US court cuts fine on TCS to USD 420 mln in a trade secrets case by Epic Systems

TCS Q4: Profit drops 0.85% to Rs 8,049 crore, revenue rises 0.23% to Rs 39,946 crore QoQ. Dollar revenue dips 2.5% to $5,444 million QoQ. (Image: Moneycontrol)

Tata Consultancy Services in a filing to the stock exchange said that a US court more than halved the USD 940 million jury award granted to Epic Systems, a healthcare software company that had accused the Indian IT player of stealing its trade secrets.

The Western District Court of Wisconsin issued an order reducing the USD 940 million awarded to EPIC to USD 420 million.

TCS said it plans to appeal the decision.

“The company has received legal advice to the effect that the order and the reduced damages awarded are not supported by evidence presented during the trial and a strong appeal can be made to superior court to fully set aside the jury verdict,” TCS said in a filing with the Bombay Stock Exchange.

Last year, a US Grand Jury slapped Tata group companies TCS and Tata America International Corp with a USD 240 million fine in a trade secret lawsuit filed against them by Epic Systems. The Tatas have also been asked to pay another USD 700 million in punitive damages.

Epic had accused TCS employees of "brazenly stealing trade secrets, confidential information, documents and data", and using this to build its own healthcare system.

“The company did not misuse or derive any benefit from EPIC’s documents and plans to defend its position vigorously before the trial judge as well as in appeal,” TCS said in the filing.

The company also said the order will not have an impact on its second-quarter results, which will be announced on October 12.