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US federal jury slaps Rs 6,300 cr fine on two Tata group firms in trade secret case

The federal grand jury in the US has slapped two companies of Tata group - Tata Consultancy Services (TCS) and Tata America International Corp – with a $940 million (approx Rs 6,265 crore) fine in a trade secret lawsuit filed against them.
India TV Business Desk April 16, 2016 19:59 IST
India TV Business Desk

Washington: The federal grand jury in the US has slapped two companies of Tata group - Tata Consultancy Services (TCS) and Tata America International Corp – with a $940 million (approx Rs 6,265 crore) fine in a trade secret lawsuit filed against them.

After days of hearing, a grand jury in the US State of Wisconsin ruled that Tata Consultancy Services Ltd and Tata America International Corp must pay $240 million to Epic Systems for ripping off its software.

Tatas have also been asked to pay another $700 million in punitive damages.

"Rather than compete lawfully with Epic, TCS has engaged in an apparently elaborate campaign of deception to steal documents, confidential information, trade secrets, and other information and data from Epic, for the purpose of realising technical expertise developed by Epic over years of hard work and investment," the lawsuit said.

However, the final penalty is yet to be determined as the judge is expected to give his final ruling in the matter soon.

Epic Systems had accused TCS and Tata America International Corp, in a lawsuit filed in October, 2014 in US District Court in Madison which was amended in January and December 2015, of "brazenly stealing the trade secrets, confidential information, documents and data" belonging to Epic.

In its lawsuit, Epic had said that TCS took that data while consulting for its customer. Epic said that it "recently learned from an informant" that TCS employees have been "fraudulently accessing" Epic's software beyond what the consulting contract required - and using Epic's software to improve their own competing product.

One TCS employee's account, which was used in India and several US locations, downloaded 6,477 documents, according to Epic.

Meanwhile, Tata Consultancy Services on Saturday said that it will "defend" itself against a US grand jury verdict.

"TCS plans to defend its position vigorously in appeals to higher courts. TCS appreciates the trial judge's announcement from the bench that he is almost certain he will reduce the damages award," TCS said in a statement today.

(With PTI inputs)