Code.org, a non-profit organization in the US, has taken legal action against WhiteHat Jr, a subsidiary of Byju’s, for allegedly breaching a licensing contract. The lawsuit, filed in a California district court, claims that WhiteHat Jr failed to pay fees as outlined in the contract while still using Code.org’s platform.
Last year, WhiteHat Jr, which was acquired by Byju’s for $300 million, entered into a partnership with Code.org and agreed to pay $4 million over four years to use its coding education platform. However, Code.org alleges that WhiteHat Jr did not adhere to the payment schedule as agreed upon in the contract.
According to Code.org, WhiteHat Jr paid its 2022 licensing fee but then informed the non-profit earlier this year that it would be unable to make the remaining scheduled payments under the four-year deal. WhiteHat Jr requested the original agreement be amended to backload its outstanding license fee obligations, but Code.org claims the original contract stipulates that even in the event of termination, WhiteHat Jr would still be obligated to pay all future licensing payments owed.
Code.org’s lawyers allege that WhiteHat Jr has failed to pay the Q1 2023 invoice or the Q2 2023 invoice, despite repeated requests for payment. Byju’s did not offer a comment on the lawsuit.
This legal action adds to the problems Byju’s has faced since acquiring WhiteHat Jr. Earlier this year, Byju’s considered shutting down WhiteHat Jr, and the company has also been criticized for delays in filing its financial accounts and governance issues. Additionally, Prosus, a major investor in Byju’s, recently slashed the valuation of the company to below $3 billion.
Overall, Byju’s and WhiteHat Jr are facing mounting challenges and legal issues, highlighting the difficulties that can arise from acquisitions and partnerships in the rapidly evolving edtech sector. As the lawsuit unfolds, it remains to be seen how the legal battle between Code.org and Byju’s will affect the future of both companies.
