Top Class Actions’s website and social media posts use affiliate links. If you make a purchase using such links, we may receive a commission, but it will not result in any additional charges to you. Please review our Affiliate Link Disclosure for more information.
Cognizant Stock Prices Class Action Settlement Overview:
- Who: Cognizant Technology Securities Corp. reached a $95 million settlement agreement with investors.
- Why: Investors claim Cognizant’s stock dropped 13 percent after it informed them it was being investigated for potentially violating the federal Foreign Corrupt Practices Act.
- Where: The class action lawsuit and settlement were heard in New Jersey federal court.
Cognizant has reached a $95 million class action settlement with investors who alleged stock prices tumbled after the company was investigated for bribing Indian officials to get building permits.
Investors claim Cognizant’s stock price dropped more than 13 percent after it informed them it was being investigated for potential violations of the federal Foreign Corrupt Practices Act because of its dealings in India.
A complaint was also filed against Cognizant by federal prosecutors and the U.S. Securities and Exchange Commission (SEC), which alleged the company had a contractor pay off a government official to get it the proper planning permit needed to build an office campus in Chennai, India, where the company would enjoy labor benefits and tax breaks.
Cognizant Stock Prices Class Action Settlement
Cognizant was unable to come to an agreement with investors after going through mediation in February, according to the motion, but both sides ultimately agreed to go with the mediator’s recommendation of $95 million in August.
The class action settlement will be paid on behalf of all defendants, including two of its former executives — president Gordon Coburn and chief legal and corporate affairs officer Steven Schwartz — and deposited into an interest-bearing escrow account within 20 days of preliminary approval.
Coburn and Schwartz have both pleaded not guilty to criminal charges filed against them by federal prosecutors, arguing they were not involved in the bribery scheme, according to the motion.
The SEC’s complaint has been paused pending the results of the criminal investigation, according to Law360, which reported that a federal judge in New Jersey previously denied three separate motions filed by Cognizant to dismiss the case.
Cognizant settled a separate class action lawsuit for $5.7 last year after a group of employees alleged the company failed to pay them overtime they were owed.
Do you believe the $95 million class action settlement between Cognizant and its investors is sufficient to cover the alleged stock price drop? Let us know in the comments!
The investors are represented by John Rizio-Hamilton, Abe Alexander, and Jesse Jensen of Bernstein Litowitz Berger & Grossman LLP, and Michael B. Himmel and Michael T.G. Long of Lowenstein Sandler LLP.
The Cognizant Stock Prices Class Action Lawsuit is In re: Cognizant Technology Solutions Corporation Securities Litigation, Case No. 2:16-cv-06509, in the U.S. District Court for the District of New Jersey.
Don’t Miss Out!
Check out our list of Class Action Lawsuits and Class Action Settlements you may qualify to join!
Read About More Class Action Lawsuits & Class Action Settlements:
- Schwab Robo-Advisor Users Blame Investment Giant for $500 Million Investment Loss in New Class Action Lawsuit
- Robinhood Stock Halt Class Action Denied Class Certification on Technicality
- Oppenheimer Hid $110 Million Ponzi Scheme, Says Investors’ Class Action
- Cryptsy Cryptocurrency Class Action Settlement
