Tata Consultancy Services to Record $70 Million Charge After US Supreme Court Rejects Appeal

On June 15, the US Supreme Court declined to intervene in the case, leaving intact a lower court judgment.

Tata Consultancy Services (TCS) said on Tuesday that it will record a one-time exceptional charge of $70 million in the first quarter of FY27 after the US Supreme Court declined to hear its appeal against a lower court ruling in a long-running legal dispute involving Computer Sciences Corporation, which is now part of DXC Technology. In a regulatory filing to the BSE, the company noted that it had already set aside $150 million in its accounts for the case in line with applicable accounting requirements. TCS said it will now recognise a further $70 million towards damages, interest obligations and legal expenses, which will be reflected as a one-time exceptional charge in its first-quarter FY27 financial results. The company had previously disclosed developments related to the litigation through exchange filings made in June 2024 and November 2025. TCS informed investors that the US Supreme Court had chosen not to review the judgment delivered by the United States Court of Appeals for the Fifth Circuit in the lawsuit brought by Computer Sciences Corporation. Referring to its earlier disclosures, the company stated that the Supreme Court denied its petition for a writ of certiorari on June 15, 2026, effectively leaving the appellate court's decision unchanged. The latest development follows an earlier setback for TCS when the Fifth Circuit upheld a damages award of $194.2 million and ruled in favour of Computer Sciences Corporation in the trade secrets dispute that had been contested for several years.

What the case is about

On June 15, the US Supreme Court declined to intervene in the case, leaving intact a lower court judgment that awarded damages to DXC Technology and effectively closing the door on TCS's legal challenge. The legal battle traces its origins to a case filed in a federal court in Dallas in 2019 by Computer Sciences Corporation, the company that later became part of DXC Technology. The lawsuit alleged that TCS used confidential information obtained through former Transamerica employees while creating a competing platform for administering life insurance operations. The complaint said that TCS hired nearly 2,200 employees from Transamerica and that it subsequently benefited from these people’s access to the insurer's proprietary data, systems and internal information. In 2023, a jury ruled that TCS had intentionally misappropriated trade secrets and awarded it damages to the amount of $210 million. This was later reduced by US District Judge Brantley Starr to $168 million. This amount included $56 million in compensatory damages and $112 million in punitive damages. That revised judgment was subsequently affirmed by the Fifth US Circuit Court of Appeals in 2025. While challenging the ruling before the US Supreme Court, TCS on its part argued that DXC had been granted unjust enrichment damages without sufficiently proving any actual losses. The company had also maintained that the punitive damages awarded were disproportionate. DXC, meanwhile, argued that the lower courts had correctly applied the law and that there was no reason for the Supreme Court to revisit the matter.