Class action suit against Infosys on whistleblower complaint stands dismissed
The lawsuit case was filed in October 2019 in the United States District Court against Infosys, its CEO Salil Parekh and CFO Nilanjan Roy after whistleblower complaint surfaced.
May 22, 2020 / 11:43 AM IST
The class action suit filed in the US against Infosys was dismissed by its plaintiffs, shareholders in the US, without prejudice.
The lawsuit case was filed in October 2019 in the United States District Court against Infosys, its CEO Salil Parekh and CFO Nilanjan Roy after a whistleblower complaint had surfaced.
The whistleblowers accused Parekh and Roy for accounting irregularities and "unethical practices" to boost growth numbers. Following the report, Infosys' share price tanked close to 16 percent on the BSE and the US stock exchange NYSE, wiping out its market cap by nearly Rs 50,000 crore.
“The complaint, which was filed in the Eastern District of New York, was brought on behalf of a class consisting of persons or entities who purchased the Company's publicly traded securities between July 7, 2018 and October 20, 2019, and alleged claims for violations of the US federal securities laws,” according to a company statement.
“On May 21, 2020, the plaintiff voluntarily dismissed the lawsuit without prejudice,” the statement added.
According to reports, the US-based Schall Law Firm and Rosen Law Firm, filed the lawsuit to investigate potential securities claims on behalf of Infosys shareholders in the US.
India’s second-largest tech major released the detailed report on the outcome of its audit committee investigation on a whistleblower complaint in January, which gave clean chit to Infosys. The investigation was done with the assistance of independent legal counsel Shardul Amarchand Mangaldas & Co and PricewaterhouseCoopers.
In March, the US Securities and Exchanges Commission, which was investigating the case gave a clean chit to Infosys.