CHENNAI: A US Grand Jury has slapped a $940 million (`6,265.18 crore) fine in a trade secret lawsuit on two Tata Group firms — Tata Consultancy Services (TCS) and Tata America International Corp.
TCS, however, claimed that there was no IP infringement and that it would appeal against the ruling in higher courts and “defend its position vigorously”.
The verdict was delivered by a US Federal Court Grand Jury in Wisconsin regarding a lawsuit filed in October 2014 by US healthcare software firm Epic Systems. The verdict also comes in the wake of discrimination on Indian IT firms in H-1B and L-1 visa fee.
Epic had accused TCS of “brazenly stealing the trade secrets, confidential information, documents and data”, while consulting for its customer Kaiser Permanente. The jury has asked both companies to pay $240 million (`1,599.62 crore) to Epic, along with $700 million (`4,665.56 crore) in punitive damages.
TCS, India’s largest IT services player, has firmly denied the charge. “TCS did not misuse or benefit from any of the said information for development of its own hospital management system ‘Med Mantra’, which was implemented for a large hospital chain in India in 2009,” it said.
It said that the verdict and the liability were unexpected. “While TCS respects the legal process, the jury’s verdict on liability and damages is unexpected as the company believes they are unsupported by the evidence presented during the trial,” it said, adding that it appreciated the trial judge’s announcement from the Bench that he is almost certain he will reduce the damages award.
TCS said the development will not affect the company’s fourth quarter and FY2016 financial results. It is expected that the trial judgment will be entered in the case in the next six to eight weeks, following which the parties can file an appeal within 30 days.