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Digital Marketing Company V Health & Fitness Company

Date of Claim raised:15/08/2021
Date of Conciliation: 06/08/2021, 20/09/2021/ 16/10/2021
Date of Settlement: 16/10/2021
Digest: Mediation/Conciliation/Dispute/Claimant/Respondent/Invoice/Settlement
Case Summary

The dispute was between a Digital Marketing company based out of Bangalore and a nationwide health and fitness company headquartered in Mumbai. The claimant, in this case, the digital marketing company, was hired by the health and fitness company (the Respondent) to create and maintain their digital presence and generate leads. The agreed terms were a total budget spend of Rs. 17,50,000/-, which would be split as 12,00,000/- towards creating online properties and the remaining Rs. 5,50,000/- towards digital marketing and lead generation. On the basis of the agreed terms, the first part of the deal was executed. However, the dispute occurred while the invoice for the lead generation campaigns was raised.

The Issue

While the creation of digital content was agreeable, according to the respondent, they denied payment of Rs. 3,75,794/- of the total invoice of Rs. 5,50,000/- raised. The argument given was that they were unhappy with the quality of leads generated and the conversion thereof. This created a standoff on both ends, and a final attempt at negotiation was attempted before litigation.

The Resolution

After going through all the documentation for the deal, the mediator established the authenticity of the claim. A discussion with the respondent was initiated, and his side of the story was heard. The respondent, while appreciating the work undertaken on the creation of digital content, expressed absolute displeasure at the lead generation conducted, claiming very poor conversion ratios and poor walk-ins generated. The mediator here tried to understand the process flow at the respondent's end once the leads were delivered to understand the gaps' if any. After interviewing the relevant teams, what came forth was that the leads that were generated were not centrally managed but moved to relevant geographies across the country. This created a lag of a day or two before these leads were attempted to be connected and lost their value. Post explaining the same to the respondent's management team, the claimant's team also suggested that they would help in improving the lead management process, which was gladly accepted by the respondent.

The Settlement Agreement

The respondent agreed to pay the entire outstanding amount of Rs. 3,75,794/- on or before 31 January 2022.

The Inference

Taking a deep dive into an issue at hand can often create value for the parties involved.