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Phaneesh lawsuit casts a shadow

Mumbai, Oct. 10: Infosys Technologies today said a possible verdict against former executive Phaneesh Murthy in a harassment suit could crimp its financial condition.

The confession came amid reports that efforts to settle the case out of court with the plaintiff, a sacked woman employee, was not making much of a headway. “The results of such a lawsuit are difficult to predict. Infosys will vigorously defend the matter,” the company said in a release issued today. The remarks mark a U-turn from the earlier stand taken by CEO Nandan Nilekani that Murthy’s resignation — and hence his travails — would not have any “material impact”.

Murthy was replaced by Basab Pradhan, who was appointed as the new senior vice-president and head of worldwide sales. Murthy had resigned from the board and as head (sales/marketing and communications and product services) from July 23 to fight charges of “wrongful job termination and sexual harassment” against him and Infosys.

Reka Maxmovitch, the former Belgian working as an executive assistant to Murthy, filed her suit in the Alameda County Superior Court in Oakland on December 17, 2001. Infosys and Murthy tried to reach an off-court resolution to the lawsuit to stave off a trial.

Speaking to reporters in Bangalore at a press conference to unveil the second quarter results, T. V. Mohandas Pai, chief finance officer and board member, said the company had made a vain attempt to mediate.

Unlike the official line, Pai said he could not “say whether the company’s performance would be affected this year or the next”. “We are dealing with uncertainties. Nobody can predict what the court is going to decide.”

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