In re Cognizant Technology Solutions Corporation Securities Litigation
|Court:||United States District Court, District of New Jersey|
|Class Period:||02/01/2015 - 02/01/2016|
|Case Contacts:||John Rizio-Hamilton, Abe Alexander|
This is a securities fraud class action case, pending in the US District Court for the District of New Jersey, brought by a group of institutional investors on behalf of purchasers of Cognizant common stock between February 2015 and September 2016.
The case alleges that Cognizant and certain of its executives violated federal securities laws by making false statements to investors. Specifically, this case alleges that Cognizant and its executives made false statements concealing the fact that the company had made illegal payments to secure favorable land permits – called “SEZ permits” – for its facilities in India. Cognizant has already acknowledged that it improperly paid at least $5 million to Indian officials to obtain favorable land permits, and has admitted that members of the company’s “senior management” participated in making, or ignored, the corrupt payments. On September 30, 2016, when Cognizant publicly disclosed that it was investigating “payments relating to facilities in India were made improperly and in possible violation of the U.S. Foreign Corrupt Practices Act and other applicable laws,” the Company’s stock fell significantly, wiping out $4.4 billion in shareholder value. Notably, the same day Cognizant disclosed its bribery investigation, it also announced the surprise resignation of the Company’s President, Gordon Coburn.
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