Court dismisses counterclaim due to insufficient evidence linking contract breach to specific financial losses.

COMMERCIAL COURT

[2025] IEHC 430

RECORD NUMBER 2022/6348P

THE HIGH COURT

BETWEEN

V MEDIA DOO & FIRST CLICK MARKETING OPERATIONS MANAGEMENT

LIMITED

PLAINTIFFS

AND

TECHADS MEDIA LTD

DEFENDANTS

JUDGMENT of Mr. Justice Michael Twomey delivered on the 28th day of July, 2025

INTRODUCTION

1. The Mediation Act 2017 (the “2017 Act”) obliges a court to adjourn proceedings, if the proceedings were issued without a statutory declaration that the plaintiff was advised to consider mediation, instead of litigation.

2. Does this mean that a court should seek this evidence before it proceeds with hearing any proceedings, to which the 2017 Act applies, so as to ensure that hearings are heard in compliance with the 2017 Act?

3. The background to this issue is that the 2017 Act introduced very significant restrictions to the constitutional right of access to the courts. Prior to its enactment, there was nothing to stop a person going to the courts as a first port of call to resolve her dispute. However, this was all changed by s 14(1) of the 2017 Act. This section provides that a solicitor must provide mediation advice to her client and that the solicitor is only entitled to issue proceedings on behalf of a plaintiff, after the plaintiff has been advised to give consideration to mediating, instead of litigating. Section 14(1) sets out in detail the various pieces of mediation advice which the solicitor must give a plaintiff before the plaintiff even considers litigating.

4. In addition, under s 14(2) of the 2017 Act, if proceedings are subsequently issued, evidence, that this detailed mediation advice was given, must be provided by means of a statutory declaration (“Mediation Declaration”) by the solicitor, which must accompany the proceedings.

5. Most significantly of all is the fact that under s 14(3) a court must adjourn a hearing if the proceedings were issued without the accompanying Mediation Declaration, so as to enable the mediation advice to be provided. In effect therefore, the courts must refuse to hear a case, if there is no evidence that the plaintiff was provided with the requisite advice to consider mediation.

6. While all of this amounts to a clear restriction on the constitutional right of access to the courts, it is clearly justified, since it is in the interests of prospective litigants. This is because it is as an attempt by the Oireachtas to ensure that litigation is a last resort, rather than a first resort, in order to save prospective litigants tens/hundreds of thousands of euros in legal costs and the many years of lost time and effort.

7. With some limited exceptions1, the law therefore which this Court must apply is that, in all court proceedings, if there is no accompanying Mediation Declaration, the court must adjourn the hearing.

8. This raises the question of whether, in cases to which the 2017 Act applies, a court must seek evidence that the plaintiff was duly advised to consider mediation, instead of litigation, before the court will hear the action. Must a court seek evidence that plaintiff was advised to consider mediation?

9. In this Court’s view, the only logical answer is yes. This is because s 14(3) is mandatory in nature. It states that the court ‘shall’ adjourn the proceedings if the ‘originating document by which the proceedings are instituted’ is not ‘accompanied’ by the Mediation Declaration. Thus, if a court hears a case, where the proceedings were not accompanied by the Mediation Declaration, the hearing would be in breach of s 14(3) of the 2017 Act. It follows that the only way to avoid a court hearing being held in contravention of s 14(3) is for the court to seek evidence that the proceedings were accompanied by the Mediation Declaration, before commencing the hearing.

10. To put it another way, under s. 14(3) of the 2017 Act, the Oireachtas obliges the courts to adjourn proceedings, if those proceedings were issued without an accompanying Mediation Declaration. It seems to this Court that, if a court is to discharge its obligation, the Court There are some proceedings which are not subject to s 14 of the 2017 Act. For example, under s 14(4) an application under the Guardianship of Infants Act, 1964 is exempted from s 14. must first enquire as to whether there was an accompanying Mediation Declaration. Otherwise, the mandatory adjournment of proceedings, which is required to happen under s 14(3), would be rendered illusory.

11. This therefore puts an onus on all courts, to ensure that a plaintiff has been comprehensively advised to consider mediation instead of litigating, before hearing a case. Of course, this is entirely logical in light of clear desire of the Oireachtas to save parties huge amounts of time and huge sums in legal costs, but also because of the considerable public interest in saving court time. As noted by Kennedy J. in Byrne & Ors v Arnold [2024] IEHC 308 at para 19, s. 14 of the 2017 Act is aimed at protecting clients: “Section 14 [of the 2017 Act] protects clients by ensuring that they are fully informed as to options which may, inter alia, reduce their exposure to cost and risk. The provision also advances the public interest, discouraging unnecessary recourse to the courts (and legal expense) and promoting alternatives which may lead to outcomes which can be in the interests of all parties.” (Emphasis added)

12. Indeed, the extent of the importance which the Oireachtas attaches to protecting clients of solicitors from the costs and delays of litigation becomes clear, when one considers how far the Oireachtas has gone in this regard. This is because:

• the Oireachtas has taken the ‘extraordinary’ step of interfering in the lawyer/client relationship (to quote Kennedy J. 2) by dictating pursuant to s 14 of the 2017, the very nature of the advice which must be given to a client. For example, it requires a solicitor to give advice to her client on: o the ‘advantages of resolving the dispute otherwise than by’ litigating (s.

14(1)(c)(i),

Something which Kennedy J. noted that it rarely does - see Byrne & Ors v Arnold [2024] IEHC 308 at para 19), o the ‘benefits of mediation’ (s. 14(1)(c)(ii)), o the confidentiality of mediation agreements (s. 14(1)(e)) o the enforceability of mediation agreements (s. 14(1)(e)) o the fact that a Mediation Declaration must accompany the proceedings (s.

14(1)(e)), and

o the fact a court must adjourn the hearing, if a Mediation Declaration does not accompany the proceedings (s. 14(1)(e));

• the Oireachtas has taken the unusual step of interfering in the discretion of a court, whether or not to adjourn proceedings, by giving the courts no discretion under s. 14(3) of the 2017 Act, as the courts must adjourn the proceedings if the proceedings were issued without the accompanying Mediation Declaration.

• the Oireachtas has restricted the constitutional right of access to the courts, by providing that access to the courts is only available to a plaintiff, after she has been comprehensively advised to consider mediating rather than litigating.

13. Since the clear aim of s 14 is to ensure that litigants are protected from spending enormous sums on litigation unnecessarily, it is clear that the only way to ensure that this legislative aim is achieved, is by the courts checking that clients have been advised on the merits of mediation over litigation, as required by the 2017 Act. A recent example of a court checking on the filing of the Mediation Declaration is provided by Byrne v Arnold where Kennedy

J. at para 12 of his judgment noted that he asked ‘early in the hearing’ whether the declaration had been filed.

14. For all these reasons therefore, it seems to this Court that s 14(3) of the 2017 Act must mean that there is an obligation on the courts to only commence hearings if they have been satisfied that plaintiffs have been comprehensively advised on mediating, rather than litigating their dispute, as required by s 14(1) of that Act.

15. This is what this Court did in this case. This Court sought sight of the Mediation Declaration at the opening of the hearing

16. In order to ensure that the present hearing was not held in contravention of s. 14(3) of the 2017 Act, on the first day of the hearing, this Court sought evidence that Mediation Declaration had accompanied the proceedings which were first issued in this case. However, this Court was told by counsel for the plaintiff that the proceedings had been issued without the accompanying Mediation Declaration, and so in direct contravention of s 14(2) of the 2017 Act.

17. Later that day, the Court was provided with a copy of a Mediation Declaration that had just been sworn. However, this declaration did not, and could not, retrospectively remedy the breach of the 2017 Act, since the proceedings in this case had been instituted, without being ‘accompanied by’ the Mediation Declaration, and so in direct contravention of s 14(2) of the 2017 Act. The execution of the Mediation Declaration is not a box ticking exercise

18. The Oireachtas makes clear, by the level of its interference with the discretion of the court regarding adjournments, that the execution of the Mediation Declaration is not a boxticking exercise for the courts. This is because the absence of a Mediation Declaration is sufficiently serious that the Court must, in effect, halt the hearing. The consequence could hardly be more serious.

19. Similarly, the Oireachtas makes clear, by specifying in great detail the legal advice that a solicitor must provide to her client, that it is not a box-ticking exercise for solicitors. This advice on mediation is so important that before a solicitor can even issue proceedings for her client, she must have given the client the comprehensive advice set out in s 14(1). Then if proceedings are subsequently issued, they are required to be accompanied by the Mediation Declaration. Thus, proceedings cannot be, or should not be, issued without this Mediation Declaration. All of this is far removed from a box-ticking exercise. Heavy onus on solicitor to advise that plaintiff consider mediating rather than litigating

20. In addition, it is to be noted that s. 14(1) of the 2017 Act puts a considerable onus on solicitors, since they are required to advise on the benefits of mediation to their client before the client ends up on what might be termed the merry-go-round of litigation –- one that is all too easy to get on, but can be difficult to get off.

21. The task that solicitors have been set by the Oireachtas should not be under-estimated. In particular, under s. 14(1)(a) and s. 14(c)(i) of the 2017 Act, the solicitor must advise the client on the ‘advantages of resolving the dispute otherwise than by way of the proposed proceedings’ (emphasis added) and on the ‘benefits’ of mediation. Solicitors are being asked to act in a way, which it could be argued, is contrary to the solicitor’s financial interest. This is because the Oireachtas has set solicitors the onerous task of advising plaintiffs on the benefits of mediation, which must include the very considerable financial benefits of mediating, rather than litigating. Thus, a solicitor would, it seems, be required to explain to the client that the legal fees for a successful mediation (say over a month or two) are likely to be a fraction of the legal fees generated over say four years of litigation (i.e. issuing various proceedings, making/defending pre-trial applications, discovery, undergoing a trial and then an appeal.) This is particularly so since High Court legal costs have been described as ‘‘prohibitive’3 and so a considerable financial negative for the client, albeit that prohibitive fees might be regarded as a financial positive for recipient of those fees - the lawyers.

Bourbon v Ward [2012] IEHC 30 at page 40, per Kearns P.

22. Of course, the role of the courts is to look out for the interests of litigants,4 rather than lawyers, and one way to achieve this is by the courts ensuring that, before any trial is permitted to commence, the plaintiff has been properly advised of the considerable financial, timing and other benefits to mediating, rather than litigating. Mediation is an opportunity for reality-checking of a plaintiff’s claims

23. One of the reasons why advising a person to consider mediating, rather than litigating, is so important, is because mediation offers a crucial opportunity for ‘reality checking’ of a plaintiff’s claim, before a court gets to do so. This is because one of the roles of the court is to apply common sense and scepticism to plaintiffs’ claims, in essence, a form of realitychecking. This is clear from the Supreme Court case of Rosbeg Partners v LK Shields [2018] IESC 23. There, O’Donnell J. stated that when the courts are considering a claim by a litigant for money from another party, the courts ‘should approach claims’5 such as these by applying ‘common sense’ and ‘some degree of scepticism’ to them. The reasons, for the application of this type of reality check are set out at para 22 by O’Donnell J, and can be summarised as follows:

(i) human nature is such that there is a tendency for litigants to look at issues only from their own perspective,

(ii) human nature also means that litigants tend to view matters with the benefit of hindsight, and

(iii) where monies are claimed (in that case profits), they are a lot easier to make on paper than they are in real life (a similar point could be made regarding special damages, i.e. it is easier to spend other people’s money on out-of-pocket expenses, than if it was one’s own money.)

Interview with former President of the High Court, Irvine P, The Irish Times (6 August 2022). Emphasis added. While Rosbeg concerned a professional negligence action, these reasons are equally applicable to other claims for money e.g. personal injuries, property disputes or, as in this case, a breach of contract claim.

24. While it is usually a plaintiff who is claiming money, this is a case, where the defendant is also claiming money (as part of a counterclaim). It is therefore a case where the claims of both the plaintiffs and the defendant must, in line with Rosbeg, be subjected to ‘common sense’ and ‘scepticism’.

25. This case also illustrates the broader point being made in Rosbeg, that human nature is such that persons who undertake litigation, like any other task, will often seek to be as successful as possible, which often means portraying the damage that they have suffered, or the amounts they have lost, at their absolute height. However, the downside of such an approach is that litigants can end up ‘believing in their own publicity’, as they repeat and provide evidence for their claims, and so reinforce their own belief in their claims.

26. Unfortunately, the problem with this approach is that it can reduce the likelihood of a settlement, particularly if the first ‘reality check’ of the claims and counterclaims occurs, when it is too late, as appears to have happened in this case. Yet, this is precisely one of the problems which the 2017 Act seeks to address - by trying to ensure that a plaintiff only comes to court if she has first been through ‘reality check’ of mediation. In this way, the 2017 Act tries to ensure that a plaintiff’s claim has been subjected to an independent assessment by an objective mediator and thereby has received a reality check before it is too late. Indeed, one of the key benefits of mediation is that it is usually the first time that a litigant will have received an assessment of the flaws of their own claim and the merits of their opponent’s claim, not from someone on their own side and who is paid to fight their corner (their lawyer or other advisers), but from someone who is objective and completely independent. Up until then, litigants will often only hear what they want to hear from their own advisers (or, indeed, they may in some cases, choose advisers who tell them what they want to hear.)

27. Mediation therefore offers a great opportunity for a reality check regarding firstly the likelihood of a litigant’s claim being successful and secondly, even if it is, a reality check regarding the likelihood of a litigant obtaining anything close to the sums claimed. No reality check of mediation appears to have been applied to the claims in this case

28. In this case unfortunately, there was no mediation and so, it appears, no reality check of the claims, not just of the plaintiffs, but also of the defendant, by an independent and objective third party. It is a case where the plaintiffs’ claim was for circa $2.5 million, and the defendant’s counterclaim was for circa $1.8 million. The case was listed for an eight-day hearing commencing on 24th June, 2025, with costs estimated by the parties as likely to exceed €1 million. This was a case therefore was one which would have benefited from mediation/reality checking. This is highlighted by the fact that this Court has found that neither the plaintiffs, nor the defendant, are entitled to any award. As a result, the only winners in this case are the lawyers.

29. This case should therefore act as a salutary lesson for all plaintiffs, when they receive the advice to consider mediation instead of litigation (which the 2017 Act obliges their solicitor to provide to them), that they do seek to undergo the reality check of mediation. This is because the 2017 makes clear that litigation should be the option of last resort, rather than first resort, when it comes to resolving disputes.

BACKGROUND

30. The defendant (“Techads”) is an Irish incorporated company, based in the Dublin City University Alpha Campus. In just three years between 2018 and 2021, it went from having sales of €5.86 million to €119.81 million. Mr. Luca Ascani (“Mr. Ascani”), a consultant to Techads, gave evidence that at that time Techads was valued by Merrill Lynch at over $600 million.

31. However, in mid-2022, its business disappeared almost overnight, when it was blacklisted by its two main clients Ask Media Group LLC (“Ask”) and CBS Interactive, Inc. (“CBS”). Techads blames several parties, including the plaintiffs (“V Media” and “First Click”), for the fact that today, Techads exists solely for the purposes of this litigation.

32. Prior to these events, Techads’ business involved sourcing website traffic and then driving that web traffic to the websites of its two main clients Ask and CBS. In very general terms, this business involved Techads, through the use of agents (including V Media and First Click) seeking out individuals who were searching the internet to get them to click on links (e.g. paid advertisements on Google, Facebook etc.) which then led those individuals to the websites of Ask and CBS.

33. Each time a person clicked on the website of Ask or CBS, Techads received revenue from Ask or CBS, which it shared with agents, such as V Media and First Click (known as digital marketing agents). Techads entered agreements, known as digital marketing agreements with these digital marketing agents to source and direct web traffic to Techads’ clients, Ask and CBS.

34. Under the terms of these digital marketing agreements, Techads gave V Media and First Click 70%-80% of the revenue it received from Ask and CBS (while retaining 30%-20% itself). Techads received this revenue from Ask and CBS as a result of the web traffic directed to their websites by V Media and First Click.

35. Ask and CBS terminated their agreements with Techads in mid-2022 because of the ‘unusual’ nature of the web traffic provided to them on behalf of Techads by its several digital marketing agents (two of which were V Media and First Click).

36. The background to this ‘unusual’ web traffic is that, in very general terms, website owners, such as Ask and CBS, want internet users to click on their websites and by doing so spend money. Accordingly, website owners are happy to pay for such web traffic. However, they do not want to pay for robots clicking on their sites or indeed individuals clicking on their sites, who have no likelihood of spending money on the website (e.g. an individual based in Asia clicking on a site which offers say hairdressings services to residents of a State in the US). When issues like this arise Ask and CBS will clawback any revenues they have paid for, what is termed, ‘bad’ website traffic.

37. In this instance, Ask and CBS clawed back payments that they had made to Techads for web traffic directed to their websites by agents of Techads, because of the ‘unusual’ nature of that traffic. This clawback of revenue and the blacklisting of Techads (by Ask and CBS) had a dramatic effect on Techads’ business. Mr. Ascani described it as leading to ‘chaos’ in Techads and that it was like a ‘bomb going off’. As a result, Techads’ revenue went from €19,084,339 in May 2022 to just €878,615 in July 2022 and then to negative revenue of $12,963,299 in August 2022 (because of the outflow of funds due to the clawbacks).

38. Techads attributes this destruction of its business, as least in part, to the actions of V Media and First Click. This is because Techads says that some of the clawbacks made by Ask and CBS are attributable to the web traffic sourced and directed by V Media and First Click to Ask and CBS. Techads makes this claim because each ad campaign that is run by a digital marketing agent is given an AdUnit, which it says is an identification number attaching to the web traffic, which that digital marketing agent sources and directs to various websites. Techads claims that circa $1.8 million of the chargebacks, for the ‘unusual’ traffic, made by Ask and CBS relate to AdUnits, which are attributable to V Media and First Click. For this reason, Techads is seeking to recover, by way of counterclaim, from V Media and First Click $1.8 million in relation to these clawbacks.

39. The reason Techads’ claim is a counterclaim is because the primary claim in these proceedings is a claim by V Media and First Click, as plaintiffs, seeking payment from Techads for unpaid invoices. These invoices date from April, May and June of 2022 and relate to web traffic they sourced and directed to Ask and CBS, which invoices are in the sum of circa $2.5 million. However, Techads claims that it is not obliged to pay for any such web traffic because it says that both V Media and First Click breached the terms of their respective digital marketing agreements with Techads by sourcing web traffic from third parties, which were not pre-approved via email by Techads, as required under those agreements.

40. In summary therefore, V Media and First Click are claiming $2.5 million from Techads in unpaid invoices for web traffic, while Techads is claiming $1.8 million from V Media and First Click in relation to amounts clawed back by Ask and CBS from Techads in relation to payments made for web traffic.

The parties and the witnesses

41. V Media is a company registered in Montenegro and First Click is a company incorporated in the Abu Dhabi Free Zone. Both companies are owned by Mr. Veselin Terzic (“Mr. Terzic”), who is from Montenegro. He is also the CEO of both companies and their sole employee. He gave evidence on behalf of both V Media and First Click.

42. Mr. Ascani, who is from Italy, has expertise in digital marketing and was a consultant to Techads at the relevant time and he gave evidence on behalf of Techads. Mr. Carlo Petito (“Mr. Petito”), who is also from Italy, is a shareholder in Techads and at the relevant time, he was the CEO of Techads. He also gave evidence on behalf of Techads.

The agreements

43. V Media and First Click entered two separate Marketing Agent Agreements (each an “MAA”), one between Techads and V Media and the other between Techads and First Click. These MAAs are in almost identical terms. The MAA between Techads and V Media was signed on 8th November 2021 (albeit that it is incorrectly dated 1 February 2021) and the MAA between Techads and First Click is dated 1 January 2022.

44. Since the terms of the MAAs for both V Media and First Click are practically identical and since the claims made by V Media and First Click (against Techads), and the counterclaims against V Media and First Click (by Techads), are almost identical, for ease of reference, this judgment will refer henceforth solely to V Media. However, the conclusions reached in this judgment regarding V Media’s rights and obligations are equally applicable to First Click.

The MAA between Techads and V Media

45. Under the terms of the MAA between Techads and V Media, Techads agreed to pay V Media a proportion of the revenue received from Techads’ clients (referred to in the MAA as Techads’ Partner’s Sites) pursuant to the terms of the Payment Schedule in Exhibit A of the MAA. Initially, Techads paid 70% of this revenue to V Media and it subsequently increased this percentage to 80%.

46. The practice regarding invoicing under the MAA was that Techads would provide V Media with the sum it should invoice Techads. This sum depended on the amount of web traffic which was received by Techads’ clients, and which was attributable to the efforts of V Media. As previously noted, the amount of web traffic that was attributable to V Media was discernible by the use of AdUnits which indicated the source of the web traffic which landed on the clients’ websites.

47. The invoices issued by the plaintiffs dated April, May and June of 2022 (the “Invoices”) have not been paid by Techads. V Media claims that it is owed $2,030,842.62 under the terms of these Invoices. (For its part, First Click claims that it is owed $476,494.48 under the terms of the Invoices issued between in April, May and June 2022.)

48. The reason that Techads has not paid these Invoices is because it claims that V Media breached the MAA when it subcontracted its obligations under that agreement.

V Media subcontracted its obligations under MAA to third parties

49. The genesis of the dispute between the parties is that V Media subcontracted to various third parties, its obligation under the MAA to source and direct web traffic to Techads’ clients (Ask and CBS). In this regard, it is not in dispute that V Media appointed intermediaries/subcontractors whose identity was not known to Techads, to source and direct web traffic under the MAA to Ask and CBS. In this regard, Techads sought discovery from V Media, for it to provide: “A list of all the traffic sources providers, or relevant intermediaries, used by [V Media] in connection with services provided for [Techads]”. V Media replied as follows: “Traffic Source Providers:

• Outbrain

• Taboola

• Facebook

• Google Display Network

• MGID

• Adwords

Intermediaries (instructed by Plaintiffs to use only the above listed Traffic Source Providers in connection with services for the Defendant):

• CambridgeAds LLC

• Questa.com.au Pty Ltd

• A.P Ad Experts Media Ltd

• IntelliApt Technologies

• Udonis d.o.o

• ShowcaseIT Inc

• ExMarketPlace FZ LLC

• Doxaclick SL

• AEM Days Ltd

• SearchSoft Technologies”

50. It was only on receipt of this discovery on 11 December 2024, that Techads first became aware that these ten intermediaries listed above (“Subcontractors”) were the parties sourcing and driving the web traffic to Techads’ clients (Ask and CBS). This is not disputed by V Media.

51. Techads states that it did not give prior email approval to the use of these ten Subcontractors (despite the terms of the MAA requiring same, which are set out below), which is not denied by V Media. However, V Media claims that its subcontracting of the services under the MAA to the Subcontractors was not a breach of the MAA, since it claims that Techads knew that V Media was using subcontractors to provide the service under the MAA.

ANALYSIS

52. The first issue for consideration therefore is whether V Media is entitled to payment of the said Invoices in respect of the services which were provided to Techads’ clients by the Subcontractors, even though V Media did not have prior approval by email from Techads for the use of those Subcontractors, as required by the MAA? Is V Media entitled to payment or is Techads entitled to withhold payment?

53. Before considering this issue, it is relevant to note that neither of the parties referred to any caselaw during their oral submissions. This is understandable since the issues to be resolved are primarily ones of fact (e.g. did Techads approve the use of any or all of the Subcontractors) and not ones of law.

54. However, reference was made in V Media’s written submissions to the leading case on contractual interpretation, Analog Devices v. Zurich [2005] 1 IR 274 (“Analog Devices”). From that case, it is clear that in interpreting the MAA, to decide whether it has been breached, this Court’s task is to give effect to the intention of the parties. Analog Devices makes clear that this intention is to be ascertained objectively from the words used in the document, while taking into account the surrounding circumstances or factual matrix.

55. Therefore, in deciding whether there has been a breach of MAA by V Media, such that Techads is entitled to withhold payment for the Invoices, consideration must be given to the surrounding circumstances or factual matrix. In this regard, there are two aspects of the factual matrix of the MAA which are particularly relevant.

Emphasis on services under MAA being provided by V Media

56. The first relates to the emphasis placed on the services under the MAA being provided by the ‘Agent’, which is defined as meaning V Media. This emphasis is relevant because Techads claims that V Media breached the MAA by not providing the services itself, but by subcontracting them to unapproved subcontractors. The first reference to this issue is in the Recitals of the MAA, which state:

“WHEREAS, TechAdsMedia entered into agreement with multiple online companies (“TechAdsMedia’s Partners”) in order to drive traffic to their web properties (“TechAdsMedia Partner Site(s)”); and WHEREAS, TechAdsMedia wishes to outsource certain web marketing services to Agent [V Media] as set forth below in this Agreement and Agent [V Media] wishes to perform such services, subject to the terms and conditions of this Agreement.” (Emphasis added) The Recitals therefore make clear that V Media is to provide the services (i.e. to source and drive web traffic to the websites of clients of Techads).

57. However, in the operative part of the MAA, there are seven separate provisions which reinforce that those services are to be provided by V Media: “1.3 “Agent Services” means the provision of search, social, native, or more standard display marketing services provided by Agent [V Media] to TechAdsMedia under this Agreement, in all cases designed to drive traffic to TechAdsMedia’s Partner Sites. (Emphasis added)

1.4 “Authorized Network(s)” means those specific web advertising networks approved by TechAdsMedia in writing from which Agent [V Media] may purchase placements of Ads on websites that are not owned or controlled by TechAdsMedia or any of its Affiliates. TechAdsMedia may add or remove any Authorized Network from this Agreement upon written notice to Agent. All current approved advertising networks are listed within the agreed compliance schedule.

[….]

2. Agent Services. Commencing on the Effective Date, Agent [V Media] shall commence performance of the Agent Services as provided in and in conformance with the requirements and restrictions of this Agreement.

[…]

8.2 Agent Warranties. Agent hereby represents and warrants that: (i) it [V Media] will perform the Agent Services in a professional and workmanlike manner consistent with the highest industry standards, applicable laws, and the Integration and Compliance Schedule [...] Exhibit A Payment Schedule

1. Fees. In full consideration of Agent’s [ V Media’s] provision of Agent Services, TechAdsMedia will pay agent during the Term a monthly Revenue Share and may pay Agent. Such Revenue Share granted shall be paid in USD.

[…]

Marketing Agency Agreement

Compliance Schedule

As an Agent of TECHADSMEDIA, and licensor of TECHADSMEDIA and its partners’ brands, you [V Media] have a responsibility to TECHADSMEDIA to ensure that TECHADSMEDIA [….] You [V Media] shall promptly provide to TECHADSMEDIA any information requested by TECHADSMEDIA useful or necessary to verify your compliance with this Compliance Schedule […] Paragraph 1 of the Compliance Schedule “1. Approved Campaigns and Networks You [V Media] may only drive traffic to the TECHADSMEDIA and its partners’ Websites via Authorized Ads/Campaigns as selected in Section 1 of your Agreement. Any advertisements purchased or displayed outside of the networks specified as Authorized Ads/Campaigns are in breach of this Compliance Schedule.

• For SEM Authorized Ads/Campaigns, the approved networks shall be Google Adwords, and Microsoft Advertising.

• For Social Media Authorized Ads/Campaigns, the approved network shall be Facebook Business.

• For Native Authorized Ads/Campaigns, the approved network shall be Outbrain and Taboola.

• For Displayed Authorized Ads/Campaigns, the approved network shall be Google Display Network (GDN). Purchasing of ads with any network or publisher not listed above must be preapproved via email from an authorized representative of TECHADSMEDIA.” (Emphasis added) It is clear from the foregoing extracts that there is a very clear emphasis in the MAA on the services (i.e. the sourcing and directing of web traffic) being provided by V Media.

58. Indeed, in its Statement of Claim, V Media emphasises that it was engaged to provide the services, since it states that: “The Defendant wished to outsource certain web marketing services to the Plaintiffs, and the Plaintiffs wished to provide those services. The Marketing Agent Agreements served those ends. The Defendant provided web traffic to certain internet platform providers, termed ‘Partners’ of the Defendant. The Defendant engaged various parties, to include the Plaintiffs, to provide this traffic to its partners.” (Emphasis added).

59. Similarly, when asked, in the Notice for Particulars dated 7th February 2023 for details of the ‘web marketing services actually provided’, V Media replied that ‘[V Media/First Click] provided the services specified in the Marketing Agent Agreements’.

60. The only possible involvement of third parties in the provision of the services (other than the six approved networks (“Six Approved Networks”) which are set out in para. 1 of the Compliance Schedule above) arises, where under that paragraph, a ‘network or publisher’, other than the Six Approved Networks, is used by V Media. However, this is stated only to be permitted if that network or publisher is pre-approved by Techads and if that approval is in writing (since it must be by email). This condition is not disputed by V Media, since in its Amended Reply to Defence and Counterclaim dated 31st March 2023, V Media states at para. 6 that ‘where Intermediaries were going to be used by [V Media/First Click], prior approval of the said Intermediaries was required’

(i) Importance of internet traffic coming from approved networks

61. The second and much more significant surrounding circumstance/factual matrix relevant to the interpretation of the MAA (and the alleged breach of its terms) are the references to the web traffic (which was being procured by V Media). In particular, it is the emphasis in the MAA on the web traffic being of the requisite quality and so coming from an approved network i.e. only from the Six Approved Networks (or a network or publisher pre-approved by Techads in writing).

62. This is clear from the fact that the MAA repeats and emphasises in eight separate provisions of the MAA the requirement that web traffic be from only approved sources.

63. Firstly, para. 1 of the Compliance Schedule of the MAA makes it clear that V Media may ‘only’ drive traffic to Techads’ clients’ websites ‘via’ the Six Approved Networks.

64. Secondly, this point is reinforced in that same paragraph, as it is expressly states that advertisements which do not use the Six Approved Networks are in breach of the MAA.

65. Thirdly, the point is emphasised once again in that same paragraph, since it provides that if any other networks are to be used, this requires prior approval by email from Techads.

66. Fourthly, para. 1.2 of the Payment Schedule of the MAA further emphasises the point by providing: “1.2. Notwithstanding anything to the contrary set forth herein, TechAdsMedia shall not be obligated to remit payment for (and shall be entitled to a refund with respect to): […] (b) any revenues generated through an implementation and/or marketing practice which is not approved by TechAdsMedia pursuant to this Agreement or subsequently fails to meet the requirements and specifications set forth in this Agreement […] (Emphasis added). It seems clear to this Court, that the ‘marketing practice’ at issue in this clause is the acquisition of web traffic by V Media and driving it to Techads’ clients (and V Media did not seek to argue otherwise). Therefore, the reference in this paragraph to the acquisition of web users from sources, that were not approved by Techads, is yet another reference to the prohibition on the use of networks other than the Six Approved Networks (or other sources pre-approved by Techads). In this way, this paragraph provides that no payment will be made for traffic sourced from outside the Six Approved Networks (or ones not approved by email).

67. Fifthly, para. 2 of the Payment Schedule of the MAA provides for a right to withhold payment and a right of set off, where an unapproved network is used, since it states: “TechAdsMedia reserves the right to withhold and offset against its payment obligations hereunder, or require Agent to refund to TechAdsMedia within forty-five

(45) days of any invoice, any amounts that:

• TechAdsMedia has overpaid or otherwise inappropriately paid to Agent in prior periods

• The Agent has generated by using Networks that are not listed in the agreed Compliance Schedule as per the clause 1.4. [….”] (Emphasis added)

68. Sixthly, the opening paragraph of the Compliance Schedule sets out the importance of Techads not being negatively impacted by V Media’s sourcing of internet traffic and in this way the importance of compliance with the Compliance Schedule (i.e. to use only approved networks): “As an Agent of TECHADSMEDIA, and licensor of TECHADSMEDIA and its partners’ brands, you have a responsibility to TECHADSMEDIA to ensure that TECHADSMEDIA and its partner brands and image and reputation, including its web properties and brands, are not negatively impacted by your actions or by our association with you. All your activities relating to your advertising campaigns to drive traffic to TECHADSMEDIA and its partners Websites must comply with the requirements and restrictions set forth in this Compliance Schedule and other ethical standards commonly adopted by reputable actors engaged in performance marketing.” (Emphasis added)

69. Seventhly, para. 2 of the Compliance Schedule emphasises that the obligation is upon V Media to monitor and disable any advertising campaign that does not comply with the requirements of the Compliance Schedule (i.e. to use only approved networks): “You [V Media] are responsible for monitoring your campaigns and immediately disabling any campaign or other action by your staff or agents that are not in compliance with this Compliance Schedule. TECHADSMEDIA may demand that you partially or fully cease all promotion activities in the event of a breach of the requirements of this Compliance Schedule, until TECHADSMEDIA has received sufficient assurance, in TECHADSMEDIA’s sole discretion, that any implementation issue has been fully remedied. You shall promptly provide to TECHADSMEDIA any information requested by TECHADSMEDIA useful or necessary to verify your compliance with this Compliance Schedule.” (Emphasis added)

70. Finally, para. 4 of the Compliance Schedule of the MAA emphasises yet again the fact that V Media is not allowed to use unapproved sources of internet traffic.

“4. No Distribution of Ads via Unauthorized Channels

[…]‘Agencies are not allowed to resell the feed unless they are officially approved by Techads team after disclosing the network of partners, their traffic sources and any additional information that will be required’.” (Emphasis added)

Summary of the factual matrix surrounding the MAA

71. Therefore, when this Court, in line with the Analog Devices case, is interpreting the intention of the parties from the wording of the contract, it is clear that there is a huge emphasis in the MAA on using only the Six Approved Networks to source traffic (or only networks/publishers pre-approved by email by Techads). This factual matrix could hardly be clearer from the wording of the MAA and so this reflects, in this Court’s view, the objectively ascertained intention of the parties from the wording of their contract.

72. It is also of some relevance that there is an emphasis on the fact that V Media itself, as distinct from any third party, was to provide the service, i.e. source and direct the web traffic (albeit that there was a provision for pre-approval by email of third-party sources).

73. Accordingly, when this Court is considering, as it will do next, whether V Media breached the MAA by using the Subcontractors to source the internet traffic under the MAA, such that Techads is not obliged to pay the Invoices, the MAA must be interpreted in light of this background factual matrix. Breach of paragraph 1 of the Compliance Schedule?

74. The paragraph of the MAA, which is key to determining whether there has been a breach by V Media of its terms, is para. 1 of the Compliance Schedule. This states: “Purchasing of ads with any network or publisher not listed above [i.e. the Six Approved Networks] must be pre-approved via email from an authorized representative of TECHADSMEDIA.” (Emphasis added)

75. As a preliminary point, it seems clear from the factual matrix, to which reference has already been made, that the reason why Techads specified that this authorisation must be pre-approved, and must be by email, is because of the importance which Techads attached to the quality of the web traffic. In particular, this was because of the importance which Techads attached to ensuring that it was happy with any sources of web traffic (if ones other than the Six Approved Networks were to be used). This is because it did not want to be ‘negatively impacted’ by unapproved sources (or for its clients to be so impacted). It seems clear that this is why Techads provided in the MAA that any subcontractors used by V Media:

• had to be approved in advance (and so it was not sufficient to approve them retrospectively), and

• that, in order to ensure that there would be no doubt if such approval was given or not, the approval had be given in writing (and so it was not sufficient for it to be given orally).

76. It also seems clear from the factual matrix that the reason for this level of care about approval of subcontractors was because a lot of money was riding on the quality of the web traffic, as evidenced by the dramatic collapse in revenues when web traffic was not up to the standard required by Ask and CBS. Indeed, any negative impact was going to be, not just financially significant, but also existential for Techads (which was exactly what happened).

77. When it comes to the interpretation of the MAA, it is relevant to note that it is not just the wording of the MAA, but also how the MAA was actually performed, which is consistent with the view that the identity of the sources of web traffic was of considerable importance to Techads.

78. This is because when it came to performing the contract, Techads also showed that the approval of third party sources of internet traffic (other than the Six Approved Networks) was something which it took seriously. This is because when Techads was provided by V Media with the very first proposed third party source of web traffic to be approved under the MAA (a website called snotr.com), it is clear that the identity of that third party source was important to Techads. This is because Techads did not simply approve that source. Instead, it clearly took this approval process seriously, since Techads refused to approve that third party.

79. This fact is also important background to what happened next. This is because, despite the emphasis in the MAA on V Media providing the services itself and on using pre-approved sources of web traffic, and despite Techads making it clear to V Media that snotr.com was not suitable to be approved as a source of web traffic:

• V Media, from the word go, never provided any of the internet traffic itself, but operated as a middleman, and

• more importantly, after snotr.com was not approved, V Media never sought approval in advance, even orally, let alone by email, from Techads of the appointment of any of the sources of web traffic (i.e. the Subcontractors) it appointed.

80. None of this is in dispute, since Mr. Terzic accepted under cross examination that V Media did not get any pre-approval by email from Techads to the use of any of the Subcontractors (Transcript, day 2, p. 22, line 25).

81. In addition, on V Media’s own case, the reference to ‘publishers’ in para. 1 of the Compliance Schedule includes a reference to intermediaries/subcontractors. Accordingly, it is also not in dispute that if V Media was using the ten Subcontractors to source and direct web traffic to Techads’ clients, as it was, this required the prior consent by email of Techads under that paragraph, which it never obtained.

82. V Media therefore prima facie breached the terms of para. 1 of the Compliance Schedule. Is V Media not in breach of MAA, despite not getting prior email approval?

83. Although it did not receive prior email approval for its use of the ten Subcontractors, V Media nonetheless claims that it is not in breach of the MAA. V Media’s claim appears to be based on the view that Techads approved of the use of the Subcontractors, other than by email.

84. However, for Techads to approve the use by V Media of a subcontractor (say subcontractor X) to provide the web traffic, Techads would need to be provided with the identity of subcontractor X, just as it was provided with the identity of snotr.com, as a potential source of web traffic. This raises the question of whether the identity of the ten Subcontractors was provided by V Media to Techads? Was identity of any source of web traffic provided to Techads?

85. It is perhaps not surprising that V Media would claim that it provided Techads with the identity of its subcontractors. This is because it is difficult to see how V Media could have any case that Techads had approved a subcontractor, if Techads was not provided with the identity of that subcontractor.

86. Thus, in its Replies to Notice for Further and Better Particulars dated 4 December 2024, V Media stated that the approval of the Subcontractors was provided by Techads, since V Media had inserted certain information on a Google spreadsheet (“Google Spreadsheet”) regarding the digital marketing campaign, which was duly approved by Techads. Crucially, in the reply to the question on how the approval was given by Techads to the use of the Subcontractors, V Media went on to state that: “The information supplied via the Google spreadsheets included the identity of external publishers/partners (i.e. intermediaries).” (Emphasis added)

87. If this reply is correct regarding the contents of the Google Spreadsheet, which was completed by V Media for Techads, then V Media could legitimately claim that Techads knew about its use of the Subcontractors. In particular, it could claim that by approving the advertising campaign, based on this Google Spreadsheet, to be carried out by the thirdparty sources of web traffic (the Subcontractors), Techads could be said to have approved those Subcontractors. This argument would be entirely logical, since it was the insertion of ‘snotr.com’ in this very same Google Spreadsheet that led to Techads not approving snotr.com as an approved third-party source of web traffic. Clearly therefore, if Techads had chosen not to object to the ten Subcontractors also listed on the Google Spreadsheet, but only to object to snotr.com, then it could be said to have approved those ten Subcontractors.

False Replies to Particulars provided by Mr. Terzic

88. However, the problem for V Media is that it never included the identity of any of the ten Subcontractors in the Google Spreadsheet. Accordingly, this Reply to Particulars, provided by Mr Terzic, is patently false. Indeed, Mr. Terzic accepted under cross examination that this Reply was false as he accepted that he did not include the identities of the Subcontractors in the Spreadsheet (Transcript, day 2, p. 35, line 13).

89. Indeed, he went further, since he stated that he deliberately chose not to disclose the identity of any of the Subcontractors to Techads in order to protect his business, even though this was in direct breach of the terms of the MAA, which he had signed on behalf of V Media.

90. He stated that this was because he was afraid that if Techads discovered the identity of the Subcontractors, Techads might start doing business directly with them, and thereby cut-out V Media as a middleman. Of course, another threat to his business (but one he did not state in his evidence) was the fact that if V Media had disclosed the ten Subcontractors to Techads, in the same way as it had disclosed snotr.com to Techads, and if Techads did not approve any of these ten Subcontractors, just as it had failed to approve snotr.com, then V Media would have no business with Techads.

91. In any event, a key factor in the question of whether V Media is entitled to payment for the Invoices is the fact that from the word go, V Media deliberately chose to breach the terms of the MAA for its own business purposes, by not disclosing the existence or the identity of the ten Subcontractors. Misleading and disingenuous response by V Media to Techads’ letter of 11 July, 2022

92. With the benefit of this evidence from Mr. Terzic, one can look much more critically at the response of V Media to Techads’ request for information regarding V Media’s sources of web traffic. In particular, this Court now knows that Mr. Terzic deliberately did not disclose (until discovery in these proceedings) the existence and identity of the ten Subcontractors, despite the clear importance in the MAA which is attached to the quality of the sources of web traffic and their approval by Techads.

93. Then on 11 July 2022, V Media received a letter from Techads, signed by its director, Mr. Franco Simion’s (“Mr. Simion”). In considering Mr. Terzic’s response to this letter, it is important to remember that this letter was sent to Mr. Terzic after (to quote Mr. Ascani) the ‘bomb had gone off’ in Techads, i.e. after it had been blacklisted by clients who were the source of practically all of Techads’ business. In Mr Ascani’s words, it was ‘chaos’ in Techads as the staff tried to get to the root of the problem of the ‘unusual’ web traffic in order to try and save the business. It is in this context, that Mr. Simion wrote to Mr. Terzic outlining the gravity of the situation facing Techads’ business and seeking Mr. Terzic’s assistance, in the following terms:

“Dear Mr. Veselin Terzic,

As from 21 June 2022 our business has been seriously disrupted due to third party allegations of unusual user behaviour and use of unapproved networks linked directly to our engagement with V Media DOO. It therefore appears clear is that there has been a breach of the Marketing Agent Agreement dated 08.11.2021 entered into between TechAds Media Ltd and V Media DOO (the ‘Agreement’). Further, it would appear to be directly referable to a breach by V Media DOO of the requirements and restrictions set forth in the Implementation and Compliance Schedule as attached to the Agreement.

Whilst the TechAds Media Ltd was only made aware of the unusual user behaviour and unapproved networks on or about 21 June 2022, it would appear reasonable to assume that such behaviour has been ongoing for some-time and we are investigating this further. The direct impact of such unusual user behaviour and unapproved networks used is that the Company is encountering significant ongoing commercial difficulties having been blacklisted by third parties. As you are aware, all traffic has been paused. Please send us the following information urgently:

1. Exact traffic sources used until now

2. Screenshot of ads promoted including the final URLs

3. Screenshot of the campaigns on each traffic source

You might note that we hold V Media DOO liable for all loss and damage incurred as a result of its breach of various terms and conditions in the Agreement and this is formal Notice pursuant to clause 6 of the Agreement as applicable specifically to a breach of the Implementation and Compliance Schedule. You should also take careful note of the Agreement Indemnification Clause which applies to any third-party claims that may arise and which the Company will be relying on.” (Emphasis added)

94. At this stage therefore, the use of unapproved subcontractors by V Media was front and centre as the apparent cause of the serious disruption to Techads’ business. Accordingly, Techads was seeking the assistance of V Media to try to save its business by finding out the exact source of the web traffic. In addition, it is important to note that para. 2 of the Compliance Schedule of the MAA puts the following obligation on V Media:

“You [V Media] shall promptly provide to TechAdsMedia any information requested by TechAdsMedia useful or necessary to verify your compliance with this Compliance Schedule.”

95. Against this background, it is also important to bear in mind that Mr. Terzic knew, when he received this letter, that he had ten unapproved Subcontractors who have provided web traffic to Ask and CBS, on behalf of Techads, which fact, up to this point, he deliberately did not disclose to Techads for V Media’s own business reasons. He is also aware of the importance which the MAA attaches to the quality of the sources of the web traffic and the importance of them being approved by Techads.

96. Despite all of this, instead of coming clean and providing Mr. Simion with the identity of the ten Subcontractors to enable Techads get to the bottom of the source of web traffic and try and save its business, Mr. Terzic continued to conceal his use, and the identity of the Subcontractors. Instead, in reply to this letter, Mr. Terzic sent an email on 13 July 2022 stating:

“Hello,

I am sending screenshots for Outbrain and GDN that we already approved with your team on my company First Click Marketing Operations Management before getting agreement and links:

https://prnt.sc/DCkRhCd9fQgd

I am not getting any answers from your on email and Skype for many days, so tell me if its the info you asked me for. If you see anywheresearch.com domain as referral its my tracking domain and you should see it on all my traffic.” (Emphasis added)

97. Thus, it is important to note that, in reply to the request for information on any unapproved sources of web traffic, which might have caused chaos to Techads’ business, Mr. Terzic sent two screenshots from Outbrain and Google Display Network (GDN), which were two of the approved networks listed in the MAA, rather than any of the ten unapproved and non-disclosed Subcontractors which he was using.

98. To say that this was disingenuous would be a considerable understatement. This was a deliberate misrepresentation by omission by Mr. Terzic, since he chose once again (but now at a time when it knew how serious this issue was for Techads) not to disclose the identity of the Subcontractors and instead give the impression that V Media only used approved sources for internet traffic.

99. This amounted to a second breach of the MAA by V Media (in this case a breach of the obligation in para. 2 of the Compliance Schedule to provide information to Techads to verify compliance with the Compliance Schedule).

100. In light of this response, which Mr Petito understandably described in his evidence to this Court as ‘a joke’, it was not surprising that the next communication of any significance between the parties was the letter of 15 September 2022, in which Techads terminated the MAA:

“Dear Mr. Veselin Terzic

We refer to the Marketing Agent Agreement between us dated 08/11/2021 (the “Agreement”). We refer to our previous communications where we notified you of your breaches of the provisions of the Implementation & Compliance Schedule of the Agreement and in particular of your failure to ensure that all internet traffic that you drove to our partners’ sites was valid and approved. This letter constitutes a notice pursuant to clause 6.2(b)(i) of the Agreement that we are terminating the Agreement on the grounds of your failure to cure the above breaches within 3 days.

Please note that termination of the Agreement does not act as a waiver of any rights by either party under the Agreement, all of which are expressly reserved, including any other termination rights, or affect any obligations which may, by their nature, or due to the express requirements of the Agreement, survive termination. In particular, you should note that we are continuing to assess the consequences of your breaches, including the financial and reputational damages suffered as a result. We will revert in this regard in due course.” Did Techads approve the use of the Subcontractors in some other manner?

101. While it is clear from the foregoing that V Media breached the terms of the MAA, V Media nonetheless claims that the condition (that prior email approval be given of any sources of web traffic other than the Six Approved Networks) was satisfied because Techads actually knew that V Media was using subcontractors.

102. In this regard, particular reliance is placed by V Media on the fact that, prior to the execution of the MAA, there is a Skype message from Techads referencing the use of subcontractors by V Media. This message is sent by Mr. Petito to Mr. Terzic (who is referred to as Vesko) and it states: Mr. Petito: “Hey @Vesko please meet Alberto and Nathalia here that will take over. Vesko is part of WeMonetize and they have large network of agencies. So it would be part of the agencies reselling our feed and we will have to ask for all the information about each partner before starting. They are already working with other companies reselling them our feed apparently.” (Emphasis added)

This message is immediately followed by the following exchange: Mr. Terzic:

“Hey Carlo

Thanks for intro

I sent you samples of our biggest pub. Did you have a chance to check it?” Mr. Petito: “That is good, but we will need that for each publisher. We will need to know each publisher what sources use and some ads examples. As we will have to approve your publisher one by one for testing" (Emphasis added)

103. The first difficulty with reliance being placed by V Media on these messages (which were sent on or prior to 2 November 2021), in order to claim that Techads had somehow approved the ten Subcontractors for the purposes of para. 1 of the Compliance Schedule, is that it is being made in the teeth of an ‘entire agreement’ clause of the MAA (which was signed on 8 November 2021). This clause clearly states that any written communications (thus, including these S messages) are superseded by the terms of the MAA: “11.12 Complete Agreement, Waiver, and Modification. The parties agree that this Agreement and the attached exhibits, which are incorporated into this Agreement by this reference, constitute the complete and exclusive statement of the mutual understanding of the parties, and supersede and cancel all previous written and oral agreements and communications relating to the subject matter of this Agreement. For the avoidance of doubt, no terms of use/service, terms and conditions, privacy policy or other policies or guidelines (collectively hereinafter, the “Agent Standard Terms”) made available by Agent to TechAdsMedia before or after the Effective Date shall be applicable. No waiver, modification or amendment of any provision of this Agreement will be binding against a party unless it is in writing and signed by a duly authorized representative of such party. No such waiver of a breach hereof will be deemed to constitute a waiver of any other breach, whether of a similar or dissimilar nature.” (Emphasis added)

104. Thus, under the express terms of the entire agreement clause, these earlier Skype messages, referencing V Media’s use of subcontractors, are superseded by the requirement in the MAA that pre-approval by email be provided for the use of any subcontractors, i.e. any sources of web traffic (other than the Six Approved Networks).

105. In any event, at its height, this first message from Mr. Petito means that Techads understood that V Media may be using subcontractors for the services. However, this very same message makes it clear that, even if this is the case, Techads will have to ask for ‘all information about each partner before starting’. Furthermore, Mr. Petito makes it clear in his second message on the same day that Techads will have to ‘approve your publisher one by one for testing’. Since, on V Media’s own case, ‘publisher’ means subcontractor/intermediary, it follows that this Skype exchange could never mean, what V Media wants it to mean, namely that Techads was happy for V Media to use subcontractors without any approval from Techads regarding their identity.

106. In any case, this first Skype message cannot be read in isolation from all the other messages between the parties and there are several other later messages sent after the MAA is signed, which make it very clear that the pre-approval by Techads of any subcontractors used by V Media (contained in para. 1 of the Compliance Schedule) remains something which is required by Techads.

107. The first arises in the context of the refusal of the approval of Techads for snotr.com, to which reference has already been made. This is the Skype message exchange between Mr. Terzic and Mr. Petito on 16 November 2022 and it makes clear that Techads requires very specific information on the sources of web traffic in order to approve them (which is in line with para. 1 of the Compliance Schedule): Mr. Petito: “Also the partner is the same (snotr.com) doing all those sources, or they are different partners? We need to specify the partner and for each partner what are the sources.” Mr. Terzic: “I sent more samples from that source. I did compilance [sic] with them long ago and now just asked for more samples about traffic they run with me and why we see many sites About networks. most of pubs buying build their own systems or using platform like ad kernel to buy from all available sources like richpush, propelier, adcash etc” Mr. Petito: “Unfortunately we can’t approve anything in this way. It’s too much generic We need to be very specific on the exact sources for each partner otherwise we can’t approve” Mr. Terzic: “Ok I will try to split traffic by specific source. Because I gave them one ID in my system and they started to grow everything that converts Can we start those outbrain campaigns first? I will pause this generic and run outbrain on another channel”

Mr. Petito: “Who is the partner using outbrain?” Mr. Terzic: “Its the same partner who run all this traffic , but we sent it to same channel. I will ask now to diversify sources and provide me detailed samples for each channel. Maybe first pause all mixed traffic and run outbrain on new channel and ask him about push sources before he can run them?” (Emphasis added) Thus, there is an emphasis placed by Techads, once again, in these messages on it giving its approval to third party sources of web traffic.

108. In another message, V Media deliberately represented that it was sourcing the web traffic only from the Six Approved Networks. This representation runs completely counter to V Media’s claim in these proceedings that somehow Techads knew that it was using the Subcontractors. Thus, in the following Skype exchange between Ms. Judit Farkas-Széki (“Ms. Farkas-Széki”), an employee of Techads, and Mr. Terzic on 11 May 2022, it is clear that V Media is stating that it was directly acquiring internet traffic itself, and so not using subcontractors/intermediaries: Ms. Farkas-Széki: “Hi @Vesko, hope you’re doing well. Could you please provide a quick update on the list of traffic sources used for V Media (Taboola, Outbrain etc)?” It is to be noted that Ms. Farkas-Széki is specifically referencing two of the Six Approved Networks. The exchange continues: Mr. Terzic:

“hey

I submited [sic] sources already for v media and use entity

You can find it in sheet. we did it on begin of our biz” Ms. Farkas-Széki: “So no new sources have been added since, you’re still only using Outbrain, MGID, and Adwords correct? Mr. Terzic: “Right” (Emphasis added). Thus, once again, Mr. Terzic’s reply is deliberately misleading since he does not disclose the existence of the traffic sources, i.e. the ten Subcontractors, when asked, and then when it is put to him that V Media is only using some of the Six Approved Networks, he falsely says ‘right’ to this suggestion.

109. The claim therefore by Mr. Terzic that Techads actually knew and consented to his use of the ten Subcontractors is impossible to square with this exchange, as it is with his previous misrepresentation to Mr Simion on 11 July (when he failed to disclose the Subcontractors when asked).

110. V Media relies on the fact that under cross examination Mr. Petito accepted that his Skype message (on or prior to 2 November 2021), that V Media was ‘part of the agencies reselling our feed’, was an acknowledgment that V Media was using subcontractors. However, in the very same exchange Mr. Petito stated Techads would have to ‘ask for all the information about each partner before starting’ and that Techads would have ‘to approve your publisher one by one for testing’. Thus, at all times, it is made clear by Mr. Petito that for whatever subcontractors V Media use, approval is required, in order to ensure the quality of that web traffic. Accordingly, this acknowledgement under cross examination by Mr. Petito of what one Skype message meant, cannot be taken in isolation from all the other messages and more particularly from the express wording of the MAA. Accordingly, this does not amount to sufficient evidence that V Media satisfied para. 1 of the Compliance Schedule (requiring pre-approval by email of the use of named/identified subcontractors) or that there was a waiver of those terms.

111. In addition, of course, this evidence of Mr. Petito cannot be taken in isolation from the rest of his evidence. For example, Mr. Petito gave uncontradicted evidence that he had no idea that V Media was in fact acting solely as a middleman and that he had no idea that V Media did not source any of the web traffic itself. He also gave uncontradicted evidence that Techads did not work with middlemen and if Techads had known V Media was acting solely as a middleman, Techads would have a completely different agreement with it, based on a commission rate of 5% rather than 80%.

112. The weight of the evidence therefore is such that even if Techads thought that V Media might be using some third party sources of traffic (other than the Six Approved Networks) it contractually required (and continued to require, as is clear from its messages) that any such subcontractors be identified and approved, in order to ensure that the traffic was of the requisite quality. There is little by way of evidence to say that Techads knew that V Media was using the ten Subcontractors or that Techads had waived the requirement for its approval to their appointment. Did Techads approve the Subcontractors by approving the Google Spreadsheet?

113. The Google Spreadsheet, to which reference has already been made, was the document to be filled in by V Media and provided to Techads, to enable Techads approve the advertising campaigns, which were to generate web traffic for Ask and CBS. This document reads as follows:

114. In particular, it will be noted from the second line of that spreadsheet, containing the instructions on its completion, that Techads is seeking from V Media “further details about partners *traffic sources by partner* at least one example (screenshot) of ad creative for each partner and traffic source* at least one example of ID/Campname for each partner and traffic source (when live)” (Emphasis in original)

115. In this regard, on November 10 2021, there was the following Skype message exchange between Ms. Nathália Cristina Da Silva (“Ms. Da Silva”) of Techads and Mr. Terzic regarding the completion by V Media of this Google Spreadsheet: Mr. Terzic: “Can you tell me what we should write under campname /id?” Nathalia:

“Hi @Vesko

For now you can fill out just the traffic source and add one ad creative example per source The URLs contain a “campname” parameter that you can choose. It can be a keyword, ID etc.” (Emphasis added)

116. Therefore, it could not be clearer from both the wording of the Google Spreadsheet and Ms. Silva’s message that Techads wanted not just details of the ad campaigns i.e. screenshots etc, but it also wanted to have details of the third party traffic sources or partners.

117. It is also relevant to note that it is this very same document which was used by V Media to identify to Techads a potential partner/source of web traffic (snotr.com) and which partner, Techads refused to approve.

118. For this reason, in the column headed ‘status’, there is the letter ‘U’ opposite snotr.com’s name, representing the fact that it was ‘unapproved’ by Techads as a source of web traffic. In contrast, the letter ‘A’ indicates that the advertising campaigns opposite that letter were approved.

119. V Media claims that the approval by Techads of the advertising campaigns, which this Court now knows were based on internet traffic sourced from the Subcontractors, meant that Techads approved the use of those Subcontractors. On this basis, V Media claims that there has not been a breach of para. 1 of the Compliance Schedule, since it says that the ten Subcontractors were therefore pre-approved by Techads. This claim is unsustainable for a number of reasons.

120. Firstly, para. 1 of the Compliance Schedule requires the approval of publishers/networks (i.e. the sources of the web traffic). Accordingly, the approval by Techads of an advertising campaign (e.g. screenshots of the type of advertising to be used) is not the same as approving the third party, which is providing the web traffic resulting from that campaign.

121. Secondly, as previously noted, it is not possible for a partner/subcontractor to be approved, if it is not identified or disclosed. Crucially, V Media in seeking the approval of the advertising campaign deliberately left the column for ‘partner’ in this Google Spreadsheet completely blank. This was where the ten Subcontractors should have been listed. We know that V Media failed to complete this column for its own business reasons and it achieved this purpose, since Techads never knew that ten subcontractors were being used by V Media or their identity.

122. Accordingly, it cannot be the case that, as claimed by V Media, Techads gave preapproval to partners, if their existence and identity were deliberately concealed from it. Indeed, the contrary is the position, namely because the ‘partner’ column was left blank, the only logical conclusion for Techads to reach was that V Media was not using partners/subcontractors in these ad campaigns and so it was sourcing the web traffic itself. The approval of this Google Spreadsheet could not therefore amount to V Media complying with the requirement for pre-approval of subcontractors under para. 1 of the Compliance Schedule, as claimed by V Media.

123. Having concluded that V Media did not comply with the terms of the MAA regarding its use of the Subcontractors, either by the use of the Google Spreadsheet or otherwise, the next step is to consider whether this means that Techads does not have to pay the Invoices. Is Techads contractually entitled to withhold payment of the Invoices?

124. Clause 1.2 of the Payment Schedule of the MAA (which is set out, more fully, above) provides that Techads shall not be obliged to pay V Media:

”any revenues generated through an implementation and/or marketing practice which is not approved by TechAdsMedia”. It seems clear to this Court that the marketing practice pursued by V Media, which was the deliberate use of the Subcontractors without the prior approval by email of Techads, failed to comply with the requirements of the MAA, and in particular para. 1 of the Compliance Schedule. Indeed, since V Media sourced no web traffic itself, but only used these unapproved Subcontractors, this means that all of the revenue which forms the basis of the Invoices was generated by marketing practices not approved by Techads.

125. It follows that, pursuant to clause 1.2 of the Payment Schedule of the MAA, Techads is not obliged to pay those Invoices for this unapproved marketing practice.

The counterclaim by Techads against the plaintiffs

126. A separate issue is whether Techads is entitled to judgment against V Media for the money that Techads says it had to repay to Ask and CBS, namely the money which was clawed back by those companies from Techads. This counterclaim rests on the provisions of clause 10.1 of the MAA, which, insofar as relevant, states: “Each party agrees to indemnify, defend and hold the other party harmless from and against any and all liability, loss, damage, claim, cause of action or other cost (including, without limitation, reasonable legal fees and expenses) (collectively, “Losses”), arising out of or related to any third-party claim arising out of the indemnifying party’s breach of its representations or warranties under this Agreement.” (Emphasis added)

127. It is clear from this wording that for Techads to succeed in its counterclaim against V Media, it must establish to this Court that the amount of financial loss which it is claiming (a sum in excess of $1 million) was caused by V Media’s breach of the MAA, namely its use of the ten Subcontractors without the prior approval of Techads.

128. While this Court has little hesitation in concluding that V Media breached the MAA, the onus is on Techads to convince this Court that this breach was the cause of a loss to Techads of circa $1.8 million, as it has claimed.

129. There are a number of reasons why this Court cannot on the balance of probabilities say that the amount claimed by Techads was caused by the breach by V Media of the MAA (i.e. the use of unapproved Subcontractors) and so should be paid to Techads as a liquidated sum pursuant to the indemnity in clause 10.1 of the MAA.

130. To support its counterclaim to be indemnified by V Media/First Click in the sum of is $1,852,719.65, Techads relies on two spreadsheets, referred to as the Ask Spreadsheet and the CBS Spreadsheet. Evidence was provided to the Court that the Ask Spreadsheet and the CBS Spreadsheet contain clawbacks amounting to a total of $13,497,486 relating to several digital marketing agencies who supplied internet traffic to Ask and CBS on behalf of Techads. Techads states that 13% of that clawback amount is attributable to V Media/First Click, which it is to be noted amounts to $1,754,673.

131. Taking these two spreadsheets in turn, the first one (the “Ask Spreadsheet”) was sent to Mr. Petito from an email address tae.kim@ask.com on 3 August 2022. This Ask Spreadsheet has what appears to be a list of 120 AdUnits and dollar amounts which were clawed back in relation to those AdUnits, most of which are redacted. Based on the evidence of Mr. Ascani, the redactions relate to the names of marketing agencies (other than V Media and First Click) and their respective clawbacks, which have been concealed as he said this constitutes confidential information.

132. Of the 120 AdUnits and clawbacks in this spreadsheet, there are however five which are unredacted and which were allocated to V Media and First Click i.e. AdUnit 370300 with a monetary figure of $783,468.72, AdUnit 370314 with a monetary figure of $706,335.60, AdUnit 370282 with a monetary figure of $201,461.80, AdUnit 371237 with a monetary figure of $85,099.69 and AdUnit 370275 with a monetary figure of $72,284.36. The total of these five amounts comes to $1,850.650.17, which Techads says is the total amounts, clawed back by Ask, which are attributable to those AdUnits for the months of April, May and June 2022.

133. Reliance was also placed by Techads on a second spreadsheet (“CBS Spreadsheet”). which was sent by email on 14 July 2022 to Mr. Petito from the following email address, liano.granillo@viacombs.com, with the heading ‘”CBSi”. On this document there appears to be a list of 20 AdUnits and dollar amounts. Seventeen of the AdUnits and dollar amounts are redacted, but there are three AdUnits which are not redacted, i.e. AdUnit 11703798 with a clawback figure of $1,958.78, AdUnit 11719403 with a clawback figure of $195.79 and AdUnit 11703788 with a clawback figure of $110.70.

134. The total of these three amounts comes to $2,265.27. The combined total of clawbacks in the Ask Spreadsheet and the CBS Spreadsheet therefore comes to $1,852,915.44

135. In relation to the eight unredacted AdUnits (i.e. the five unredacted AdUnits in the Ask Spreadsheet and the three unredacted AdUnits in the CBS Spreadsheet), this Court was provided with various messages between Techads and V Media/First Click that linked these eight AdUnits with V Media/First Click, save for the AdUnit 11719403. These emails were agreed by both parties to be admitted into evidence, on the basis of a Bula/Fyffes agreement, i.e. provided they emanated from the plaintiffs or the defendant, which all these messages did. However, AdUnit 11719403 could not be linked with V Media/First Click, as there was no message, or other documentary evidence, connecting that number to those parties. Accordingly, at the hearing, this Court was informed that Techads does not include the $195.79 in its claim for indemnification from V Media/First Click.

136. Thus, the total amount of the clawbacks, which Techads states is attributable to V Media/First Click comes to $1,852,915.44 less $195.79, which is $1,852,719.65.

137. It is important to note that Techads relies on the Ask Spreadsheet and the CBS Spreadsheet to claim that these clawbacks were caused by V Media/First Click and therefore that $1,852,719.65 represents the indemnification amount that it claims it is due from V Media/First Click pursuant to clause10.1.

138. However, there are a number of problems with this claim.

(i) The Ask and CBS Spreadsheets are not admissible evidence

139. The first problem with this Court relying on this evidence is that the Ask and CBS spreadsheets sent to Techads do not emanate from the defendants or the plaintiffs (so as to fall within the Bula/Fyffes agreement), since they appear to have been prepared by Ask and CBS. Crucially, as no evidence was provided by the persons who allegedly prepared these two documents, they are not admissible to prove that V Media (or First Click) caused this amount of financial loss.

(ii) Several versions of the total clawback being claimed

140. Secondly, this is not the only problem with this Court concluding that V Media/First Click caused $1,852,719.65 of a financial loss to Techads by its breach of the MAA and thus that they are liable to indemnify Techads in this amount. This is because, there appears to be considerable uncertainty regarding the accuracy of the correct total clawback figure, as there are several different versions of this amount.

141. For example, in the Replies to Particulars dated 24 March 2023, Techads states that the sum due from the plaintiffs in respect of clawbacks was ‘in or around USD$1,754,673’ (which, as previously noted, is 13% of the total clawed back from all digital marketing agents).

142. Later, and even though the Ask and CBS spreadsheets were exhibited with Mr. Ascani’s witness statement dated 2 May 2025, and the total of the clawbacks in those spreadsheets clearly amount to is $1,852,915.44 (prior to the deduction of $195.79), nonetheless in his witness statement, Mr. Ascani comes up with a completely different figure, since he states that “I have carried out an exercise to establish the extent of the clawbacks imposed upon TechAds by CBS and Ask. In 2022, a total sum of $1,236,035 was clawed back from TechAds.”

(iii) Discrepancy between Ask/CBS Spreadsheets and Techads’ spreadsheets

143. Thirdly, the inconsistency regarding the indemnification sum claimed from V Media/First Click relates not just to the total figure, but also to the individual figures in Techads’ own spreadsheets.

144. These are the two spreadsheets which were prepared by Techads (the “Techads’ Spreadsheets”), one of the amounts and total owed by V Media and one of the amounts and total owed by First Click. These two Techads Spreadsheets are also exhibited in Mr. Ascani’s witness statement and Mr. Ascani accepted that they are the basis for the calculation of Techads’ indemnification claim. However, in relation to the spreadsheet which Techads prepared for the calculation of the amounts claimed from V Media, it refers to AdUnit 370275 and attributes a figure of $77,327.64 for this AdUnit. Yet, in the Ask spreadsheet (upon which the Techads’ spreadsheet must be based), this has a figure of $74,284.36 for that AdUnit. There is no explanation for this discrepancy.

145. Similarly, in relation to the second Techads’ Spreadsheet, prepared by Techad for the calculation of the amounts it is claiming from First Click, this spreadsheet refers to AdUnit 11723012 with a figure $1,060.88 opposite it and it refers to AdUnit 370207 with a figure of $1,943.46 opposite it. However, none of these AdUnit numbers or monetary figures appear on any of the Ask or CBS spreadsheets. In relation to these AdUnits, Mr. Ascani accepted in his evidence that neither Ask nor CBS identified these two AdUnits as causing clawbacks. This clearly undermines Techads’ claim that these amounts could be attributable to the actions of V Media/First Click.

(iv) One AdUnit stated not to be exclusively used by V Media

146. Fourthly, quite apart from the uncertainty regarding the calculation of the individual figures and the calculation of the total figures, that make up the indemnification claim, there is also doubt about the extent that the AdUnits might be exclusively used by V Media/First Click in the first place. This is because in relation to AdUnit 370300, Ms. Da Silva of Techads copied an email on 12 May 2022 to Mr. Petito which stated: “Ad unit 370300 [Redacted] and Vmedia running at around $45K daily together. In this case, we can’t know exactly which agency is causing the issue of the ad unit. The ad unit has been paused in our side.” (Emphasis added)

147. This means that in relation to AdUnit 370300, it is not possible to say to what extent V Media and/or the redacted agency caused the financial loss of $783,468.72, attributable to that AdUnit. Mr. Ascani accepted in his evidence that the figure of $783,468.72, which was claimed by Techads, was therefore not all attributable to V Media/First Click. In its closing submissions Techads suggested that, for this reason, from the total figure for clawbacks of $1,852,719.65 which it was claiming, should be deducted the figure of $783,468.72, reducing the claim for clawback/indemnification to $1,069,250.93.

148. Of course, more generally, since Techads’ claim is based on the AdUnits attributed to V Media/First Click being exclusively used by those companies (and not by any of the other digital marketing agents used by Techads), this claim is clearly undermined by this email, since it acknowledges that at least one AdUnit is not used exclusively by V Media.

(v) Techads is not seeking to recover money it paid to V Media

149. Fifthly, and though not a determinative factor, it is nonetheless important to note that it is not in dispute that V Media did not receive payment for the Invoices for April, May and June of 2022. (Furthermore, this Court has now concluded that V Media is not entitled to payment for those Invoices.) Thus, although one is dealing with clawbacks, it is important to note that it is not the case that Techads is seeking to clawback money that it paid to V Media/First Click pursuant those Invoices or otherwise.

150. Instead, it is important to bear in mind that the clawbacks we are dealing with, which are the basis for the indemnification claim by Techads, relate to money Techads had to repay to Ask and CBS. Mr Ascani’s evidence was that the Ask and CBS Spreadsheets, which Techads were relying upon, related to clawbacks applicable to the months of April, May, June of 2022. Thus, it was accepted by Mr. Ascani that the clawback related to traffic, which was the ‘subject of the Invoices’, for which V Media never got paid. Thus, he agreed that the monies clawed back by Ask and CBS (which Techads was now seeking from V Media/First Click) were were never paid to V Media/First Click.

151. For this reason, counsel for V Media suggested to Mr. Ascani that if Techads had paid this money relating to the Invoices to V Media/First Click, and subsequently it had that revenue clawed back from CBS and Ask, Techads would be at a loss (in that particular sum). However, he suggested to Mr. Ascani that Techads was not at a loss, because Techads had not paid the ‘clawback’ money to V Media/First Click and so had no indemnification claim. Mr. Ascani agreed with this logic, with one caveat. On day 5, page 81, line 6 of the transcript, this was the exchange: Counsel for TechAds: If Techads had received the money and paid V Media and after that there was a clawback by CBS, then TechAds would be at a loss, as it had already paid the money to the plaintiffs, correct?

Mr. Ascani: Yes. But I don’t think the counterclaim is related to the loss of this invoice. The counterclaim is the loss of the business, a company that was doing strong profitability and a business that was growing very fast.’ (Emphasis added)

152. However, the problem with Mr. Ascani’s caveat is that this would mean that this Court is being asked to assess an indemnification claim (or indeed a breach of contract claim or a loss of business claim), based on the fact that of $1,852,719.65 was clawed back by Ask and CBS from Techads. However, the clawback figure was never paid over by Techads to V Media/First Click. Accordingly, this Court cannot see how it can use this sum as a basis for some kind of general ‘loss of the business’ claim, when this sum does not represent a loss of business, or in particular a loss of profit. Rather this amount of clawback, or whatever the final figure claimed might be (in view of the uncertainty over the figure), is based on a clawback of revenue that was sufferred by Techads, but that was never paid over to V Media. Accordingly, in this Court’s view, this clawback figure (whether it is $1,852,719.65 $1,754,673, $1,236,035, $1,069,250.93 or some other figure), it is not an accurate figure representing Techads’loss for which it should be indemnified.

153. For all these reasons, this Court can have no confidence that any of the figures presented to his court represent the amount of money actually lost by Techads as a result of V Media’s failure to obtain approval in advance for its use of the Subcontractors. Accordingly, this Court cannot make any order in relation to the counterclaim.

CONCLUSION

154. This Court concludes that V Media and First Click are not entitled to payment from Techads of the Invoices. This is because under the terms of their contract (the MAA) with Techads, Techads is entitled to withhold payment because of V Media’s and First Click’s failure to obtain Techads’ prior approval (by email) of any third-party providers of web traffic, which was directed by First Media and First Click to Techads’ clients.

155. While it is accepted that V Media and First Click breached the MAA in the foregoing manner, Techads has failed to provide this Court with evidence to establish, on the balance of probabilities that this breach caused any of the various figures for loss claimed during these proceedings (or indeed to what degree these losses were caused by other digital marketing agents). Accordingly, this Court does not have sufficient evidence to justify finding that any particular figure for financial loss is attributable to the breach of contract of V Media and First Click and for which Techads should be indemnified.

156. This case will be provisionally put in for mention at 10.30 a.m. on 9th October, 2025 to deal with any final orders and costs. However, in order to facilitate the parties agreeing all outstanding matters, the parties have liberty to notify the Registrar if such a listing proves to be unnecessary. This is particularly so in light of the clear implication from Word Perfect Translation Services Ltd v. Minister for Public Expenditure and Reform [2023] IECA 189 at para. 94, that there is an onus on lawyers to take a broad-brush approach to costs and not to engage in the inefficient use of court resources and costly ‘nit-picking’.