Lathika Pai, a respected figure within the Indian startup ecosystem, has filed a civil lawsuit against her former employer, Microsoft India, Microsoft Corporation, and the company’s senior officials, including Microsoft India president Puneet Chandok and human resources head Arun Kakatkar. Through her lawsuit, she is seeking Rs 35.3 crore in damages.
The lawsuit was first heard in the Delhi High Court on May 7, 2025. However, Microsoft’s legal team challenged the court’s jurisdiction over the case. The case has now moved to the Bengaluru civil court, with the first hearing scheduled for June 9, 2025.
A controversial initiative
In her lawsuit, Pai claimed that she was forced to resign due to a hostile work environment, retaliation, and procedural unfairness, labelling it as “constructive dismissal.” She alleged that she had been subjected to intimidation and professional isolation for months after an internal investigation in the flagship startup initiative called “Highway to a 100 Unicorns,” that she was leading.
The initiative in question was launched by Microsoft in 2019 in a bid to support early-stage startups in small cities by working alongside the state governments. In late 2019, Microsoft launched an internal investigation into the project after receiving anonymous allegations of vendor favouritism and financial irregularities. The investigation, an internal probe conducted by Microsoft’s compliance teams, seemingly cleared Pai. She was even promoted to the position of Country Head, Venture Capital and Private Equity Partnerships in March 2022.
Tensions after the second investigation
A second investigation was launched into “Highway to a 100 Unicorns” in March 2024, this time led by Morgan Lewis & Bockius, a US-based law firm. During this investigation, Pai claimed that she was denied access to the original complaints and transcripts from the first investigation. She added that, in April 2024, an interview was conducted regarding the investigation, but it was not recorded, which is against Microsoft’s policy.
Pai added that her objections to the process led her to face hostility from the company. She alleged that she was labelled a “troublemaker,” removed from key forums, and her contributions were publicly ignored. Pai further claimed that Microsoft treated her refusal to hand over her personal phone during the second course of investigation as non-cooperation, despite the lack of a legal basis. Referencing the initiative, Pai added that Microsoft’s leadership viewed partnerships with state governments with suspicion, which might have led to increased scrutiny over her.
The 2020 cyberbullying incident
In the lawsuit, Pai also talked about a 2020 cyberbullying incident. She claimed that the company had promised to conduct a proper forensic investigation into a complain she lodged in 2020 but failed to deliver.
Compensation for damages
Pai stated that after eight months of “harassment,” she filed her resignation in July 2024. She claimed damage to her mental health, reputation, and professional standing. As such, through her lawsuit, she is seeking compensation for loss of income, emotional distress, and reputational harm.