Bangalore: Mahindra Satyam is suing former directors, auditors and employees of Pricewaterhousecoopers (PwC) and B. Ramalinga Raju, founder of Satyam Computers, for an undisclosed amount, seeking compensation for damages, reports Reuters. This lawsuit is based on the 'window dressing’ scandal involving Satyam and PwC in 2009.

Mahindra Satyam has filed a lawsuit against PwC in a Hyderabad court, seeking damages for "Inter-alia perpetrating fraud, breach of fiduciary responsibility, obligations and negligence in performance of duties." According to Times of India, Mahindra Satyam intends to drag 123 PwC execs and partners of PwC, both in India (Hyderabad, Kolkata, Bangalore and Mumbai offices) and the U.S. to court. Lovelock & Lewes is also being sued over this matter. Other Satyam employees being sued are – Prabhakar Gupta, former Internal Auditor; Vadlamani Srinivas, Chief Financial Officer; G. Ramakrishna, former Finance Vice-president and D. Venkatapati Raju and Ch. Srisailam, employees of the finance department.

Though the fixed amount of money being seeked as damages has not been explicitly mentioned, Vineet Nayyar, Chairman of Mahindra Satyam, told TOI that the compensation amount is more than $210 million. Nayyar said, "Though we haven't specified the damages because we don't know the exact magnitude of damages, some are known to us and easily quantifiable. And then there are damages resulting from loss of business, customers, reputation that add up to quite a bit but are difficult to quantify." Nayyar further said "Obviously we have angst against the previous management and auditors who had a fiduciary responsibility. It is only right and fair that they should compensate the company." He said that the lawsuit took almost 3 years to take shape as Mahindra Satyam had to sort out existing liabilities and formalities.

Dhanya Ann Thoppil and Romit Guha of Wall Street Journal report that PwC has sued Mahindra Satyam in turn for more than $1 billion, seeking damages sustained by it because of Ramalinga Raju. PwC quoted, “PW India is outraged that Satyam is attempting to shift responsibility to the auditors for the consequences of a carefully and deliberately concealed fraud that was undertaken at the direction of its own senior management."

Wall Street reports that shares of Mahindra Satyam increased by 2.3 percent, upon the news of it suing PwC. Analysts owe this rise to renewed faith of investors in the company. Investors believe that the company will be able to recover a decent amount of money from the lawsuit.  

K.V. Kurmanath and K. R. Srivats of Business Line report that - “The fraud perpetrated by Satyam was specifically designed to — and did — circumvent Satyam’s own internal controls and PW India’s audit process, and consequently PW India was a victim of Satyam’s fraud, and will defend itself vigorously against Satyam’s baseless contentions,” said by PwC.