TCS fined 940 million dollars!

The following article is based on my own interpretation of the said events. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Mohit Kharkwal, MBA 2015-17, Vinod Gupta School of Management, IIT Kharagpur

_________________________________________________________________

TCS has been fined by a US federal court in Wisconsin for stealing software from one of its clients. TCS’s client is US based healthcare software firm called Epic Systems. It accused TCS of “brazenly stealing the trade secrets, confidential information, documents and data” belonging to the company. Company went on to say that TCS then used this information to create its own rival product called ‘Med Mantra’.

Federal grand jury of Wisconsin ruled that TCS and Tata America International must pay 240 million to Epic Systems for stealing the software and 700 million in damages. TCS said that the verdict in “unsupported by evidence presented” and that it plans to appeal to the higher court.

Also revealed in the complaint is that Epic Systems was tipped of by one of TCS’s employee that TCS has downloaded close to 6500 documents and 1687 files from Epic’s computers inappropriately. Some of these files had proprietary software. It also blames that TCS’s leadership in both India and US knew about it.

Main defence of TCS is that it did not misuse or benefit from any of the information that was downloaded and no code of Epic Systems was used in making of Med Mantra. TCS is also trying to calm the spooked investors by saying this verdict will be challenged vigorously in upper courts and  will not have any impact on TCS Q4 and FY16 financial results.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s