Infosys has sued Cognizant and its CEO: Here's why
What's the story
Infosys has filed a counter lawsuit against Cognizant and its CEO, Ravi Kumar S, in the US. The Bengaluru-based IT giant claims that Cognizant adopted anti-competitive practices and misappropriated trade secrets to hinder the development of its healthcare platform, Infosys Helix. The move comes in response to a lawsuit by TriZetto, a subsidiary of Cognizant, accusing Infosys of stealing trade secrets of healthcare insurance software.
Legal demands
Infosys seeks jury trial and damages
Infosys has filed its counter lawsuit with the US District Court for the Northern District of Texas. The firm accuses Ravi Kumar, a former Infosys executive, of deliberately delaying the launch of Infosys Helix while he was leading the project. It also alleges that after joining Cognizant as CEO in January 2023, Kumar recruited key executives from Infosys. The company is seeking a jury trial and damages, along with legal costs and nullification of restrictive agreements imposed by Cognizant.
Company statement
Cognizant responds to Infosys's allegations
Responding to Infosys's lawsuit, Cognizant said it is committed to "upholding the highest standards of integrity in all business operations" and "encourages competition." The New Jersey-based firm further added that "competitors cannot use Cognizant's IP to unfairly compete, as Infosys has done." Cognizant also pledged to take decisive action against any allegations that compromise its competitive standing.
Accusations detailed
Alleged anti-competitive tactics by Cognizant
In its counter lawsuit, Infosys alleges that Cognizant employed monopolistic and restrictive tactics to suppress competition from more efficient and innovative rivals. The company began developing Helix in 2019, but claims that Kumar restricted resources for the platform after he started talks of joining Cognizant in 2022. This, allegedly, delayed the completion of Infosys Helix by at least 18 months.
Market impact
Infosys claims Cognizant's actions harmed competition
Infosys claims Cognizant's anti-competitive scheme involved targeted poaching of key senior executives responsible for Infosys Helix. The company alleges this conduct hurt competition in the healthcare payer software and related IT services markets, causing customers to pay higher prices for inferior quality products and services. Cognizant's original lawsuit states that Infosys misused TriZetto's software to create 'Test Cases for Facets,' improperly repackaging TriZetto's data into an Infosys product.