By Kashmira Konduparty
Tata Consultancy Services (TCS), India’s largest information technology services company, said that it will take a $70 million financial hit after the U.S. Supreme Court declined to hear the company’s appeal in a long-running lawsuit brought by DXC Technology over allegations involving trade secrets and unfair competition, according to a report by Reuters.
The case stems form a 2019 lawsuit filed in federal court in Dallas by Computer Sciences Corporation (CSC), a predecessor of DXC Technology. CSC accused TCS of improperly benefiting from the hiring of approximately 2,200 employees from insurance company Transamerica and using their knowledge and access to help develop a competing life insurance administration platform.
The Supreme Court’s decision leaves intact a lower court ruling against TCS, bringing an end to the company’s legal options in the years-long dispute. TCS said it would record a charge of approximately $70 million related to the judgement.
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According to court filings, CSC alleged that TCS gained an unfair competitive advantage after recruiting a large number of employees who has worked on Transamerica’s insurance technology systems. The lawsuit claimed that information and expertise obtained through those employees were used to create a rival platform that competed directly with CSC’s insurance software business.
DXC, which was formed through the merger of CSC and Hewlett Packard Enterprise’s services business on 2017, inherited the lawsuit and continued pursuing the claims against TCS.
TCS denied wrongdoing throughout the litigation and argued that the allegations lacked merit. The company maintained that it developed its technology independently and that hiring employees from another company did not constitute misuse of proprietary information.
The dispute focused on technology used by insurance companies to manage policies, claims and customer records, an area that has become increasingly competitive as insurers modernize their digital infrastructure. The case attracted attention within the technology services industry because it involved questions about employee mobility, intellectual property protections and competition among major outsourcing firms.
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In a regulatory filing, TCS said it would comply with the legal outcomes while continuing to evaluate the financial implications of the ruling. The company noted that the charge would be reflected in its financial statements.
TCS, part of the Tata Group, is India’s largest software services exporter and serves clients across banking, healthcare, insurance and other industries. The company generates billions of dollars in annual revenue and employs hundreds of thousands of workers globally.
While the $70 million charge is not expected to have a material impact on TCS’s long-term operations, the Supreme Court’s refusal to hear the appeal marks the conclusion of one of the company’s most closely watched legal battles in the United States.