The settlement, formalized in a November 25, 2025, stipulation, requires the defendants' insurers to pay the $5.5 million sum into a fund for the benefit of the company. This resolution follows years of legal maneuvering in the case Palempalli v. Patsalos-Fox, et al. Because this is a derivative action rather than a class action, individual stockholders will not receive direct monetary payouts from the settlement fund.
Cognizant Reaches $5.5 Million Settlement in Derivative Lawsuit
Cognizant Technology Solutions has agreed to a $5.5 million settlement to resolve a long-standing stockholder derivative action. Filed in the U.S. District Court for the District of New Jersey, the agreement concludes litigation brought by plaintiff Viswanatha Palempalli against numerous current and former company officers and directors.
Plaintiff's counsel plans to request up to $1,830,000 in attorneys' fees and expenses from the fund, alongside a $15,000 service award for the plaintiff, both of which require court approval. The Honorable Stacey D. Adams is scheduled to preside over a settlement hearing on September 14, 2026, in Newark, New Jersey. Stockholders wishing to contest the terms or the requested fee allocations must submit formal written objections to the court by August 31, 2026.
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