Glocal Healthcare and UpHealth Locked in Legal Tussle. A bitter legal battle is brewing between Kolkata-based Glocal Healthcare Systems and US-listed UpHealth Holdings. The dispute centers around a recent arbitration award issued by the International Court of Arbitration (ICC) in Chicago. The verdict directed Glocal Healthcare to pay a hefty sum of $110.2 million (Rs 920 crore) to UpHealth Holdings in damages.
Glocal Healthcare vehemently refutes the arbitration award, terming it "one-sided and perverse." In a fiery press release, the company claims the entire case hinges on criminal fraud perpetrated by UpHealth and its associates. Glocal asserts that relevant courts and investigative authorities in India are already probing these allegations.
The press release further highlights the tribunal's lack of due diligence. Glocal accuses the ICC of overlooking evidence that exonerates them of any misrepresentation and proceeds to award damages based on UpHealth's claim of losing control. Glocal argues that such control was never legitimately transferred due to the underlying fraudulent activities by UpHealth.
Interestingly, Glocal points out that UpHealth Holdings, the supposed victim of lost control, has since filed for bankruptcy and faces investigations by the US SEC and Indian authorities.
Glocal's Defense Strategy
Beyond contesting the arbitration award, Glocal has taken a multi-pronged legal approach. The company has filed multiple FIRs (First Information Reports) against UpHealth Holdings with the Kolkata Police. These FIRs allege a series of criminal activities, including:
- False representation by UpHealth officials
- Unauthorized contracts signed on Glocal's behalf
- Devaluation of Glocal's assets
- Unlawful transfer of funds and misappropriation of company resources
- Illegal access and transfer of sensitive Glocal data
Glocal seeks legal action to recover lost funds, stolen data, and regain access to its compromised accounts. Additionally, they are pursuing litigation against UpHealth before the Calcutta High Court and a Kolkata commercial court.
UpHealth presents a contrasting narrative. They accuse Glocal Healthcare of breaching contractual obligations and providing misleading information regarding their financial health during the negotiation of the Share Purchase Agreement (SPA). UpHealth claims to have invested Rs 2,100 crore in cash, stock, and debt for a 94.81% stake in Glocal. However, they allege that Glocal's promoters and directors obstructed the transfer of management control and withheld crucial financial data. UpHealth initiated arbitration proceedings against Glocal at the Chicago tribunal under the ICC's auspices. This move was reportedly in accordance with the terms and conditions of the SPA agreed upon by both parties.
With both parties entrenched in their legal positions, the path forward seems complex. The arbitration award has added another layer of complication to this already contentious dispute. It will be interesting to see how the legal battles in India and the US unfold and how they will ultimately impact both companies.
