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Budget hotel aggregator and marketplace OYO has dragged smaller rival ZO Rooms to the court over allegations pertaining to harassment and blackmailing to for fulfill unreasonable demands. The Softbank-backed company has filed the case in the Delhi High Court.
The company in a statement said that, “Since more than one-year, we’ve been continuously inconvenienced and harassed by Zostel and its directors. They’ve used every tactic, from sending letters carrying false allegations to OYO’s management to writing to our shareholders, for intimidating and pressurizing us to submit to their unreasonable demands.”
OYO has also filed a criminal complaint against the founders of Zostel on January 16, 2018, under Section 405, 406, 415, 420, 425 and 426 pertaining to Criminal Breach of Trust, Cheating and Misrepresentation of data, the company said.
“They are only trying to arm twist and blackmail OYO and its investors into getting their deal done without having a real business or even a binding agreement at hand and threatening us through legal routes,” the company said adding that OYO has filed cases under IT and Copyright Acts with the Economic Offences Wing and Cybercrime department against senior employees of Zostel, the hostel aggregator brand of ZO, for stealing data and other assets including laptops which continue to be under Zostel’s access even now and being used to its benefit.
OYO further said that the Bangalore-based startup had also filed a misconceived and baseless Section 9 arbitration petition in the Gurgaon court on February 2, 2018, making false allegations against OYO relate to a long expired and non-binding term sheet.
It is important to mention here that both companies have been fighting against each other over the 2016 deal which ZO claiming OYO had acquired the company while OYO maintaining the deal fell through after due diligence and that it has plenty of reasons for not acquiring the company.
Meanwhile, ZO Rooms has maintained that the Ritesh Agarwal-founded hotel network which raised $250 million in funding, had acquired the company alongwith its employees and later shutting down the app this leaving the ZO Rooms team in lurch. ZO Room’s founders were not available for comments.
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