Class action lawsuit against iGate dismissed

A class action suit filed against iGate Corporation and its erstwhile CEO Phaneesh Murthy by a shareholder of the company has been dismissed with no payment from either the company or its former CEO, the company said on Friday.

The lawsuit was filed against the company and its former CEO Phaneesh Murthy in the United States District Court for the Northern District of California on June 14 following Murthy’s exist from the company on May 20 over alleged sexual relationship with a subordinate. The shareholder suit alleged that the company had violated federal securities laws by failing to disclose Murthy’s relationship with his subordinate.

Gerhard Watzinger, President and CEO of iGate, said, “With this resolution, we can move forward and continue to focus on delivering top quality services and solutions.”

The suit had alleged that iGate failed to disclose that Murthy was involved in an "improper relationship with a subordinate employee" in violation of its stated policies.

It also said "Murthy's improper conduct created a risk that he would be terminated from the company jeopardising the company's future success".