (as the judge accepted). "Intellectual property" included Software as defined in clause 1.8 of the Services Agreement. The combination of the definition of "Software" in clause 1.8, and Annexure 3 was that Software included or meant Call Manager and Net Manager, and consequently included software developed before September 15, 1998. This meant all the intellectual property in Call Manager and Net Manager. The definition permeated clause 11.1 of the Services Agreement.
49. The provision in clause 10.3 of the Services Agreement for reversion of rights to Satyam in the event of non-payment by Upaid would make no sense unless it applied to all rights in Call Manager and Net Manager, whether before or after September 15, 1998.
50. The employee assignments were only required by clause 11.1 of the Services Agreement, and were not required by the Assignment Agreement. Clause 11.1 was both forward and backward looking. It applied to intellectual property developed before September 15, 1998, and therefore replaced paragraph 3 of the Assignment Agreement. In particular it referred to software developed by "Satyam, Satyam's employees and the Dedicated Team." Since the Dedicated Team was not established until September 15, 1998 these words show that it applied to software developed before that date.
51. So also the warranty in clause 13.1(iii) shows that the Services Agreement was both forward and backward looking. Satyam warranted that the Software "was" created solely by full-time employees during the course of their employment with Satyam who "have" assigned all rights title and interest in their work relating to the Intellectual Property to Satyam.

Entire Agreement clause

52. Fifth, the Entire Agreement clause (clause 14.16) of the Services Agreement had the effect of precluding reliance on the Assignment Agreement. The clause was a negotiated provision, and covered the subject matter of the Services Agreement, which included the obligations in the Assignment Agreement, and made it clear that the Assignment Agreement was superseded. The subject matter of the Services Agreement was the software (Call Manager and Net Manager) and that was the same as the subject matter of the Assignment Agreement. Clause 14.16 made it clear that it was the promises in the Assignment Agreement which were superseded, namely the supporting obligations in paragraph 3 (and not the actual assignment).

Commercial situation

53. Mr Vos QC accepted on the appeal that continuance in parallel of the two agreements would not have been a commercial absurdity, but it would be commercially difficult and commercially surprising to have two regimes supporting the assignments. That made it unlikely that the parties intended them both to apply.

C Conclusions

54. The first question is whether there is any express provision which may have the effect of regulating the relationship between the Assignment Agreement and the Services Agreement. The only candidate is clause 14.16 of the Services Agreement:

"14.16 Entire Agreement

This Agreement together with its Annexures set forth and shall constitute the entire Agreement between [Upaid] and Satyam with respect to the subject hereof, and shall supersede any and all agreements, understandings, promises and representations made by one party to the other concerning this subject matter herein and the terms and conditions applicable hereto. Also, in case of any inconsistency between the documents constituting the Entire Agreement, this Agreement together with its Annexures would supersede all other documents."

55. I accept Mr Vos QC's submission that the court should not approach this provision with the pre-conceived idea that its sole intention is to ensure that the parties cannot subsequently contradict the wording of the agreement by reference to agreements or understandings supposedly arrived at in the course of negotiations (which is undoubtedly normally the main object of such clauses).
56. But I agree with the judge that Satyam's reliance on the Entire Agreement clause is circular since it applies to supersede prior agreements "concerning this subject matter herein and the terms and conditions applicable hereto," and "all other documents" inconsistent with "the documents constituting the Entire Agreement" (namely the Services Agreement and its Annexures). The question still remains whether the subject matter of the Assignment Agreement is included within the Services Agreement or whether it is inconsistent with the Services Agreement in any material respect.
57. I can see no flaw in the judge's reasoning on this issue. I would accept that the two agreements do not sit fully together. There is no identifiable purpose in having the Assignment Agreement governed by New York law, and the Services Agreement governed by Virginia law, and there is undoubtedly some potential overlap between paragraph 3 of the Assignment Agreement and clause 11.1 of the Services Agreement. I also accept that the definition of Intellectual Property in clause 1.4 of the Services Agreement goes beyond the intellectual property comprised in the "Software, Software projects, Software Products" (which are all defined by reference to the product of the Dedicated Team).
58. But if the matter is looked at both in broad commercial terms and by reference to the language of the two agreements, it is apparent that the subject matter is different. In particular I accept the argument for Upaid by Mr David Foxton QC that the key to the relative spheres of the two agreements is the divide at September 15, 1998, by which time the Provisional Patent Application provided a priority date. The intellectual property in the 947 patent was that assigned by the Assignment Agreement.
59. The choice of September 15, 1998 as the effective date for the Services Agreement was significant. The Services Agreement was to establish a new way of working with a Dedicated Team assembled in the Intouch Dedicated Center who would work solely on Upaid's account with a new regime covering remuneration and also addressing the Intellectual Property generated by the Dedicated Team. The InTouch Dedicated Center and the Dedicated Team operated only from September 15, 1998.
60. There are many provisions in the Services Agreement which indicate that it was forward looking from September 15, 1998, i.e. that it was intended to deal with the relationship of the parties as from that date. The recitals indicate that the object of the Services Agreement is to provide the terms and conditions upon which Upaid "shall" engage Satyam (third recital). The definitions of Services, Software, Software Products and Software Projects in clauses 1.7, 1.8, 1.9 and 1.10 are directed to the work of the Dedicated Team. I do not consider that there is anything in Annexure 3 (which is essentially a blank form) which affects that conclusion. I accept Mr Foxton's submission that the form in the annexure is a proforma or template for the future.
61. The provisions in clause 2 as to the scope of the Agreement look to the future, namely to what Satyam "shall provide" (clause 2.1), to how the InTouch Dedicated Center "shall operate" (clause 2.2) what the size of the Dedicated Team "shall be" (clause 2.3). The substantive obligations in clauses 3 to 8 also deal with the position following the Effective Date. Clauses 3, 4, and 5 deal with the InTouch Dedicated Center planning, resource management, and infrastructure. Clauses 6 and 7 deal with project start-up and execution. Clause 8 deals with management review of the InTouch Dedicated Center.
62. Clause 10.3 provides that if Upaid fails to make payments, "the rights set out in section 11.1 below shall revert to Satyam" until outstanding payments are received. In one sense it is logical for these rights to be limited to those acquired pursuant to the Services Agreement. The clause is intended to relate to payment for Services (as defined in clause 1.7), and it would make sense for there to be a reversion of rights deriving from the work of the Dedicated Team under the Services Agreement. But I would accept that here there is scope for some overlap because of the wide definition of Intellectual Property in clause 1.4 of the Services Agreement. But it does not follow from that one possibility that the two agreements have the same subject matter.
63. Clause 11.1 relates to Intellectual Property produced as a result of the work of the Dedicated Team ("relating to, arising in connection with or otherwise resulting from such work and services"). I accept Mr Foxton's submission that the inclusion of "Satyam and Satyam's employees" in addition to "the Dedicated Team" is minor surplusage of limited weight compared with the other strong pointers in the definitions, and that clause 11.1 is concerned only with the fruits of the work under the Services Agreement. The second sentence operates "if any portion of the work or services to [be] performed by Satyam hereunder" does not fulfil the conditions stated there, and what follows is concerned with the fruits of work or services performed "hereunder". That is what was assigned, and the co-operation obligations relate to the Intellectual Property rights which are assigned pursuant to clause 11.1.
64. So also the warranties in clause 13.1 relate to services provided "under this Agreement" and to the Software as defined, which is software resulting from the work of the Dedicated Team (clause 1.8).
65. Consequently in my judgment, despite some drafting infelicities in the Services Agreement, it does not supersede the Assignment Agreement.

2. Whether the third sentence of clause 3.1(b) of the Settlement Agreement preserved Upaid's rights under paragraph 3 of the Assignment Agreement

66. The third sentence of clause 3.1(b) of the Settlement Agreement is as follows:

"Further, Satyam confirms all assignments of intellectual property rights to Upaid by it and those assignments executed by Satyam employees as co-inventors of Upaid intellectual property and such assignments will survive and shall be governed by such Assignment agreements."

67. Flaux J decided that the third sentence of clause 3.1(b) on its true construction made it clear that the Assignment Agreement continued in full force and effect after the Settlement Agreement. He rejected Satyam's argument that the third sentence of clause 3.1(b) was only designed to ensure that previous transfers of intellectual property rights remained valid and binding even after the termination of the relationship. That might be arguable if the words "such assignments will survive" stood alone but they did not. The argument did not give any sensible meaning and effect to the words "shall be governed by such Assignment agreements". All the terms of the Assignment Agreement were covered by this phrase. That was the natural meaning of the words "shall be governed by such Assignment agreements" and it made commercial sense. An important aspect of protection of any intellectual property rights was the obligation of co-operation imposed on Satyam by paragraph 3 of the Assignment Agreement. The third sentence was also dealing with the "employee assignments", which also contained co-operation obligations.
68. The judge also rejected Satyam's argument that the Entire Agreement clause (clause 4(a)) in the Settlement Agreement supported its construction of clause 3.1(b) and demonstrated that paragraph 3 of the Assignment Agreement had been superseded by the Settlement Agreement. The judge found that the specific saving language of clause 3.1(b) clearly prevailed over the general words of clause 4(a). The effect of clause 4(a) was not to supersede the Assignment Agreement. The Assignment Agreement was not the "subject matter" of the Settlement Agreement, but was expressly preserved in full by its terms.
69. On this appeal Satyam says that the purpose of clause 3.1(a) was to make it clear that Satyam agreed that all Intellectual Property as defined in the Services Agreement (i.e. all intellectual property relating to the project) belonged to Upaid. Because clause 3.1(a) was the governing provision in clause 3, it is clear that the third sentence of clause 3.1(b) was to support the once and for all assignment. Consequently it confirms the actual assignments of the intellectual property, but not the supporting obligations. That construction is supported by clause 3.1(b) (last sentence), which provides that costs if any arising from Satyam or its employees complying with the requests of Upaid under clause 3.1(b) shall be paid by Upaid. This is not in the same terms as the costs provision of the Assignment Agreement, and indicates that the Settlement Agreement was intended to be comprehensive. It would have been bizarre for the parties deliberately to sweep away the co-operation obligations under the Services Agreement, but expressly preserve those under the Assignment Agreement.
70. My conclusion on this short point is that the object of clause 3.1 was to ensure that Upaid retained all relevant intellectual property, and clause 3.1(b) is not limited to confirmation of past assignments in the sense of transfers of property. The relevant term is "will survive and shall be governed" and I am satisfied that that means that the assignments will continue to apply in accordance with their terms.

3. Whether the Settlement Agreement prevented Upaid from bringing damages claims for breach of paragraph 3 of the Assignment Agreement

71. Satyam's first argument before Flaux J was that, even if the Assignment Agreement was not superseded by the Services Agreement, the claims which underlay the complaint in Texas had been compromised by the release and covenant not to sue in clauses 2.3 and 2.4 of the Settlement Agreement. Clause 2.3 applied to claims "arising out of or relating in any way directly or indirectly to the Services Agreement" and clause 2.4 applied to claims "in respect of or relating in any way directly or indirectly to the Services Agreement." Satyam argued that the claims in Texas were claims "arising out of" or "in respect of" or "or relating in any way directly or indirectly to the Services Agreement". The judge rejected the argument. The Assignment Agreement was not superseded by the Services Agreement and the subject matter of the two agreements was not the same. The claim for damages for breach of the Assignment Agreement arose out of that Agreement, and not out of the Services Agreement, whether directly or indirectly. The claims for damages for fraud and for a declaration could be said to arise indirectly out of the Assignment Agreement, but not out of the Services Agreement.
72. Satyam's argument that if the Assignment Agreement was preserved by and to be read alongside the Services Agreement, the claims in Texas arose indirectly out of the Services Agreement imported an impossibly wide and loose connection between the claims and the Services Agreement: Arbuthnott v Fagan [1996] L.R.L.R. 135 at 141. The purpose of the Settlement Agreement was to settle the disputes between the parties which had arisen under the Services Agreement and the Share Issuance Agreement and terminate the relationship. Its purpose was not to settle disputes under the Assignment Agreement, not just because there were no such disputes at that stage but also because that would be inconsistent with the survival and continuance of the Assignment Agreement contemplated by clause 3.1(b). Against the commercial background to the Settlement Agreement, it was impossible to say that claims which arose out of or were connected with the Assignment Agreement arose "indirectly" out of the Services Agreement merely because the two agreements were entered at around the same time and operated in parallel, at least as far as intellectual property rights were concerned.
73. Satyam's second argument before Flaux J was that because the employee assignments (of which complaint was made that two were forged) were produced pursuant to the Services Agreement, any claim relating to them arises out of the Services Agreement. The judge rejected that argument on the basis that in fact they were produced pursuant to paragraph 3 of the Assignment Agreement (as "papers" or "instruments" required to be executed and delivered for the purpose of applying for and maintaining an application for a patent) and tracked its terms. They were sent by Upaid to Satyam in blank form in December 1998, at a time when the Services Agreement was still in draft and not finally agreed. Clause 11.1 of the Services Agreement provided that Satyam would get its employees to execute assignments to transfer intellectual property rights to Upaid, i.e. direct assignments from the inventor employees to Upaid. There were such assignments in late 2001 in relation to the continuation in part application, but those were different from the employee assignments which were to Satyam, in order to perfect its assignment to Upaid.
74. On this appeal Satyam argues, first, that even if the Services Agreement did not supersede the Assignment Agreement, the effect of clauses 2.3 and 2.4 was to preclude claims arising out of the Assignment Agreement, because they "relate" to the Services Agreement. This would be particularly so if the judge were right that the Services Agreement and the Assignment Agreement were to be read together. The parties were dealing with a single relationship, and established a new regime for co-operation obligations. There was no reason for the parties to exclude potential claims under the Assignment Agreement. The recitals of the Settlement Agreement make it clear that it was to be "in full and final settlement of the Parties' various rights, obligations and contentions…"
75. Second, the employee assignments were given under the Services Agreement and the breach alleged is a breach of the Services Agreement (and is therefore covered by clauses 2.3 and 2.4). The employee assignments related to work completed before and after September 15, 1998. They also supported a continuation in part application, which related to work carried out after September 15, 1998. It is not clear that the employee assignments provided were required by the Assignment Agreement but it is clear that they were required by the Services Agreement. The language of paragraph 3 of the Assignment Agreement does not support the obligation to provide employee assignments. It simply provides that Satyam shall "execute and deliver" the documents, whereas the Services Agreement (clause 11.1) requires Satyam to have its employees execute the assignments. The language of the Assignment Agreement is tracked in the employee assignments only because Upaid's lawyers drafted both documents, and it does not follow that the employee assignments were provided pursuant to the Assignment Agreement.
76. The construction point is a short one, and I agree with the judge. I accept Mr Foxton's submission that it is plain (and common ground) that in commercial terms intellectual property was very important to the parties and was treated separately in the Settlement Agreement. Since the Assignment Agreement was concerned exclusively with intellectual property it made commercial sense not to include it within the releases.
77. I also agree with the judge that any claims based on the forged employee assignments are not covered by the release and covenant not to sue. They were provided pursuant to the Assignment Agreement. The references to the provisional patent application in the employee assignments show that they relate only to intellectual property generated prior to September 15, 1998. The employees whose signatures are alleged to have been forged only worked for Satyam prior to the signature of the Assignment Agreement. The employees who were identified in September 1998 as being required to make assignments all provided employee assignments. The process of getting these assignments was in motion at least from December 1998.
78. The clear purpose of the employee assignments was to establish the prior link in the chain of title, and they track much of the language in the Assignment Agreement and are expressed (as is the Assignment Agreement) to be governed by New York law.

4. Whether the Settlement Agreement prevented Upaid from bringing (a) unknown claims which arose after the date of the Settlement Agreement and/or (b) unknown claims involving an allegation of fraud against Satyam's employees.

79. This question only arises if the claims are caught by the language of the release and covenant not to sue in the Settlement Agreement. Bank of Credit and Commerce International (in liquidation) v Ali [2001] UKHL 8, [2002] 1 AC 251 was a case involving claims ("stigma claims" – claims by employees in respect of disadvantage on the labour market) which were unknown at the time of the release. It was held that there were no special rules of interpretation applicable to a general release, which was to be construed in the same way as any other contract. The question was what the intention of the parties was, construed objectively in the context of the circumstances in which the release had been entered into: at [8]-[10], [19] per Lord Bingham, [26] per Lord Nicholls. It was held by a majority (Lord Hoffmann dissenting) that the general release was not intended to cover such claims.
80. The decision was not concerned with claims based on fraud, but it was considered in the context of fraud-based claims in MAN Neufahrzeuge AG v Ernst & Young [2005] EWHC 2347 (Comm), affd on other aspects sub nom MAN Neufahrzeuge AG v Freightliner Ltd [2007] EWCA Civ 910. In that case the release related expressly to future claims, and the question was whether it applied to claims based on fraud. Moore-Bick LJ (as he had become) expressed the view (obiter, because the point did not in fact arise) that the release did not apply to claims based on fraud because neither party had the possibility of fraud in mind, and fraud was a thing apart because parties contract with one another in the expectation of honest dealing: at [209], citing HIH Casualty & General Insurance v Chase Manhattan Bank [2001] EWCA Civ 1250, [2001] 2 Lloyd's Rep 483, at [155] (a case on exclusion clauses).
81. Flaux J applied these decisions, and took the view that the wording of clauses 2.3 and 2.4 of the Settlement Agreement, drafted with the particular disputes between the parties which were then outstanding in mind (which by definition did not include an unknown future dispute about intellectual property rights), should not be construed as depriving Upaid of those future rights to claim damages for breach of the Assignment Agreement or for alleged fraud in relation to documentation produced pursuant to the third paragraph of that Agreement. He held that it would only be through the use of the clearest possible specific language that parties to a settlement agreement would be taken to have excluded fraud-based claims. The principle extended to causes of action of which dishonesty was not a necessary ingredient but which had been committed dishonestly.
82. Where the claims in question were based on fraud or involved allegations of dishonesty, very clear and specific language in a settlement agreement was required to settle such claims or exclude their subsequent pursuit, a fortiori if they were unknown at the time that the settlement agreement was entered into. The claims in Texas (whether ultimately they proved well-founded or not) involved allegations of fraud and forgery against Satyam. The wording of clauses 2.3 and 2.4 of the Settlement Agreement, even if otherwise capable of applying to claims arising under the Assignment Agreement, was not sufficiently clear or specific to exclude those claims.
83. Satyam's argument is that unknown claims (and claims based on the fraud of employees) may be compromised by clear words, and that the words in clause 4 were clear and forward-looking. Exclusion clauses are construed narrowly and the judge (as was Moore-Bick LJ in MAN Neufahrzeuge AG v Ernst & Young) was wrong to apply HIH v Chase Manhattan Bank to releases. It must have been intended to compromise unknown claims and fraud-based claims because this was a termination of the whole relationship (supported by the destruction of documents provision in clause 2.6). The release of vicarious liability for fraud accords entirely with fair, sensible commercial practice.
84. I do not accept this submission. I would agree that the exclusion clause cases should not be automatically imported into the area of releases, but that is not what either Moore-Bick LJ did in MAN Neufahrzeuge AG v Ernst & Young, or what Flaux J did in the present case. Lord Bingham said Bank of Credit and Commerce International (in liquidation) v Ali (at [10]) that "a long and … salutary line of authority shows that, in the absence of clear language, the court will be very slow to infer that a party intended to surrender rights and claims of which he was unaware and could not have been aware." Lord Browne-Wilkinson agreed, and Lord Clyde (at [86]) expressed substantially the same view. It seems to me to be clear that the same principle must apply to fraud-based claims. If a party seeking a release asked the other party to confirm that it would apply to claims based on fraud, it would not, in most cases, be difficult to anticipate the answer.
85. It is not, I think, very helpful to consider whether the release/covenant not to sue applies in the abstract to unknown claims, and then separately whether it applies to fraud-based claims. The true question is whether on its proper construction it applies to claims of the type made in the Texas proceedings, namely that, unknown to Upaid when the Settlement Agreement was entered into, Upaid was supplied by Satyam with forged assignments. To that question it seems to me that there is only one possible answer. In my judgment, express words would be necessary for such a release. The provision in clause 2.6 for destruction of documents does not assist. It was plainly designed to deal with Upaid's confidential information, and does not support the argument that the Agreement was designed to draw a line under all possible claims. If it were necessary to decide separately whether the release/covenant not to sue applied to (a) unknown claims, and (b) fraud-based claims, I would have come to the same conclusion as the judge.
86. For the sake of completeness I should refer to Upaid's alternative argument that if Satyam was aware when the Settlement Agreement was entered into that some of the employee assignments contained forged signatures, it would be unconscionable for Satyam to be able to rely upon clauses 2.3 and 2.4 as having compromised all claims including those in the future arising as a consequence of such forgery.
87. In Bank of Credit and Commerce International (in liquidation) v Ali Lord Nicholls (at [32]) said that if one party knew (but the other did not) that the latter had or might have a claim, the law would be defective if it did not provide a remedy for such unacceptable sharp practice. The judge did not decide the point because the underlying allegation of sharp practice was a very serious one which would require to be specifically pleaded and proved. It was wholly inappropriate to proceed on "assumed facts" in relation to such a serious allegation, and it would be unfair to Upaid to shut it out from arguing sharp practice, by deciding the point on limited materials at the present stage. On this appeal Satyam accepted that if Upaid had a factual basis for such a "sharp practice" contention, Upaid could claim to have the Settlement Agreement set aside for fraud, but said that such a claim would be within the scope of the English jurisdiction clause.

5. Whether, if Upaid can still bring any of the claims against Satyam, such claims are within the scope of the English jurisdiction clause in the Settlement Agreement

88. Clause 4(c) of the Settlement Agreement provided that: "Any and all disputes arising out of or relating to this Agreement shall be brought in a court of competent jurisdiction in London, England."
89. Satyam's argument was that, in any event, the Texas claims had to be litigated in England. The basis of the argument was that the claims arose out of or related to the Settlement Agreement because (on this hypothesis) they arose out of or related to the Assignment Agreement which was preserved by the Settlement Agreement, and the court should adopt the approach to arbitration clauses in Fiona Trust v Privalov [2007] EWCA Civ 20, [2007] 2 Lloyd's Rep 267 (CA); affd sub nom Premium Nafta Products v Fili Shipping Company [2007] UKHL 40, [2007] 4 All ER 951: "…. The construction of an arbitration clause should start from the assumption that the parties, as rational businessmen, are likely to have intended any dispute arising out of the relationship into which they have entered or purported to enter to be decided by the same tribunal" (at [13] per Lord Hoffmann).
90. Flaux J took the view that such an approach, far from giving effect to the parties' intentions and bargain, would frustrate them. The Assignment Agreement was governed by New York law and did not contain any jurisdiction clause. To import into it an English jurisdiction clause would be inconsistent with the terms of Clause 3.1(b) of the Settlement Agreement which provided that the assignment should be governed by the Assignment Agreement.
91. On appeal, Satyam argues that the jurisdiction provisions should be construed widely in favour of one-stop litigation. The expression "any and all disputes arising out of or relating to this Agreement" should be construed broadly to give effect to the commercial intention. Clause 4(a) (the Entire Agreement clause) made that clear in bringing all previous agreements into the context of the compromise. If the Assignment Agreement was preserved by the Settlement Agreement, then the Texas claims arise out of or relate to the Settlement Agreement and are equally caught by the jurisdiction clause. The justice of the case is that even if fraud claims are not within the scope of the compromise, they should be litigated in England.
92. It has not been suggested (apart from the jurisdiction clause argument) that Texas is not an appropriate forum, nor that England is an appropriate forum. The court was told that Satyam has five regional offices in the United States. There is, of course, an issue as to who produced the alleged forgeries. The principal question will be by whom, and where, they were produced, but on any view they were supplied in Washington DC for the use of USPTO.
93. I consider that the judge was plainly right. I do not consider that Premium Nafta Products v Fili Shipping Company is of assistance. Plainly it makes commercial sense for a dispute about the validity of the contract to be determined under an arbitration agreement (or a jurisdiction agreement). Whether a dispute under a different contract is within a jurisdiction agreement depends on the intention of the parties as revealed by the agreement. The effect of clause 3.1(b) is that any claims under the Assignment Agreement are governed by that agreement and not by the Settlement Agreement. Claims under an agreement preserved by the Settlement Agreement do not "relate" to the Settlement Agreement.

III Disposition

94. I would therefore dismiss the appeal.

Lord Justice Rimer:

95. I agree.

Lord Justice Waller:

96. I also agree.
Appendix

A Assignment Agreement

...

This Assignment is effective as of 1 January 1998 ("Effective Date") and is by and between Satyam Enterprise Solutions, a company registered in India, with an address at 'Mayfair Centre' Sardar Patel Road, Secunderabad 500 003, India, and IN TOUCH Technologies, Limited ("ITTL"), a corporation of the British Virgin Islands, with an address at 8231 CR 500, Pagosa Springs, Colorado 81147, United States of America. Satyam has contractually developed, as works for hire, certain computer software entitled CallManager (comprising SwitchManager and CardManager) and NetManager which is described in the specification and representative portions of the source code thereof attached hereto as Exhibit A ("the Software"). ITTL desires to clarify its ownership of all worldwide right, title and interest in and to the Software, both object and source code and documentation for the code and any mask, works of or for the Software, and all worldwide copyright, patent, trade secrets relating thereto and all other worldwide intellectual property rights therein, including trademark and trade dress pertaining to the Software (the "Intellectual Property Rights").

For good and valuable consideration paid, the receipt and sufficiency of which are hereby acknowledged, Satyam does hereby assign and transfer to ITTL in perpetuity, to endure from now until the end of time, all worldwide right, title and interest in and to the Software, and the Intellectual Property Rights in and to the Software including without limitation (1) all computer code, including object and source code and all documentation thereto and any mask works of or for the Software, (2) all copyright in and to the Software in all media now known or developed in the future, (3) all copyright applications and registrations and the right to seek and hold copyright registration or registrations and comparable rights in all countries throughout the world, (4) the right to seek patent protection and to own all patent applications and Letters Patent or similar legal protection for the Software in all countries throughout the world, including any continuation, division, continuation-in-part, re-examination, renewal, substitute, extension or reissue thereof or any legal equivalent thereof in a foreign country for the full term or terms for which the same may be granted, (5) all trademark applications and registrations in connection therewith, the right to seek trademark registrations and comparable rights in all countries throughout the world, and the good will appertaining to the trademarks and (6) all trade secrets in the Software. Satyam further authorizes and requests the Register of Copyrights of the United States and the Commissioner of Patents and Trademarks of the United States and any officials of any foreign country whose duty it is to issue copyright registrations, patents, trademark registrations or legal equivalents thereto to issue the same for or in connection with the Software to ITTL, its lawful successors and assigns.

Satyam further covenants that Satyam will, upon ITTL's request, provide ITTL with all pertinent facts and documents relating to the applications, registrations, Letters Patent and legal equivalents in foreign countries as may be known and accessible to Satyam and will testify as to the same in any interference or litigation related thereto and will promptly execute and deliver to ITTL or its legal representatives any and all papers, instruments or affidavits required to apply for, obtain, maintain, issue and enforce the applications, Letters Patent and legal equivalents in foreign countries which may be necessary or desirable to carry out the purposes thereof. All costs/expenses on this account will be borne by ITTL. In case Satyam incurs any expenditure on this account, the same shall be reimbursed by ITTL.

This Assignment shall not lapse if the rights assigned to ITTL are not exercised within a period of one year from the Effective Date. This Assignment and the relationship of the parties shall be governed by the laws of New York without reference to conflicts of laws principles. This Assignment supersedes any assignment(s) of the Software from Satyam to ITTL executed prior to the dates(s) of execution of this Assignment."

B Services Agreement

…

WHEREAS, ITTL and Satyam desire to enter into this Agreement to provide the terms and conditions upon which ITTL shall engage Satyam on a mutually non-exclusive basis to provide research and development services for software and system integration projects related to software products for global use in, but not limited to, the telecommunication industry, as set forth in Annexures 2-7 hereto, for use by ITTL and its Affiliates.

…

1 DEFINITIONS

…

1.2 "Dedicated Team"

Dedicated Team shall mean a team of Satyam employees that shall work exclusively on ITTL projects and shall predominantly consist of software professionals team with skills necessary for providing the Services.

1.3 "Effective Date of this Agreement"

Effective date of this Agreement shall be the 15^th day of September 1998.

1.4 "Intellectual Property"

Intellectual Property shall mean any inventions, discoveries, devices, apparatus, technology of processes, methods, know-how, trade secrets, improvements or other intellectual property rights, including any copyright, patent, patent applications, trademarks, service marks to all Software, Software Projects, Software Products, documentation and equipment, analytical methods, procedures and techniques and computer technical expertise generated by, derived from or used in connection with the Software Products.

1.7 "Services"

Services shall mean the services provided by the Dedicated Team for researching and developing Software Products and Software Projects that include the following:

(i) Product Management – shall include technology planning and market directions; market research and data collection; market feedback for enhancements to existing products; opportunity funnel management; opportunity identification and populating opportunity funnel; opportunity analysis and risk assessment; product specification; feature list for product concepts; platform selection for product concepts; marketing and sales support; marketing communication for products under software development; demonstration of products to prospective customers; facilitating creation of product development environment at IDC; determining product development environment including hardware and networking platform; software development environment; standards and architectures; and vendor identification and evaluation; and shipment co-ordination with ITTL;

(ii) Product Engineering – shall include product development; translating product concepts into specifications; design development; unit/module/integration testing; configuration management; product enhancement and maintenance; new version release management; integration of market feedback from Product Management for product enhancements; integration of customer feedback from product support for product enhancements; product maintenance; fixing identified bugs in the software; and inputs from customer base for product enhancements; ensuring optimum resource utilization and day to day monitoring of projects;

(iii) Professional Services – shall include pre-implementation services; deployment estimates; deployment configurations; business mapping and product positioning; integration with Product Engineering team for customisation; facilitate base-line set-up; identification of base-line set-up components including hardware, networking, databases and software deployment environments; identification and evaluation of vendors for above set-up components; implementation; training; production support; managed operation; product support; and telephonic support to customer base of products; and

(iv) Program Management – shall include the direction setting and planning for IDC; approval for project start-up; acceptance for project deliverables; resource planning and utilization; and infrastructure (computing and communication) planning and provisioning provided by ITTL, definition and documentation of the key work practices and procedures to be followed by the IDC, management of change requests for all the plans and to conduct all reviews as detailed in Clauses 7 and 8.

1.8 "Software"

Software shall mean the software that results from the Services provided by the Dedicated Team. The comprehensive list of Software is detailed in Annexure 3 attached hereto. Both parties agree to update this Annexure as new software results from the Services from time to time.

1.9 "Software Products"

Software Products shall mean any and all tools and commercial products that result from the Software Projects developed for ITTL. It will however, not include any third party tools and commercial products including those from Satyam ("Other Products") which may be integrated into above mentioned tools and commercial products resulting from the Software Projects.

1.10 "Software Projects"

Software Projects shall mean any and all projects that result from the Services as further defined in Annexures 7 attached hereto. Both parties agree to update this Annexure as new Services are provided through projects from time to time.

2 SCOPE OF AGREEMENT

2.1 Services and Software Projects:

Satyam shall provide to ITTL Services by carrying out Software Projects as further defined in Annexure 7.

2.2 Areas of Operation:

IDC shall operate in the technology areas covering telecommunication software products, operation support systems, computer telephony integration, intelligent networks, unified messaging, office communication systems and related applications.

2.3 Dedicated Team Size:

The size of the Dedicated Team, as of the Effective Date of this Agreement, shall be 50 and may change during calendar year 1999, as per clause 4.3.

…

10 PAYMENT AND COSTS

10.3 Terms of Payment:

Satyam and ITTL agree that the payment terms shall be those terms detailed in Annexure 1, subject to the terms and conditions of this Agreement. In case of any delay in payment and if Satyam agrees for such delay, ITTL hereby agrees to pay interest on outstanding amount at the prevailing LIBOR plus 2% applicable to United States Dollars from the due date to the date of actual payment. If Satyam does not agree for such delay in payment, the rights set out in section 11.1 below shall revert to Satyam until all outstanding payments are received. If the payments are not received within thirty (30) days or if this Agreement is terminated by Satyam pursuant to the provisions of Clause 14.15, then Satyam shall be free to market the Software, Software Projects, Software Products on its own.

11 OWNERSHIP

11.1 Intellectual Property Rights:

All Software developed by Satyam, its employees, and the Dedicated Team shall be considered a "work for hire" under all applicable laws (including, without limitation, the United States Copyright Act), and that all Intellectual Property rights relating to, arising in connection with or otherwise resulting from such work and services, and all Confidential/Proprietary Information as defined in Article 12, shall be the sole and exclusive property of ITTL. If any portion of the work or services to performed by Satyam hereunder is not eligible to be considered a work for hire under the United States Copyright Act, then Satyam shall irrevocably and unconditionally assign and transfer to ITTL, and Satyam does hereby irrevocably and unconditionally assign and transfer to ITTL, all rights to the Intellectual Property relating to, arising in connection with or otherwise resulting from the Services, the Software Projects or resulting Software Products. Satyam further agrees to have its employees execute necessary instruments deemed by ITTL and/or its attorneys or representatives to be necessary to transfer such right, title or interest in the Intellectual Property to ITTL. Satyam shall take all necessary initiatives to protect such Intellectual Property rights. Accordingly, ITTL shall own all right, title and interest in and to the Intellectual Property Satyam agrees to execute and deliver to ITTL any and all assignments and other documents or instruments reasonably requested by ITTL in furtherance of filing and maintaining the applications relating to the Intellectual Property.

Satyam, from time to time, may need to integrate software components sourced commercially from third parties, including Satyam. The intellectual property rights to such software components shall remain with its original owners, but any Software that incorporates portions of such software components shall be owned by ITTL. Satyam shall inform ITTL about such cases as and when they occur.

…

13 WARRANTIES AND INDENIMIFICATION [sic]

13.1 Warranty:

Satyam warrants that the services to be provided under this Agreement shall be of a professional quality conforming to the highest accepted computer programming standards and shall perform to the specifications provided by ITTL. Satyam represents and warrants and covenants that: (i) to the best of Satyam's knowledge, the use, reproduction, modification, creation of the Software does not and will not infringe, misappropriate or violate the valid property rights (including, but not limited to, patent rights, trademark rights, copyright rights and trade secret right) of any third party in the Software; (ii) Satyam has full power and authority to enter into this Agreement and has the professional employees to staff the Dedicated Teams as required under this Agreement; and (iii) the Software was created solely by full-time employees during the course of their employment with Satyam or by independent contractors of Satyam who have assigned all rights, title and interest in their work relating to the Intellectual Property to Satyam, including the right to create derivative software. …

…

14 GENERAL PROVISIONS

14.11 Governing Laws and Jurisdictions:

This Agreement, the relationship of the Parties and any disputes relating hereto shall be interpreted, governed and construed by the laws of the Commonwealth of Virginia, United States of America, without reference to the conflicts of laws principles thereof.

14.16 Entire Agreement:

This Agreement together with its Annexures set forth and shall constitute the entire Agreement between ITTL and Satyam with respect to the subject hereof, and shall supersede any and all agreements, understandings, promises and representations made by one party to the other concerning this subject matter herein and the terms and conditions applicable hereto. Also, in case of any inconsistency between the documents constituting the Entire Agreement, this Agreement together with its Annexures would supersede all other documents.

C Settlement Agreement

WHEREAS, Satyam and Upaid had entered into a Services Agreement dated May 19, 1999, as amended by amendment agreements dated August 9, 2000 and April 6, 2001 for provision of information technology services by Satyam to Upaid ("Services Agreement");

WHEREAS, On September 10, 1999, Satyam, ITTL and Joyce entered into that certain Share Issuance Agreement (the "ITTL SIA") pursuant to which ITTL issued to Satyam 833,333 of its common shares (the "ITTL Shares") and Satyam, Upaid, Dunn and Joyce had entered into a Share Issuance Agreement dated September 1, 1999, pursuant to which Satyam is the owner and holder of Common Shares of Upaid ("Share Issuance Agreement" or "SIA") (Unless otherwise indicated by direct reference or by context, references to the SIA shall include ITTL SIA and/or other documents, if any, in relation to the Common Shares held by Satyam for purposes of this Agreement);

WHEREAS, Satyam and Upaid desire to terminate the Share Issuance Agreement and all rights and obligations arising thereunder;

WHEREAS, a sum of USD 337,795 is due and payable by Upaid to Satyam, in respect of services performed by Satyam to Upaid under the Services Agreement and as repayment of advances made by Satyam to Upaid's Indian subsidiary.

NOW, THEREFORE, in consideration of the above and the mutual covenants and agreements contained in this Agreement, and in full and final settlement of the Parties' various rights, obligations and contentions, it is hereby agreed as follows:

2. SERVICES AGREEMENT

2.1 (a)….

(b) Subject to the fulfillment of the conditions precedent set forth in Section 1.4 above, the Satyam Parties agree and state that they have no ownership or rights to the intellectual property developed for Upaid under the Services Agreement, relinquish all claims to the ownership of such intellectual property rights.

2.2 The Parties reaffirm that the Services Agreement is terminated with effect from August 31, 2002, and has no further force or effect, notwithstanding any provisions to the contrary contained in the Services Agreement or in any other document, as to the survival of any provisions of the Services Agreement. The Parties also agree that all electronic mails and other correspondence exchanged between the Parties and any oral agreements to the extent they may exist in relation to the above mentioned Agreement shall also be deemed cancelled and have no further force or effect. Notwithstanding the above, Satyam confirms that Section 12 of the Services Agreement shall survive for a period of one (1) year from the Effective Date.

2.3 Subject to the fulfillment of the conditions precedent mentioned in Section 1.4 above, all rights and obligation of the Parties under the Services Agreement are deemed fulfilled and each of the Upaid Parties on the one hand and the Satyam Parties on the other hand, hereby irrevocably and unconditionally release, acquit, exonerate and forever discharge the other and each of their respective past and present heirs, administrators, beneficiaries, predecessors, successors, affiliates, officers, directors, shareholders, employees, attorneys, agents and representatives from any and all debts, liabilities, claims, obligations, promises, covenants, contracts, endorsements, bonds, controversies, actions, causes of action, judgments, damages, expenses and demands of any sort, either in law or equity, that they had, now have, or hereafter can, shall or may have, from the beginning of time until the execution of this Agreement or hereafter, arising out of or relating in any way directly or indirectly to the Services Agreement including claims relating to representations, warranties, intellectual property rights, quality of services performed, deliverables provided, confidentiality obligations, provision or denial of services or productivity.

2.4 Subject to the fulfillment of the conditions precedent in Section 1.4 above, each of the Upaid Parties on the one hand and the Satyam Parties on the other hand hereby irrevocably and unconditionally agree to forbear from bringing any lawsuit, cause of action, arbitration or any legal action of any nature against the other and their respective past and present heirs, administrators, beneficiaries, predecessors, successors, affiliates, officers, directors, shareholders, employees, attorneys, agents and representatives for any claims or causes of action arising from the beginning of time until the execution of this Agreement or at any time in future, in respect of or relating in any way directly or indirectly to the Services Agreement, including claims relating to representations, warranties, intellectual property rights, quality of services performed, deliverables provided, confidentiality obligations, provision or denial of services or productivity. To the extent that the Satyam Parties or the Upaid Parties have filed any lawsuit, cause of action, demand for arbitration or any legal action of any nature against the other, such filing Party shall immediately file a stipulation of dismissal with prejudice and advise any tribunal where any such filing has been made that the matter has been compromised and settled.

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2.6 Upaid acknowledges and confirms that it has received from Satyam and Satyam acknowledges and confirms that it has delivered to Upaid all source code, documentation, confidential data or information or other materials required to be provided by Satyam under the Services Agreement. Satyam confirms and Upaid acknowledges that all obligations under Clause 12.2 of the Services Agreement have been fulfilled by returning or destroying all documents, papers, data and other materials in the presence of Upaid's representatives.

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3. INTELLECTUAL PROPERTY RIGHTS

3.1 (a) Subject to Clause 2.1 (c), Satyam agrees that all Intellectual Property (as defined in the Services Agreement) developed for Upaid by Satyam, its employees shall be considered as "work for hire" under all applicable laws (including, without limitation, the United States Copyright Act), and all Intellectual Property rights relating to, arising in connection with or otherwise resulting from such work and services (as defined in the Services Agreement), shall be the sole and exclusive property of Upaid and Upaid shall own all right, title and interest in and to such Intellectual Property.

3.1 (b) If any portion of the work or services performed by Satyam under the Services Agreement is not eligible to be considered a work for hire under the United States Copyright Act, then Satyam hereby irrevocably and unconditionally assign and transfer to Upaid all rights to such Intellectual Property relating to, arising in connection with or otherwise resulting from such work and services. Satyam further agrees that they will use their best efforts to have their employees who were involved in any development projects for Upaid and also continue to work with Satyam in India to execute necessary instruments including Assignments reasonably necessary to transfer such right, title or interest in the Intellectual Property to Upaid. Further, Satyam confirms all assignments of intellectual property rights to Upaid by it and those assignments executed by Satyam employees as co-inventors of Upaid intellectual property and such assignments will survive and shall be governed by such Assignment agreements. Satyam agrees to execute and deliver to Upaid any and all assignments and other documents or instruments reasonably necessary in furtherance of filing and maintaining the applications relating to the Intellectual Property. Satyam hereby agrees not to restrict or hinder in any manner any communication with or access to any persons considered by Upaid or its patent counsel to be "inventors" with respect to its patent and patent applications. All requests from Upaid under this Clause shall be sent to Satyam in writing at reasonable times without causing inconvenience to Satyam or its employees and upon at least 15 days advance notice. Costs if any arising from Satyam or its employees complying with the requests of Upaid under this paragraph will be borne by Upaid.

4 GENERAL PROVISIONS

(a) Entire Agreement.

This Agreement (including the exhibits hereto and any written amendments hereof executed by the parties) constitutes the entire Agreement and supersedes all prior agreements and understandings, oral and written, between the Parties hereto with respect to the subject matter hereof and the SIA and Services Agreement and any other agreements between Satyam and Upaid entered up to date. Except as otherwise expressly provided herein, this Agreement may be modified or amended only by a writing signed by duly authorized representatives of each Party. The waiver by any Party of any default or breach of this Agreement, or any obligation hereunder, shall be ineffective unless in writing, and shall not constitute a waiver of any subsequent breach or default. No failure to exercise any right or power under this Agreement or to insist on strict compliance by the other Parties shall constitute a waiver of the right in the future to exercise such right or power or to insist on strict compliance.

(c) Governing Law. This Agreement and all transactions contemplated hereby shall be deemed to be made under, and shall be governed by, and construed in accordance with, the laws of England, without regard to principles of conflict of laws. Any and all disputes arising out of or relating to this Agreement shall be brought in a court of competent jurisdiction in London, England and the Parties irrevocably submit to jurisdiction and venue in London, England. If any term of this Agreement is held invalid, illegal or unenforceable by a court of competent jurisdiction, such terms shall be reduced or otherwise modified by such court to the minimum extent necessary to make it valid and enforceable. If such term cannot be so modified, it shall be severed and the remaining terms of this Agreement shall be interpreted in such a way as to give maximum validity and enforceability to this Agreement.