US-based Private Consulting Firm accuses Tata Consultancy Services Ltd (TCS) of IP infringement in US court

August 25,2018:

US-based private consulting firm filed a case against India’s largest IT outsourcing firm Tata Consultancy Services Ltd (TCS) in Texas Court for IP infringement.

Simonelli accused TCS of using their trade secrets and confidential information to build its own consulting practice and is seeking a compensation for the loss in revenue on the account of TCS.

On 11 June 2014, Simonelli and Tata America International Corp (TAIC) agreed to co-develop a “prototype factory and co-innovation model” where TCS was supposed to provide prototyping services to the clients. Simonelli claims to have invested the money and time to develop its own methodology and expertise, which is a trade secret according to the Defend Trade Secrets Act.

Despite this, the defendant used it to transform their consulting options, obtain customers and increase their revenue without including the plaintiff as per the agreement, mentioned in the plaintiff’s lawsuit.

On August 15, after an email sent to TCS addressing this issue went unanswered, Simonelli filed a case saying that TCS and TAIC had agreed to keep IP and trade secrets of Simonelli Innovation confidential and to only use the same in projects under the ‘Alliance Agreement’ that would mutually benefit both the firms, but it misused those secrets outside of the agreement to build their business.

This is the second time TCS was sued for IP infringement in the US, first being when Epic System Corp, healthcare software firm had accused TCS of using its proprietary software to build its own healthcare product in 2016.

US court had ordered TCS to pay $420 million for the compensation.

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