Lost $17 million in vested stock interest, says Murthy.
By Deepak Chitnis
WASHINGTON, DC: Former iGate CEO Phaneesh Murthy, who left the company earlier this year in the midst of controversy, is suing the company for breach of contract and defamation.
Murthy was forced to vacate his position iGate in May, when it was uncovered that he was in a relationship with a subordinate employee that he failed to disclose. Now, Murthy is striking back, saying that iGate did, in fact, know about the relationship beforehand, meaning he didn’t have to disclose anything.
Murthy was involved with Araceli Roiz, the company’s head of investor relations, despite being married and having been fired from a management position at Infosys in 2002 over similar allegations. Murthy sued that company as well, settling out-of-court for $3 million.
In an interview with The Times of India, Murthy says iGATE knew as early as January of 2012, but later used it the relationship against him to force him out of the company. Murthy also said that another iGATE executive was having an affair with a subordinate worker, but no action was taken against them, insinuating that there was a conspiracy against Murthy.
In total, Murthy says that being forced out of iGATE cost him the value of his vested stock interest in the company, which was valued at roughly $17 million at the time of his departure.
The accusations and lawsuit against iGATE come hot on the heels of the IT company’s acquisition of a five year, $80 million contract with Swiss mobile network company Orange Communications SA.
Orange employs 939 employees, spread among 2,700 outlets and 94 centers in Switzerland, including a data center in Zurich. The contract, which was highly sought after, was awarded to iGATE mainly so that they can help strengthen Orange’s IT infrastructure.
“In its partnership with Orange Switzerland, iGATE will take responsibility for transforming and managing all enterprise systems, including ERP, Business Intelligence, Infrastructure and Data Network & Telephony services,” iGate said in a press release.
Orange’s mobile network already reaches about 99% of Switzerland’s entire population. Their contract with iGATE leaves open the option of a one-year extension after the initial five years have run their course.