TCS Faces $70 Million Charge After Supreme Court Ruling
June 16: Tata Consultancy Services (TCS) has announced that it will incur a one-time charge of $70 million following the U.S. Supreme Court’s decision to decline its appeal in a trade secrets legal case. This brings the total financial impact for TCS to $220 million.
Key Details:
-
On June 15, the U.S. Supreme Court upheld a previous ruling that awarded $168 million in damages to DXC Technology.
-
TCS had previously set aside $150 million for this lawsuit but will now add an additional $70 million to cover damages, interest, and legal fees in its financial reports for the first quarter of 2027.
-
For context, TCS reported a net profit of 137.18 billion rupees (approximately $1.45 billion) for the fourth quarter.
-
The legal battle dates back to a 2019 lawsuit filed in federal court in Dallas. DXC’s predecessor, Computer Sciences Corporation, claimed that TCS recruited about 2,200 employees from Transamerica, another insurance firm, and utilized their insider knowledge to create a competing life insurance platform.
-
A jury in 2023 initially recommended that TCS pay $210 million for allegedly stealing trade secrets. However, U.S. District Judge Brantley Starr later reduced the amount to $168 million, which included $56 million in compensatory damages and $112 million in punitive damages. This decision was supported by the 5th U.S. Circuit Court of Appeals in 2025.
-
TCS contended to the Supreme Court that DXC should not be entitled to payment for unjust enrichment without demonstrating actual losses, and that the punitive damages were too high. However, DXC argued that the lower court’s ruling was sound and did not need further review.
Exchange Rate Note: $1 equals 94.5875 Indian rupees.
