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Court Bans Unacademy and its Subsidiary from Using PrepLadder App

CIO Insider Team | Wednesday, 22 September, 2021
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Unacademy and its subsidiary PrepLadder are restricted from using its PrepLadder application that helps students prepare for entrance exams in the medical field, by the city civil court in Mumbai.

Unacademy bought PrepLadder for $50 million in cash and equity last year. Deepanshu Goyal, Vitul Goyal, and Sahil Goyal, as well as the rest of the 250-member team, have joined Unacademy. Unacademy, based in Bengaluru, raised $440 million in a new round of fundraising on August 2, valuing the company at $3.4 billion, according to ET. PrepLadder is an online learning platform that prepares students for exams such as NEET-PG and FMGE, CAT, UPSC, GATE, and IIT JEE.

Unacademy’s parent company, Sorting Hat Technologies Pvt., received an ex-parte order from Justice AH Laddhad, that stated to prohibit the company from using its PrepLadder app until further notice. This order also applies to the latter’s investors such as Blume Venture Advisors, Sequoia Capital India, SoftBank Vision Fund and Temasek Holdings as well. This order was passed down upon responding to a petition filed by Sri Lankan edtech startup, Medical Joyworks.

The court says that the plaintiff, that is, the Sri Lankan edtech startup can claim for compensation no sooner the assessment of any loss is done.

The necessary documents are currently being reviewed. In conjunction with its legal counsel, the company shall determine its next course of action including safeguarding its rights and interests.

In response to the court, Dr. Nayana Somaratna, CEO and cofounder of Medical Joyworks, expresses, “we are grateful to the court for granting an injunction order to preserve our rights, and for responding fast and decisively about this situation. We will pursue our case in the hopes of reaching a satisfying conclusion that respects our work, our customers, and the medical community as a whole”.

Since the Sri Lankan edtech startup provided detailed evidence to the court stating how its proprietary information, know-how, and technology was methodically replicated, altered, and presented by PrepLadder like its own.

Amit Vyas, a partner at the law firm Vertices Partners, who represented the Sri Lankan edtech startup alongside advocate Pardeep Gandhy, acknowledged the situation but declined to provide any additional information since the case is still under sub judice.

However, Unacademy responded by stating that, “PrepLadder Pvt Ltd and Sorting Hat Technologies Pvt Ltd have received notification from Medical Joyworks LLC attorneys that an ex-parte interim order has been issued against them at the Bombay City Civil Court. The necessary documents are currently being reviewed. In conjunction with its legal counsel, the company shall determine its next course of action including safeguarding its rights and interests.

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