The US Appeals Court upheld the $194M penalty against TCS in the DXC/CSC trade secrets dispute. TCS must provision the amount but secured partial relief as the court vacated the BaNCS injunction. Full legal and financial analysis.
TCS $194 Million Trade Secret Lawsuit Appeals Court Ruling
In a major development poised to shake investor confidence and refocus scrutiny on intellectual property governance across the Indian IT sector, the United States Court of Appeals for the Fifth Circuit has upheld the hefty $194 million damages award against Tata Consultancy Services (TCS). The ruling confirms the massive financial penalty levied against India’s largest software services exporter in its long-running trade secret lawsuit with DXC Technology Company (formerly Computer Sciences Corporation, or CSC).
The adverse ruling, delivered on November 21, 2025, confirmed the previous judgment issued by a US District Court, which found TCS liable for misappropriating proprietary information. The total financial penalty of $194.2 million is broken down into approximately $56 million in compensatory damages, a substantial $112 million in exemplary (punitive) damages, and $26 million in pre-judgment interest.
The core of the dispute, which dates back to 2019, revolves around allegations that TCS gained improper and unauthorized access to CSC’s licensed insurance software platforms, including Vantage-one and CyberLife. The plaintiffs argued that this access was achieved through former Transamerica employees who transitioned to TCS as part of a prior $2 billion outsourcing deal.
Despite the major financial legal setback, the Appeals Court granted TCS a vital, if partial, measure of relief. The court vacated the injunction that had been previously issued against the company, which would have severely restricted TCS’s ability to use certain materials related to the BaNCS platform going forward. This injunction order has now been remanded back to the US District Court for reassessment based on the appellate court’s directions, offering temporary operational relief and preventing an immediate disruption to a key business offering.
Following the US Appeals Court Ruling, TCS issued a regulatory filing, calling the decision adverse but confirming its intention to “vigorously defend its position.” The company stated it is currently evaluating all legal options, including the possibility of pursuing further review or appealing to the US Supreme Court.
Analysts have noted that while the TCS stock impact was visible, the partial relief on the injunction prevented a steeper market reaction. The ruling, however, sends a strong regulatory signal across the entire IT Services India industry, reinforcing the high cost of non-compliance with global IP governance standards. This case, alongside a similar, previously contested Epic Systems trade secret dispute, places intense scrutiny on the management of client-proprietary data during large-scale outsourcing and employee transition projects.
