TCS Faces 194 Million Dollar Trade Secret Penalty in the US Key Facts and Impact Explained
TCS has been sued in the US for being held liable over a trade secrets claim by DXC Technology Co. The claim is that TCS hacked into CSC’s proprietary insurance software platforms like Vantage one and CyberLife by employees who moved from a CSC-licensed firm to TCS.
TCS is said to have reworked the software into its own BaNCS platform for insurance clients. The lawsuit goes back to an outsourcing contract in 2018 between Transamerica and TCS worth about 2 billion dollars over ten years that was early terminated in 2023 when Transamerica decided to bring its IT operations back in-house.
What the court decided
In June 2024, a US District Court found TCS liable for trade secret misappropriation and imposed penalties of approximately 194 million US dollars.
In November 2025, the US Court of Appeals upheld the monetary judgment. The earlier injunction that would have prevented TCS from using certain materials related to the BaNCS software was lifted and the case was sent back for evaluation.
Why this matters for TCS
Simply put, this means that TCS is required to record the 194 million dollar trade secret charge as one of the expenses in their accounts once they have decided the appropriate quarter. That will undoubtedly impact their profit and margin.
During Q2 of the July to September 2025 period, TCS had reported a net profit of 12,075 crore rupees which is approximately 1.3 billion dollars on a revenue of 65,799 crore rupees which is approximately 7.3 billion dollars. Their EBIT margin was 25.2 percent.
Even if the injunction had continued, TCS’s business in the US, particularly concerning the BaNCS platform, might not have suffered so badly just because of the financial cost but also because of limitations on its software operations. Currently, with the injunction lifted, the worst immediate outcome has been averted. The threat of legal action still remains.
What TCS is doing now
TCS declared that it is considering various options including looking at the matter again and appealing before the proper courts and that it intends to defend its stance vigorously.
The company also mentioned that it will make provisions as necessary in the financial statements consistent with the accounting standards that are in force
What to watch next
The circumstances are gradually revealing themselves, and there are several points to be kept an eye on.
- If TCS decides to file a further appeal and the duration of that process.
- The time when TCS decides to record the cost and the effect it has on the quarterly or annual earnings.
- The emergence of new injunctions or restrictions that might affect the usage of the BaNCS platform in the US.
- The possible consequences for Indian IT companies and how they deal with client software, staff movement, and confidential technology.
Read More News : Click Here