Beauty and fashion retailer Nykaa has filed a lawsuit against its former Chief Business Officer (CBO), Gopal Asthana, accusing him of breach of confidentiality, misappropriation of proprietary data, and efforts to harm the company’s business interests. The legal action was taken in the Bombay High Court, as reported by The Economic Times.
Nykaa alleges that Asthana, who is now the CEO of Tata Cliq, the fashion arm of Tata Digital, recruited several former Nykaa employees who had worked under him. Over the past year, multiple employees have reportedly moved from Nykaa to Tata Cliq.
In its petition, Nykaa asserts that Asthana, who served as CBO for four years and was a board member, had access to sensitive and confidential information due to his senior role. The company also noted that Asthana was compensated with substantial remuneration, including long-term incentives and employee stock options.
Asthana has responded to the allegations, describing them as “incorrect” and stating that they will be addressed through arbitration.
The Bombay High Court has issued an interim order prohibiting Asthana from hiring Nykaa executives for Tata Cliq. However, Nykaa has not included Tata Digital in this petition.
Nykaa, led by CEO Falguni Nayar, is seeking a refund of Rs 19 crore for the employee stock options benefits granted to Asthana, along with an additional Rs 5 crore for damages related to loss of goodwill and other business impacts. The company has also requested the court to prevent Asthana from using any confidential Nykaa data in his role at Tata Cliq.
This lawsuit highlights the growing competition in the beauty, fashion, and accessories sectors, with key players like Tata Cliq, Nykaa, Myntra, Amazon Fashion, and Reliance Ajio battling for market dominance.
Summary:
- Nykaa has filed a lawsuit against former CBO Gopal Asthana, accusing him of breaching confidentiality and misappropriating proprietary data.
- The Bombay High Court has issued an interim order to prevent Asthana from recruiting Nykaa employees for Tata Cliq.
- Nykaa seeks Rs 19 crore for stock options benefits and Rs 5 crore for damages, while also requesting a restraining order against the use of confidential data.