Boon for locked down kids or ‘marketing hype’? Decoding WhiteHat Jr’s legal brawls with critics

Edtech startup WhiteHat Jr.'s advertising practices and curriculum have been questioned by its critics. It has now taken two of its most vocal critics to the court.

Illustration by Soham Sen | ThePrint

New Delhi: Earlier this week, a software engineer, an IVF specialist and an edtech startup locked horns in the Delhi High Court.

The startup, WhiteHat Jr, offers online coding classes for kids, nudging parents to “kickstart your kid’s journey to create the next billion-dollar idea of the tech world”. Its website lists various course packages costing around Rs. 700 per class.

Acquired by edtech unicorn Byju’s in August after just 18 months of operation for $300 million (Rs 2,223 crore), all was going well for WhiteHat Jr. until critics started posting about the company, its curriculum, its teachers and its advertising practices over several social media platforms.

The company has now taken two of its most vocal critics – software engineer and UPSC aspirant Pradeep Poonia, and IVF specialist and angel investor Aniruddha Malpani – to court. In the Delhi High Court, it has sought a whopping Rs 20 crore and Rs 14 crore as damages, from Poonia and Malpani, respectively, for impacting WhiteHat Jr’s goodwill, reputation and business.

WhiteHat Jr has cited several of Poonia’s and Malpani’s tweets and posts to allege defamation, trademark infringement, unfair competition and invasion of privacy, among other things. It has alleged that they have been maliciously posting false claims about the startup on their social media platforms.

The case against Poonia and Malpani was heard on 23 and 24 November, respectively, and in both the suits, the high court passed interim orders in WhiteHat Jr’s favour. Malpani was asked to take down 12 of his tweets within 48 hours and was restrained from posting or sharing any content which is defamatory or derogatory to the startup.

Poonia was also asked to take down several of his tweets and videos, and barred from using the name ‘WhiteHat Sr’ for his YouTube channel till the next date of hearing. He has since renamed his channel to ‘Pradeep Poonia 1.0’.

Acquisition & advertising campaign

While 2020 has seen several businesses struggling, Bengaluru-based edtech unicorn Byju’s acquired WhiteHat Jr in August for $300 million. The deal was attributed to a “coronavirus-led boom”, which has forced millions of children to go online for studies.

Reports at the time discussed how the deal was struck over a span of six weeks, through WhatsApp messages and Zoom calls between Byju’s founder and CEO, Byju Raveendran, and WhiteHar Jr founder and CEO, Karan Bajaj, who continues to lead the company post acquisition.

The acquisition was immediately followed by an aggressive advertising campaign. The Economic Times had then quoted “media planners”, who it said estimated that “WhiteHat Jr may be spending between Rs 10 crore and Rs 15 crore in advertising on digital media platforms”.

However, its advertisements soon came under scrutiny, with the Advertising Standards Council of India (ASCI) questioning five of its ads on the ground that they made dubious and unsubstantiated claims. WhiteHat Jr had then reportedly agreed to immediately withdraw those ads when the ASCI asked them for their response to the complaints.

Posts from parents whose children had taken classes with WhiteHat Jr have also cropped up. For instance, a LinkedIn user Neha Jain recalled her nine-year-old’s experience a month back, writing that the teacher assigned to her kid claimed to be “a child psychiatrist” and “played with my child’s mindset”.

‘An imaginary child’

WhiteHat Jr’s ads also featured ‘Wolf Gupta’– a 9 to 13-year-old who bagged Rs 1.2- 150 crore job from Google. Wolf Gupta’s age and salary package kept changing in the ads. The startup began running this advertisement earlier this year, but attracted significant criticism for it.

In fact, one of Poonia’s first posts was also about Wolf Gupta. While these advertisements were subsequently withdrawn, it is only now in its suit against Poonia that the company addressed the character as “an imaginary child” for the first time.

However, at the time such posts and videos began appearing, WhiteHat Jr, again by its own admission in the high court, “responded by sending takedown notices to the relevant social media platforms”.

So whenever Poonia put up a video, his videos were taken down one by one, first by Aiplex Software Pvt Ltd, then by Byju’s online reputation management [ORM] team, and finally WhiteHat Jr’s ORM team. On its website, Aiplex lists Byju’s as one of their clients.

Poonia’s videos also questioned several aspects of the company’s functioning, including their teaching methodologies, their teachers’ credentials, its coursework and its advertising strategies.

He kept reuploading videos consistently, only to find out that they were taken down very quickly, at times within 30 minutes of uploading them.

“3 articles on LinkedIn, One LinkedIn account, 2 Reddit accounts, one Twitter handle, 16 YouTube videos, and 2 YouTube accounts of mine have been removed or blocked because WhiteHat Jr and Byju’s has reported it,” Poonia told ThePrint.

‘It’s like putting me in jail’

Speaking to ThePrint, Poonia lamented, “When you take away all my options to speak out – it’s like putting me in jail. How can I speak? Whom do I speak to?”

He said that so far, all his accounts have been reinstated, except for his LinkedIn account.

“All my professional contact and network is there. So without it, I feel paralysed professionally. I can’t connect to the largest network of professionals in the world because LinkedIn has blocked me from having an account,” he said.

Apar Gupta, Executive Director at the Internet Freedom Foundation, told ThePrint that when such an assertion by a copyright owner alleging infringement of their ownership rights is made, platforms take down the content in order to avoid contributory liability or be held as an abettor to the infringement.

However, he added that the bigger question that arises in such instances is “Where does that leave derivative work, or works of parody, or works of criticism quite often against corporate actors?”

“Often, this framework does not offer sufficient protection to end users who end up being the target of large corporations. What may help is greater notice, ability to rebut and transparency in the decision-making process prior to a takedown,” Gupta said.

ThePrint asked LinkedIn on 24 November if it has blocked Poonia and Malpani’s accounts because of such requests from Byju’s or WhiteHat Jr.

In an email response, LinkedIn confirmed that the accounts had been “restricted”, but said that it cannot comment any further on member accounts due to their privacy policy.

‘Aggressive’ advertising strategies

Malpani claims to have first noticed WhiteHat Jr ads around August or September this year.

“What stood out to me was how aggressive the advertising was given the population it was targeting,” he told ThePrint.

“What parent can refuse a proposition that says your child can code an app? Parents are vulnerable in a position like this, especially because most parents won’t know much about coding or how it works,” he added.

But Malpani pointed out that while their “advertising might be impressive, their curriculum is not”. He claims that the curriculum from WhiteHat Jr is already available on code.org for free.

Malpani’s grievance with WhiteHat Jr and Byju’s is similar. He says that both mislead in their ads, that there is poor work culture that leads to frequent hiring and firing, that the companies are more focussed on money and targets than the growth of its young employees and its students who get very little coding experience.

In fact, Malpani has a pending case against LinkedIn in the Bombay High Court. He had filed it in September this year, after LinkedIn allegedly deleted his account after he criticised Byju’s on the platform. He alleges that his right to freedom of speech and expression has been “stifled” and has asked whether social media platforms have the right to censor Indian users in this way.

WhiteHat Jr versus WhiteHat Sr

In addition to defamation, WhiteHat Jr has also accused Poonia and Malpani of infringing its trademarks, diluting and tarnishing it. For instance, it had said that Poonia’s YouTube channel is called “WhiteHat Sr”, which it said “is deceptively similar to the registered trademark” of WhiteHat Jr.

Several of Poonia’s tweets have also been taken objection to, with WhiteHat Jr submitting that they make false claims against the startup and defame and malign it. For instance, in one of the tweets that it cites, Poonia called the company a “ponzy scheme” (sic), and in another, he called their business model “child abuse” and asked, “How is this diff from child sexual abuse?” (sic).

Additionally, Malpani has been accused of “unfair competition”, by pointing out that he is an angel investor in Bibox, which it says targets the same class of consumers as WhiteHat Jr and claims to teach “entrepreneurship” and “innovation” to children.

It also mentions more of Malpani’s portfolio companies, including Concept Owl and Multibhasha, to submit that “the target audience of the Defendant’s investee companies and the Plaintiffs are identical, thus attributing a clear motive to the Defendant’s malicious and deliberately slanderous and defamatory propaganda against the Plaintiffs.”

In an email to ThePrint as well, WhiteHat Jr has claimed that Malpani cannot take the defence of fair commentary, saying, “Fair commentary can be argued by individuals who don’t have skin in the game and make comments from an arm’s length; not by an individual whose commercial investments stand to be impacted by defaming and disparaging a successful business rival.”

WhiteHat Jr, however, did not specifically respond to ThePrint’s queries on Poonia.

The defence of “fair comment” comes in handy in defamation cases if statements that are allegedly defamatory are actually just comments or criticism in a matter of public interest. The defence is based on the right of people to comment and criticise, without any malice, the work or activities or those whose career is based on public attention.

ThePrint reached out to Byju’s, but the company had not responded till the publication of this article.

In a LinkedIn post, Bajaj also wrote about the defamation case, saying that “false, unethical attacks, including attempts to breach into company servers & defame women teachers, severely impacted employees & teachers daily”.

He added, “We’ve made mistakes while growing up. Our marketing campaigns were poorly designed, which we changed. Legitimate, honest, fact-based criticism is truly welcome.”

 

‘A SLAPP suit’

Against Poonia, the plaint copy says that Rs 20 crore were being sought under various heads, including “for the loss of reputation and image, namely the intangible aura and the goodwill being enjoyed” by the company.

It claims that the company has “suffered a steep decline in the rate of conversion of trial classes to student registrations since September 2020, i.e., when the Defendant’s (Poonia’s) tweets first appeared.” The conversion rate, it said, dropped from 12.8% in August to 9.9% as of 15 November.

So both Poonia and Malpani have been blamed for the total loss in revenue from September to November to WhiteHat Jr. The damages to be paid by both of them has been calculated on a “pro-rata basis on the basis of the number of followers” that they have.

It claims to have suffered Rs 35 crore as the total loss, out of which approximately Rs 21.6 crore has been attributed to Poonia and the rest to Malpani.

However, Poonia’s lawyer Swathi Sukumar called this case a “SLAPP (strategic lawsuit against public participation) litigation”.

“This appears to be a SLAPP (strategic lawsuit against public participation) litigation, which is commonly used in India and other jurisdictions to try and control public opinion,” she told ThePrint.

‘WhiteHat Jr is going down’

However, despite the high court’s interim directions to take down certain posts, both Poonia and Malpani seem to be unrelenting.

Talking to ThePrint, Poonia asked, “It’s their ads, marketing strategies, product quality, and their own deeds that defamed them, then why the defamation case over me?”

Poonia asserted that he will not back down from this case, saying, “WhiteHat Jr is going down with the kind of proof I have. I have solid proof that they don’t want the judge to see. I am not backing down and I am not afraid of their Rs 20 crore lawsuit.”

Malpani also chimed in, saying that fighting so many cases is “not fun” for him.

“…but I do it because when you see something wrong and you see others being hurt by it, you are supposed to raise your voice before the damage becomes bigger,” he added.