3/28/2024 0 Comments Steven schwartz connecticut![]() ![]() Cognizant Stops Advancement Payments and Schwartz Sues. 3 resigned soon after.9 The Company acknowledged its obligation to advance fees to Schwartz’s counsel in connection with the investigations in late October 2016.10 B. In April 2016, Cognizant began investigating potential internal violations of the Federal Corrupt Practices Act (the “FCPA”) involving alleged bribery payments to government officials in India.5 Schwartz initially led the investigation.6 He was removed from that role in August 2016 when Cognizant learned that he may have been involved in unlawful conduct.7 In September 2016, Cognizant reported certain findings from its internal investigation to the Department of Justice and the Securities and Exchange Commission, and each began its own investigation.8 Schwartz retained counsel and 4 Indemnification Agreement § 23. Schwartz Is Investigated and Cognizant Begins Advancement Payments. 3 2 pursuant to Section 14(a) of this Agreement, the Company and Indemnitee hereby irrevocably and unconditionally (i) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the Delaware Court, and not in any other state or federal court in the United States of America or any court in any other country (ii) consent to submit to the exclusive jurisdiction of the Delaware court for purposes of any action or proceeding arising out of or in connection with this Agreement. G (“Indemnification Agreement”) § 10 (Dkt. 2 Cognizant, About Cognizant, (last visited March 24, 2022). Except with respect to any arbitration commended by Indemnitee 1 Verified Compl. Schwartz, is the former Executive Vice President, Chief Legal and Corporate Affairs Officer of defendant Cognizant Technology Solutions Corporation (the “Company”).1 Cognizant is an American multinational information technology services and consulting company headquartered in Teaneck, New Jersey and incorporated in Delaware.2 Schwartz and Cognizant signed an Indemnification Agreement on Jthat requires Cognizant to advance legal expenses incurred by Schwartz by reason of the fact that he was a Cognizant officer.3 The Indemnification Agreement contains a Delaware forum selection provision: This Agreement and the legal relations among the parties shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflict of laws rules. The plaintiff has not identified any violation of this court’s advancement orders that could support such relief. I also decline to hold Cognizant in contempt. But the New York federal 1 court-not this court-must determine whether it is a proper forum for Cognizant’s fraud claims. The plaintiff asserts that this case is different because of the potential application of a Delaware forum selection provision. It is well settled that a state court lacks the power to enjoin a party from proceeding with in personam litigation in a federal court that has jurisdiction. ![]() For the reasons explained in this opinion, I deny the plaintiff’s motion for an anti-suit injunction. Meanwhile, his counsel has moved to dismiss the New York federal action on grounds including forum non conveniens because the plaintiff’s indemnification agreement contained a Delaware forum selection provision. The plaintiff subsequently filed the present action, seeking an anti-suit injunction and a finding of civil contempt. In July 2021, Cognizant again accused the plaintiff’s counsel of fraudulent billing practices and sued that counsel in New York federal court, invoking diversity jurisdiction. Cognizant has since honored its advancement obligations. In April 2020, the court entered an order largely in the plaintiff’s favor. The plaintiff previously sought advancement in this court after Cognizant had accused the firm of fraudulent billing practices and stopped advancing the firm’s fees. O’Neil, QUINN EMANUEL URQUHART & SULLIVAN, LLP Counsel for Defendant Cognizant Technology Corporation WILL, Vice Chancellor The plaintiff, a former officer of Cognizant Technology Solutions Corporation, asks this court to enjoin Cognizant from pressing fraud claims against a law firm representing the plaintiff in other matters. Christian Word, LATHAM & WATKINS LLP, Washington, DC Luke Nikas, QUINN EMANUEL URQUHART & SULLIVAN, LLP, New York, New York William A. Ross and Anthony Calvano, ROSS ARONSTAM & MORITZ LLP, Wilmington, Delaware J. Dalton, DALTON & ASSOCIATES, P.A., Wilmington, Delaware Adam Balick and Michael Collins Smith, BALICK & BALICK, LLC, Wilmington, Delaware Counsel for Plaintiff Steven E. 2021-0634-LWW MEMORANDUM OPINION Date Submitted: JanuDate Decided: MaBartholomew J. COGNIZANT TECHNOLOGY SOLUTIONS CORPORATION, a Delaware Corporation Defendant. ![]() IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE STEVEN E. ![]()
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