Cognizant Sues Infosys for Alleged Misuse of Trade Secrets in Healthcare Software
Cognizant Sues Infosys for Alleged Misuse of Trade Secrets in Healthcare Software
Cognizant has made serious allegations against Infosys, claiming that the latter has stolen trade secrets related to its healthcare software, TriZetto. According to a report by Mint, Cognizant submitted a 22-page legal filing to a US court on February 7, asserting that Infosys misappropriated the trade secrets of TriZetto, which Infosys initially accessed through non-disclosure agreements (NDAAs).
This accusation follows a countersuit from Infosys, which is the second-largest software exporter in India. Infosys alleged that Cognizant and its CEO, Ravi Kumar, employed anti-competitive strategies and improperly used sensitive information to impede the growth of its own healthcare platform, Infosys Helix. Infosys further claimed that during his previous tenure as president at Infosys, Ravi Kumar delayed the launch of Infosys’s healthcare software while negotiating a position with Cognizant.
Ravi Kumar transitioned from Infosys, where he worked until October 2022, to become the CEO of Cognizant in January 2023. Both companies are competitors in the healthcare services sector, with Infosys deriving approximately 7.5% of its revenue, or about $1.4 billion, from clients in the life sciences industry.
At the same time, Cognizant generates nearly one-third of its revenue from the healthcare sector, totaling around $5.9 billion, as stated in the report.
Cognizant’s claims against Infosys:
Cognizant’s subsidiary, Cognizant TriZetto, previously filed a lawsuit in a federal court in Texas, alleging that Infosys illegally utilized its healthcare insurance software. The lawsuit claims that TriZetto’s software, Facets and QNXT, is commonly used by healthcare insurance companies to streamline administrative tasks. Cognizant asserts that Infosys improperly repackaged TriZetto’s data into its own product called “Test Cases for Facets.”
Cognizant further alleges that Infosys declined to allow an audit of its use of TriZetto’s information, which could have revealed important evidence. They stated, “When confronted, Infosys obfuscated to the maximum extent possible, asking TriZetto to simply trust, based on nothing, that there had been no wrongdoing.” When TriZetto insisted on an audit of Infosys’s use of its information, as allowed under the non-disclosure agreements (NDAAs) due to the alleged trade secret theft, Infosys refused to comply. As a result, Cognizant has now asked the court to compel Infosys to produce all relevant documents concerning the matter.
Continued legal disputes between Infosys and Cognizant:
The conflict between the two IT companies has been ongoing for several months. It started when Infosys accused Cognizant of stealing its senior executives, particularly after the appointment of Ravi Kumar S, Infosys’ former president and deputy COO, as Cognizant’s CEO. Cognizant has also encountered similar accusations from another Indian IT firm, Wipro. Wipro filed lawsuits in both the U.S. and India against two former executives, Mohd Haque and former CFO Jatin Dalal, who later joined Cognizant. However, on July 9, 2024, Wipro and Cognizant came to a settlement regarding the non-compete lawsuit.
