TCS Employees Steal Trade Secrets From Client; Slapped With Rs 1000 Crore Punishment
India’s leading IT services provider, Tata Consultancy Services, is in grave trouble as the company has been slapped with an intellectual property lawsuit. The company will have to pay up an amount of $140 million under the charges of stealing trade secrets.
Why was TCS charged with such a huge sum of money? What is TCS accused of? Read on to find out!
Tata Consultancy Services Accused Of Stealing Intellectual Property; To Pay Fine Of $140 Million
In 2014, a Verona, Wisconsin-based company, Epic Systems Corp. had hired Tata Consultancy Services and its subsidiary, Tata America International Corporation, to assist the former in setting up its systems at a medical facility in Portland.
By October, Epic Systems accused TCS employees who were working on site of stealing the company’s trade secrets and intellectual properties. They also accused the employees of building another software that was copied from the original software and filed a lawsuit against TCS.
In April 2016, a jury in Wisconsin ruled that TCS was guilty and would have to pay $240 million as a compensation to the damages to Epic and $700 million as punitive damages.
However, the charges were brought down by a Wisconsin judge from $940 million to $420 million, which included $140 million in compensatory damages and $280 million as punitive damages. These were upheld by the US Court of Appeals, 7th Circuit, Chicago, but the lower court was asked to reduce the punitive damages of $280 million imposed on TCS.
Tata Consultancy Services has responded that the case against the company doesn’t have any material proof and that the company did not “misuse or derive any benefit from downloaded documents from Epic Systems.”
Not The First Time For TCS; Will Face Problems In Projects In Future
This is not the first time that TCS has landed in such trouble. Another company, Computer Sciences Corp (CSC) also filed a similar case against TCS and its subsidiary in America for stealing trademarks and other intellectual property software.
TCS can still go to the higher courts in the US to show that their software isn’t similar to that of Epic’s. TCS has always maintained that the intellectual property rights of clients and partners are intolerant of infringement.
However, if the higher courts also rule against TCS, the company will have to go through severe issues in its projects with the US in the future.