Key facts
- Tata Consultancy Services will book a $70 million exceptional charge in Q1 FY27.
- The US Supreme Court rejected TCS's appeal in a trade secrets dispute with DXC Technology.
- The total financial exposure for TCS in the case now stands at $220 million.
- DXC Technology was awarded $168 million in damages by a lower court.
- The dispute originated from a 2019 lawsuit alleging improper use of confidential information.
Tata Consultancy Services (TCS) will recognize an exceptional charge of $70 million in the first quarter of fiscal year 2027 following the US Supreme Court's decision to decline hearing its appeal in a trade secrets dispute with DXC Technology. This charge brings TCS's total financial exposure in the case to $220 million.
The Supreme Court's refusal on June 15 to hear the appeal allows a lower court ruling awarding damages to DXC Technology to stand, effectively concluding TCS's legal challenge. The company stated it has already provided $150 million towards the case and will now account for the additional $70 million to cover damages, accrued interest, and legal expenses.
The dispute dates back to a 2019 lawsuit filed by Computer Sciences Corporation, DXC Technology's predecessor, which accused TCS of improperly using confidential information obtained from former Transamerica employees to develop a competing life insurance administration platform. A jury initially awarded $210 million in damages in 2023, but US District Judge Brantley Starr reduced this to $168 million, comprising $56 million in compensatory and $112 million in punitive damages. The 5th U.S. Circuit Court of Appeals upheld this reduced award in 2025.
TCS had argued before the Supreme Court that DXC should not have received unjust enrichment damages without proving actual losses and that the punitive damages were excessive. DXC maintained that the lower courts applied the law correctly and that the case did not warrant review by the nation's highest court.