According to a court document from the company, Sequoia Capital India asked a local court to throw out a bad claim made by one of its former general directors, saying it was an attempt to limit its right to free speech and hurt its interests.
Sequoia has won a court case against Sandeep Kapoor, who sued the company for slander after media outlets reported on a leaked email from Sequoia on June 2. Kapoor was Sequoia’s general counsel until 2019. He did this job for almost nine years.
The lawsuit is the latest in a string of problems for Sequoia, which is dealing with complaints from new businesses about damaged trust after high-profile management mistakes at some of its portfolio companies in India and Southeast Asia.
Kapoor’s law firm, Algo Legal, said in a press release and a claim that Sequoia sent an email to its portfolio companies this month that made false references to “concerning subtleties” about the law office, which hurt its business and reputation.
Sequoia denied the claims in a 19-page court document filed on June 18 in India’s tech centre, Bengaluru. In the document, Sequoia called the claim “trivial and vexatious” and said it had a solemn duty to alert the organisations in its portfolio when it saw specific problems.
Sequoia Capital invested in a style startup in Singapore called Zilingo. An independent audit found that some payments made to Algo and its related substances “were not in accordance with the commitment terms/contracts,” so Sequoia had to warn its portfolio companies not to work with the law office, a court document says.
The recording of Sequoia, which was seen by Reuters, has not been made public.
A representative for Algo and Kapoor said on Sunday that they told the court on Saturday that the investigation into Zilingo’s promises is ongoing and that there is no final decision. They also said that Sequoia’s claims in the recording were not valid.
Sequoia said that one of the interesting things it learned from the Zilingo test was that the fashion startup paid Algo and its related parts more than $6 million between 2020 and 2022.
Sequoia said, “In this case, the right to speak freely in discourse is more important than the offended party’s right to be known, since the statement was made with almost no malice and no intention to hurt.”
Algo’s biggest client in terms of billings was Sequoia, but the U.S. investment firm ended its contract with Algo in January. Sequoia didn’t say anything about its court filings on Sunday.
The next time the case will be heard in court is on June 29.
In April, Zilingo fired its 30-year-old CEO and biggest backer, Ankiti Bose, who used to work for Sequoia. The reason was that they thought there were financial problems. Bose was later let off the hook for what she said was an unfair ending.
On Sunday, when Zilingo and Bose were asked for their thoughts, they didn’t respond quickly.
Zilingo recently said that Bose was kicked out after an independent investigation into what the startup called “serious financial inconsistencies.”
