Tata Consultancy Services Ltd. (TCS) said in the EPIC Systems Corporation matter that it would be Rs 1,218 crore as an exceptional item, in the financial results for the three and six months ended on 30 September 2020.
In October 2014, EPIC Systems had filed a legal claim against TCS in the court of Western District Madison, Wisconsin alleging violation of Epic’s proprietary information.
TCS said that it is legally advised to have the correct and the strongest possible arguments in its favour and through facts represented that reduced damages are not supported during the Trial.
In September 2020, it has filed a petition seeking for the re-hearing on both the compensatory and punitive damages. EPIC has also filed a petition for the re-hearing of Appeals Court’s decision invalidating award of punitive damages and exceeding the amount of compensatory damages.
The US grand jury ordered a $ 940 million fine on Tata Group’s two companies, TCS and Tata America International Corp. for the secret lawsuit filed by EPIC Systems against them in April 2016.
On 16 April 2016, TCS disclosed to the stock exchanges regarding the US Court’s verdict on the intellectual property rights case with EPIC Systems and on 1 October 2017, TCS said that the court has significantly reduced the $ 940 million compensatory and punitive damages to $ 420 million.
In May this year, SEBI (Securities and Exchange Board of India) had warned the IT major to be careful in dealing with disclosure of material information to investors after the market regulator found that TCS did not prominently display the extent of damages related to EPIC Systems case. The watchdog also asked TCS to ensure that the disclosures provide adequate, accurate, explicit and timely information to the investors.