Info-tech

US Court confirms $140-m penalty by TCS in Epic Systems case

Ayushi Kar | Updated on: Jul 04, 2022
In October 2014, TCS was slapped with a lawsuit and asked to pay $940 million to Epic, which was later reduced to $280 million and then to $140 million

In October 2014, TCS was slapped with a lawsuit and asked to pay $940 million to Epic, which was later reduced to $280 million and then to $140 million | Photo Credit: DNY59

The IT major was slapped with a lawsuit after being accused of stealing trade secrets

The US District Court for the Western District of Wisconsin has confirmed the $140-million fine against IT major Tata Consultancy Services (TCS) in the dispute against Epic Systems. TCS plans on appealing the judgment in the US Courts of Appeals 7th Circuit Chicago.

“We hereby inform you in the EPIC Systems Corporation matter, the US District Court for the Western District of Wisconsin passed an order reducing the jury award of punitive damages to $140 million and directed the Clerk of the Court to file the amended judgment accordingly,” the company disclosed in a regulatory filing.

This comes after a top US court halved the penalty to be paid by the IT major in its ongoing case with Epic Systems from $280 million, in August 2021. In October 2014, TCS was slapped with a lawsuit and asked to pay $940 million to Epic, which was later reduced to $280 million.

The case story

The matter relates to a US grand jury order that slapped two Tata group companies — Tata Consultancy Services and Tata America International Corp — with the fine in a trade secret-related lawsuit filed against them by Epic Systems. The latter had accused the companies of “brazenly stealing trade secrets, confidential information, documents and data”.

The US-based healthcare software company had implemented its healthcare management system in the Kaiser Permanente, a healthcare service provider. TCS was hired to test the system implementation. In the course of implementation, TCS employees had restricted access to Epic’s documents. Despite restricted access, Epic Systems alleged that TCS employees used a Kaiser Permanente employee’s credentials to steal over 6,000 documents.

So far, TCS has maintained that there is no evidence of misuse of Epic’s information, and that it plans to defend its position before the appeal court.  In its July 4 disclosure to SEBI, the company noted, “TCS is legally advised that it has strong arguments in its favour before the appeal court and the order on the punitive damages is not supported by the facts presented by TCS before the trial court. We have been advised that the order and the judgment when issued is appealable to the US Courts of Appeals 7th Circuit Chicago.”

Published on July 04, 2022
COMMENTS
  1. Comments will be moderated by The Hindu editorial team.
  2. Comments that are abusive, personal, incendiary or irrelevant cannot be published.
  3. Please write complete sentences. Do not type comments in all capital letters, or in all lower case letters, or using abbreviated text. (example: u cannot substitute for you, d is not 'the', n is not 'and').
  4. We may remove hyperlinks within comments.
  5. Please use a genuine email ID and provide your name, to avoid rejection.

You May Also Like

Recommended for you