Regional telecommunication firm Safaricom PLC and a Kenyan financial technology company, Kibo Capital Group Limited, are embroiled in a legal dispute involving invention of an electronic e-receipting application for mobile money (Mpesa) payments.
The dispute surrounds the original ownership of Mpesa Bill Manager for businesses, which Kibo Capital claims is its intellectual property. Kibo says it registered the invention in 2017 at the Kenya Industrial Property Institute (KIPI).
But Safaricom says the financial solution was not new in the country as the patent was already existing in the United States and Japan.
In addition, Safaricom says that the Mpesa Bill Manager was developed internally in the 2014/2015 financial year, two years before Kibo Capital registered the invention in 2017.
The legal dispute started at the Industrial Property Tribunal in 2022 and has since escalated to the High Court after both sides filed respective appeals against findings of the tribunal chaired by Brown Kairaria.
Subject of the pending appeal is the decision of the tribunal to dismiss the infringement claims raised by Kibo Capital against Safaricom. The appeal also concerns tribunal’s decision to reject Safaricom's request for revocation of the registration certificates issued to Kibo by KIPI for protection of the invention.
The judgment was delivered on August 31, 2022. Other members of the tribunal were Pauline Muhanda and Dr Frasia Wangari.
At the heart of the commercial dispute is a claim by Kibo Capital together with its founder/director Jasper Onyango that the Safaricom's Mpesa Bill Manager resembles their four financial utility models.
The models are titled Biller Integration and Receipting Systems, Universally Verifiable Electronic Receipt for Mobile Money Payments, Sales Initiation Closure Notification Generator Engine and Universally Verifiable Electronic Slip.
They were registered in September 2017 at KIPI and Kibo together with Mr Onyango were subsequently issued with registration certificates to protect them from infringement.
Safaricom launched the product on January 26, 2021 in a ceremony by its chief executive officer Peter Ndegwa, setting the stage for a legal dispute.
Alleging infringement, Kibo and Mr Onyango claimed that the launch occurred after holding meetings and discussions with Safaricom officers Boniface Mungania (Mpesa Head of Operations) and Lilian Njuguna (Senior Products Manager).
The discussion, they said, was about partnering to provide a financial solution that allows Mpesa customers to generate receipts for Mpesa transactions.
They accused Safaricom of infringing on their 'Biller and Receipting solution’ utility model by embodying substantially similar features, performing the same function in the same way and yielding the same results. They claimed this was done without their consent or authorization.
They said they commercialized the electronic receipting solution to various entities and acquired goodwill over a period of four years.
But Safaricom, in a counterstatement, stated that each of the four utility models was not new as at the respective filing date and was anticipated by the prior art.
Safaricom argued that the utility models related to methods for doing business via computer programs, which are excluded by law from protection as inventions.
It said the Bill Manager was an enhancement platform feature within the existing 'Lipa na MPESA' product to address some functional limitations.
"The features of Mpesa Bill manager are different from the claimed features of the subject utility models. Kibo Capital and Mr Onyango did not provide source code or any relevant documentation during the discussions with the Safaricom officials," said the telco through its representative Isaac Njoroge Kibere.
At the High Court, Kibo and Mr Onyango obtained a reprieve on April 10, 2025 after Judge Benjamin Njoroge admitted their late cross appeal.
Mr Kibere had asked court to strike out the cross appeal saying it was time barred, incurably defective and incompetent having been filed on October 30, 2023 more than one year after delivery of the judgment by the tribunal.
Justice Njoroge ruled that striking out the appeal would amount to locking out Kibo from being heard.
“The court is not persuaded that it should strike out the notice of cross appeal as no prejudice to Safaricom has been shown. Striking out the cross appeal at this stage would amount to locking out Kibo Capital from being heard. This is despite the Industrial Property Act and the Civil Procedure Rules specifying no specific timelines for filing,” said Justice Njoroge.
In the disputed judgment, the tribunal found that a comparison of the features of the Mpesa Bill Manager against the claims by Kibo Capital's utility models differed significantly and were not substantially the same.
"There is evidence that the Respondent’s MPESA Bill Manager was internally developed in the period 2014/2015 well before the filing dates of the respective utility Models,” said the tribunal.
Related to Safaricom’s challenge on the validity of the subject utility models, the tribunal found that the patents constituted relevant prior art in so far as the issuance of electronic receipts that were verifiable is concerned.
“The only aspect that we do not find common with the current utility models is the claim of being tamper-proof. As this claim appears to go beyond the claims in the earlier patents, we do not consider it appropriate to revoke the subject utility models on this ground,” they ruled.
