BANGALORE: The iGate vs Phaneesh Murthy battle is getting uglier. iGate has filed a counter-complaint against its former CEO alleging the firm had suffered significant damages from the events following Murthy's failure to disclose his relationship with a subordinate employee, and has claimed compensation. The complaint alleges "secret mediations" between Murthy and the employee, and another sexual harassment case against Murthy that was not brought to the company's notice.
The counter-complaint, a copy of which is with TOI, has been filed before the same Alameda County Superior Court of California where Murthy in December had filed a defamation and breach of contract case against his former employer. iGate has alleged that Murthy participated in a secret mediation with the subordinate employee without notifying the company, and only when the mediation was unsuccessful did he notify iGate about the employee's claims against him and the company. The mediation, it said, was done under the names "Jane and John Doe" and a retired Superior Court judge Richard Bennett was the mediator.
iGate said it wants to recover damages caused by Murthy's irresponsible behaviour, including recovering its attorney's fees and other costs incurred in connection with resolving the subordinate's claims against Murthy and iGate. The company said Murthy's employment contract obliges him to "indemnify the company for any loss suffered as a consequence of a breach" of the company's rules and regulations. iGate says a broad-gauged indemnification clause was introduced in Murthy's contract partly because of the history of sexual harassment cases brought against him when he was head of sales at Infosys. Two Infosys employees had levelled charges that were settled in 2003 and 2004.
When TOI contacted iGate, the company spokesperson said, "Beyond the cross-complaint itself, we are not commenting on this ongoing litigation."
The Nasdaq-listed company had fired Murthy in May last year on the grounds that he had failed to report his relationship with the company's investor relations head Araceli Roiz as was required by the company's policy. In December, Murthy filed a defamation and breach of contract case, and charged iGate with withholding his vested stocks and various benefits due to him.
Reacting to iGate's counter-complaint, Murthy said, "It is quite the norm to file counter-complaints, so this was anticipated when we filed the lawsuit. Like I told you earlier, I had put in years of hard work to turn around the company. I do think it was wrongful and unfair termination and hence I am entitled to the vested stocks and the medical benefits. I am confident that the truth will come out in the court." Murthy has claimed that the company Board knew about his relationship with Roiz all along, and has even alleged that there have been a number of similar consensual relationships in iGate, but the company had not acted on any, barring his.
On the contrary, iGate in the complaint says Murthy didn't disclose his affair to the chair of iGate's corporate governance committee, Goran Lindahl, even when Lindahl had raised the matter with Murthy twice in 2011 following some anonymous internet postings in 2011 alleging that the then iGate CEO was having an affair with an unnamed subordinate. Murthy, the complaint says, rubbished the internet posts saying that "anyone can write what they want on internet posts."
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