Kolkata-based Glocal Healthcare Systems has said that it is not agreeable to the recent order of International Court of Arbitration in which the tribunal ordered it to pay up NYSE-listed UpHealth Holdings to $110.2 million (Rs 920 crore) in damages.
In a media statement, Glocal Healthcare said it has previously asserted that this case demands a criminal investigation and involves issues that are inherently non-arbitrable.
"An ICC Tribunal seated in Chicago, Illinois, has communicated a one-sided and perverse award against M/s Glocal Healthcare Systems Private Limited, a company doing path-breaking work in the field of accessible healthcare, and its shareholders. This is in the face of criminal fraud perpetrated by UpHealth Holdings Inc, UpHealth Inc and Avi Katz, Raluca Dinu, Martin S.Beck etc which has been accepted prima facie by both relevant courts and the investigating authorities. While finding no evidence of misrepresentation by Glocal or its management/shareholders, the private tribunal proceeded to award damages on the claim of loss of control to UpHealth Holdings Inc, which had never been transferred nor could have legitimately been transferred as the transaction was a part of egregious criminal fraud by UpHealth HoldingsInc (& Others) that has subsequently filed for voluntary bankruptcy and is under investigation by the SEC in US and by investigating authorities in India."
It added: "The sole reason given by the tribunal is that Glocal and others did not present their case and therefore they are responsible for this award. Glocal has always intimated that this case requires criminal investigation and encompasses issues which are on the face of it, non arbitrable. Participation in such proceedings, which were a nullity and lacking subject matter jurisdiction, would be in contrast to every tenet of legal procedure."
Beyond the arbitration, there are FIRs filed by Glocal Healthcare against UpHealth Holdings and litigations before the Calcutta High Court and a commercial court of Kolkata.
In a 2022 FIR filed by Glocal Healthcare against UpHealth Holdings, it alleged that the accused engaged in various illegal activities without Glocal's approval.
This included falsely representing themselves, entering contracts on Glocal's behalf without authorisation, and devaluing Glocal's assets. Additionally, the FIR alleged that the accused unlawfully transferred funds from Glocal's accounts and misappropriated company resources.
They also illegally accessed and transferred sensitive data belonging to Glocal, violating privacy laws.
The FIR further accused it of cheating, breach of trust, and criminal conspiracy. Glocal demands legal action to recover misappropriated funds, retrieve stolen data, and restore access to its accounts and emails, it said.
Another FIR was filed in 2023 by Glocal Healthcare where it held UpHealth Holdings for fraud and demanded an investigation into its actions.
In its case, UpHealth Holdings has accused Glocal Healthcare Systems of violating its contractual and statutory obligations. Additionally, it accused Glocal Healthcare Systems of providing false information regarding its value during the negotiation of the Share Purchase Agreement.
UpHealth claimed that it has paid an amount of Rs 2,100 crore in cash, stock, and debt to acquire a 94.81 per cent stake in Glocal and yet its promoters and directors prevented the transfer of management control and did not share financial statements of Glocal with UpHealth.
Glocal Healthcare offers technology-based healthcare services.
UpHealth started arbitration proceedings in the Chicago tribunal under the aegis of the International Chamber of Commerce (ICC). Earlier, when Glocal and its promoters had tried to obstruct UpHealth from moving US arbitration, UpHealth's lawyers had told an Indian court that the arbitration proceedings and the US venue were as per the terms of the SPA (share purchase agreement) agreed by the parties during the deal.