TCS and TAI face $940 mn penalty for stealing data from Epic Systems

Two Tata group companies — Tata Consultancy Services (TCS) and Tata America International — have been slapped with a $940 million trade secrets verdict in Wisconsin, US, including $700 million in punitive damages, for stealing information related to Epic Systems’ healthcare software.

TCS, a leading IT services provider, denied charges and said it will defend its position.

Mumbai-headquartered TCS said it had received the jury verdict in a lawsuit filed by Epic Systems in the court of Western District Madison, Wisconsin.

The trial judgment will be entered in the case in next six to eight weeks. Tata group companies and Epic Systems can file an appeal within 30 days after the judgment is filed.

“While TCS respects the legal process, the jury’s verdict on liability and damages was unexpected as the company believes they are unsupported by the evidence presented during the trial,” said TCS in a statement.

TCS clarified that the jury verdict will not have any impact on the TCS Q4 and FY16 financial results to be announced on April 18. As an organization, TCS remains committed a protecting IP as well as its reputation and financial interests fully, Hindu BusinessLine reported.

In a lawsuit filed in October 2014 in US District Court in Madison, Epic Systems said TCS and Tata America International had stolen the trade secrets, confidential information, documents and data belonging to Epic.

In its lawsuit, Epic had said TCS took that data while consulting for its customer.

Epic said it recently learned from an informant that TCS employees have been fraudulently accessing Epic’s software beyond what the consulting contract required — and using Epic’s software to improve their own competing product, PTI reported.

One TCS employee’s account, which was used in India and several US locations, downloaded 6,477 documents, according to Epic.

“Rather than compete lawfully with Epic, TCS has engaged in an apparently elaborate campaign of deception to steal documents, confidential information, trade secrets, and other information and data from Epic, for the purpose of realizing technical expertise developed by Epic over years of hard work and investment,” the lawsuit said.

TCS said it did not misuse or derive any benefit from downloaded documents from Epic System’s user-web portal.

“TCS plans to defend its position vigorously in appeals to higher courts. TCS appreciates the trial judge’s announcement from the bench that he is almost certain he will reduce the damages award,” said the company on Saturday.

TCS did not misuse or benefit from any of the said information for development of its own hospital management system “Med Mantra’ which was implemented for a large hospital chain in India in 2009.

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