Mediation Transcript
Date: 30th Nov
Location: SS Legal LLP, New Delhi
Mediators: Shailvi Gupta and Sana Fatma (Certified IICA Mediators)
________________________________________________________________
Parties Present:
Representative of the M/s Bajaj Finance Ltd. (NBFC): Shana Ansari, MD of
M/s Bajaj Finance Ltd.
Loan Borrower (Business Owner): Yogesh Mishra
Mediators: Shailvi Gupta and Sana Fatma
________________________________________________________________
Sana: Good morning, my name is ______________, I am the Principal
Associate at SS Legal LLP. I am a certified IICA mediator and have
experience of more than 10+ years in mediation.
Shailvi: Hello, My name is Shailvi Gupta, I am also the Principal Associate at this
law firm. I am also a certified IICA mediator and have experience of 10+
years in mediation and conciliation.
Ansari: Good morning Ma’am, I am Shana Ansari, representative of M/s Bajaj
Finance Ltd. I have been duly authorized by my company to represent in
the present mediation. I shall present the Authorisation letter to you/This
is the authorization letter. [Shows Authorisation letter to Mediators]
Yogesh: Greetings Ma’am, I am Yogesh, and I am the sole director and proprietor
of M/s Rainbow Toys Pvt. Ltd.
Sana: Let’s begin by hearing from the representative of M/s Bajaj Finance Ltd.
Ms. Shana Ansari. Please outline your concern.
________________________________________________________________
Flipo Healthcare Pvt. Ltd. (Licensee) Representative: Shana Ansari, CMO
Dermaceuticals Manufacturers Ltd. (Licensor) Representative: Yogesh Mishra,
COO
Opening statements-
Sana- Let’s begin by hearing from the representative of Flipo Healthcare Pvt. Ltd.
Ms. Shana Ansari. Please outline your concern.
Ansari: We entered into a Supply and Licensing agreement with Dermaceuticals
Manufacturers Ltd. to market and distribute their Dermaceutical products,
specifically “GlowFast” and “SkinPlus,” in the Indian market.
Unfortunately, we’ve encountered significant operational difficulties that
have affected our ability to meet the performance standards outlined in
the agreement. The primary challenge is that the opposite company has
failed to deliver the required quantities of the products on time, and this
has caused a serious disruption in our distribution network.
For example, shipments of “GlowFast” capsules were delayed multiple
times, leading to stockouts at retail pharmacies. Similarly, there were
issues with the regulatory compliance for “SkinPlus,” which created
further hurdles in ensuring the product met the market requirements in
time for its launch. These delays have led to lost sales, damaged
relationships with customers, and a tarnished reputation in the market.
Given these breaches, we have had to consider terminating the
agreements, as the delays have been material and have significantly
impacted our business. However, we are still open to modifying the
agreements if [Company B] can provide more security regarding future
performance.
Yogesh: Thank you, Mediator. We recognize the challenges that [Company A] has
faced, but we disagree with their characterization of the situation. The
delays in GlowFast shipments and the regulatory issues with SkinPlus
were largely due to factors outside our control. For example, there were
sudden changes in Indian regulatory requirements, and our suppliers
faced unexpected logistical issues that delayed the shipment of the
products.
While we accept that there have been delays, we do not believe they
constitute a material breach of contract. As per the Supply and Licensing
Agreement, we have provided the necessary products, and we have made
efforts to address the issues. However, it is also important to note that
[Company A] has failed to meet the sales targets set forth in the
agreement. The market penetration goals for both GlowFast and
SkinPlus were not achieved within the stipulated time frame.
This underperformance has impacted our ability to support [Company
A]’s sales efforts, and we have concerns about the ongoing viability of
this relationship under the current terms. We believe the situation can be
improved if we revise the terms of the agreement rather than terminate it.
We are open to discussing ways to adjust the supply schedule and the
sales expectations in a way that is fair to both parties.
Shailvi: Thank you both for explaining your positions. It seems that there are two
primary issues at the heart of this dispute: the delays in product delivery
and regulatory compliance, and the unmet sales targets. Both of these
have caused significant strain on your business operations.
Before we proceed, let’s clarify the following:
1. Delay of Products: Ansari/Flipo is requesting more certainty and
reliability regarding the future supply of GlowFast and SkinPlus, and
it appears that second party is willing to make adjustments to the
delivery schedules.
2. Sales Performance: Dermaceuticals has raised concerns about Flipo’s
failure to meet sales targets. While this is an important point, perhaps
we could explore ways to modify the sales targets and performance
clauses to account for the delays and external factors that have
impacted both sides.
Ansari: We are open to discussing the adjustment of sales targets, considering
the delays and the external factors that both sides have faced. However, we
would like [Company B] to take concrete steps to address the supply chain
issues moving forward. For example, we would like to agree on a revised
delivery schedule with specific timelines, as well as penalties if those timelines
are missed due to [Company B]’s fault.
Yogesh: We agree that communication is essential, and we are willing to
provide regular updates regarding delivery timelines for both products.
However, we are hesitant about including penalties in the agreement as we
believe the delays were largely out of our control.
Sana: It appears that parties are at a deadlock regarding penalties. To resolve
this let’s consider a hybrid solution.
1. Revised Delivery Schedule: [Company B] will agree to a more defined
and detailed delivery schedule for both GlowFast and SkinPlus, with
regular updates on shipment status.
2. Penalty Clause (Limited): A penalty clause will be included, but it will
only apply to situations where the delays are due to [Company B]’s fault,
and the penalties will be limited to a percentage of the product cost
rather than a blanket penalty.
3. Performance Review and Incentive Structure: Both parties will agree to
a performance review mechanism where the sales targets can be
adjusted based on actual performance and market conditions. If
[Company A] exceeds the targets, they will receive a financial incentive
or marketing support from [Company B].
4. Transparency and Communication: A monthly meeting will be scheduled between
the parties to review supply and sales progress, with the aim of identifying and
resolving issues early.
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