In a recent incident, a lawsuit filed against “Yes Bank” by “Cantor Fitzgerald bank” ruled that Yes Bank was saved by an accurate grammar usage in the clause of a contract. “Yes Bank” which is India’s leading private sector bank saved millions of dollars in a recent judgment of court provided to its strict adherence to grammar.
A moratorium was imposed by RBI on March 5, 2020 that set a limit for 50.000 rupees withdrawal made without written request. The main dispute centered around of the word “Financing is used the the agreement occurred in December 2019 is applicable to private placements & private offers or FPO.
The trial continuing for a duration of 4-days gave insights that the friendship between the CEO Ravneet Gill & President Anshu Jain led to the establishment of the partnership between Yes Bank and Cantor Fitzgerald. There were almost 60 distinct businesses listed as investors, including Hinduja Group, Tilden Park, and Amansa. However, the bench of Justice Robert Bright found that Yes Bank had a good reason to believe that the FPO was excluded from the concept of “Financing” and that only be applied to private offerings.
Tilden Park and Amansa both made non-binding offers to Yes bank on March 2 and 3 in 2020. The Reserve Bank of India (RBI) intervened in this plan and imposed a pause. Thus, Gill and other board members were replaced and Cantor Bank and Yes Bank decided to take separate ways.
On the other side Mathur of Cantor was introduced to important figures of SBI to Ramadi of Tinder Park which acquired 49% share in Yes Bank. Due to this, the issue became less complicated, and in July 2020, a successful FPO was completed. So, when Cantor argued that Yes Bank had benefitted from the introduction to possible investors it provided, was unable to persuade the court that July 2020 FPO was covered by the Engagement letter. Yes Bank’s case is a reminder that avoiding crucial facts such as proper grammar can bring potential outcome to businesses.
