Synopsis
Software firm Mphasis has filed a lawsuit against rival Coforge in a US court. Mphasis claims Coforge hired its former executives in violation of contracts. The suit also alleges Coforge gained access to confidential client information. Mphasis seeks to prevent Coforge from employing former executives on shared client accounts. Coforge denies the allegations and plans to defend itself vigorously.In a filing dated March 31, Mphasis sought injunctive relief to prevent Coforge from employing two of its former executives on Charles Schwab accounts - a mutual client of both companies - and from using Mphasis' confidential data.
It also asked the court to bar former Vice President Brijesh Khergamker, who is named as a party in the matter, from working in Charles Schwab's outsourcing operations through Coforge for a year or accepting business from Mphasis customers as it violated his employment contract.
Coforge denied all allegations of wrongdoing and said it intends to vigorously defend itself and the employee in the matter, according to an emailed statement on Wednesday.
The company added that it is also evaluating potential counterclaims, and said that the client mentioned in the complaint has been an existing client for many years, with which it intends to grow its business relationship.
In response to a request for comment, Mphasis said on Thursday that its top priority is to protect its clients and that it would take the necessary action to enforce its rights when left with no other conciliatory alternatives.
Indian newspaper Mint first reported the development on Wednesday. Although dated March, the filing appeared in the government's legal database only last week.
Mphasis also sought compensatory damages and reimbursement of attorney fees and related costs, according to the filing, which did not provide further details.
Mphasis said that Coforge gained an "unfair competitive advantage" in the delivery of IT services by hiring at least four senior-level employees mentioned in the filing.
As demand for Indian IT services has slowed and competition intensified in recent years, companies have increasingly sued executives for violating their employment contracts.
Early last year, Infosys, India's second-largest IT firm, filed a counterclaim against rival Cognizant, saying that the U.S.-based company was engaging in anti-competitive practices and poaching key executives.
In 2023, Wipro sued former Chief Financial Officer Jatin Dalal after he joined Cognizant, claiming that the move violated the terms of his employment contract.
