Cognizant faces class action lawsuit in US

BENGALURU/CHENNAI:A New York-based investor rights law firm has filed a class-action lawsuit on behalf of the shareholders of Cognizant Technology Solutions (CTS).

The lawsuit filed by Rosen Law Firm alleged that the Nasdaq-listed company lacked effective internal control over financial reporting, improper payments made for licenses for some of its 12 facilities in the country.

“As a result, defendants' statements about Cognizant's business, operations and prospects were materially false and misleading andor lacked a reasonable basis at all relevant times,“ the lawsuit said.

Another law firm, Goldberg Law, recently advised investors with losses to contact the law firm. The Los Angeles-based Goldberg represents shareholder rights litigation.

A few days ago, Cognizant, in a regulatory filing, said it was conducting an internal probe whether certain payments relating to facilities in India flouted the US Foreign Corrupt Practices Act and other laws. The filing said the audit committee, with the assistance of outside counsel, was conducting the probe into a small number of companyowned facilities.