Infosys, the Bengaluru-based IT giant, has announced its firm intention to “vigorously defend” itself against a trade secrets lawsuit filed by its competitor, Cognizant. The legal dispute, currently unfolding in a Texas federal court, revolves around allegations that Infosys misappropriated trade secrets related to Cognizant’s healthcare insurance software.
On August 23, 2024, Infosys issued a statement refuting the claims made by Cognizant’s subsidiary, Cognizant TriZetto. The lawsuit accuses Infosys of unlawfully using TriZetto’s software, specifically the Facets and QNXT platforms, to develop a product called “Test Cases for Facets.” Cognizant alleges that Infosys repurposed TriZetto’s data to create new software, thereby breaching confidentiality agreements and legal protections, as reported by PTI.
In response to these allegations, Infosys stated, “Infosys is aware of the lawsuit. We deny all allegations and will defend our position in the court.” The company’s spokesperson underscored their commitment to contesting the charges while upholding their legal and ethical standards.
This lawsuit adds to the already intense rivalry between Infosys and Cognizant, both of which are nearing $20 billion in revenue. The competition is further intensified by personal connections between the two companies; Cognizant’s CEO, Ravi Kumar S, previously held senior positions at Infosys, including President and Deputy Chief Operating Officer, until October 2022. Additionally, Cognizant recently appointed Rajesh Varrier, another former Infosys executive, as its new India Chairman and Managing Director.
The legal battle follows Infosys’s previous allegations against Cognizant for allegedly poaching key executives, documented in a letter last year. This situation echoes similar disputes within the Indian IT sector, such as Wipro’s lawsuit over executive departures, which was settled earlier this year with Cognizant agreeing to a $505,087 payment in a non-compete settlement.
As the IT industry grapples with an uncertain demand environment and historically low revenue and profits, these legal conflicts between major players like Infosys and Cognizant highlight the competitive pressures within the sector.
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