LONDON (Reuters) – Hewlett-Packard (HP) lost more than $4 billion following its acquisition of British software company Autonomy due to a fraud engineered by co-founder Michael Lynch to increase the company’s value, HP’s lawyers told a London court on Monday.
HP is seeking to recoup its losses in a lawsuit filed against Mike Lynch, once considered Britain’s answer to Bill Gates, and former Autonomy CFO Sushovan Hussain.
The US tech giant bought Autonomy for $11.1 billion in 2011, in one of the UK’s largest industry deals. However, the deal collapsed spectacularly, with HP reducing Autonomy’s value to $8.8 billion within a year.
At the end of one of the longest civil trials in English legal history, HP won its case in 2022. A judge of the High Court of Justice, however, declared that the possible damages would be significantly lower than the 5 billion of dollars claimed by HP.
HP’s lawyers argued Monday that losses from the fraud entitle it to about $4 billion.
For his part, Mike Lynch, extradited to the United States last year to face criminal charges related to the deal, with a trial due to begin next month, says HP suffered no real losses, and denies any wrongdoing.
Its lawyer, David Wolfson, said in court that the price HP would have paid “would not have been materially different,” in part because of Autonomy’s unique technology and HP’s strategic logic for the acquisition .
According to his attorney, Mike Lynch intends to appeal the 2022 decision, which has been delayed until damages are determined.
Lawyers representing Sushovan Hussain, who was convicted of fraud in the United States and sentenced to five years in prison in 2019, said he agreed with the arguments made by Mike Lynch.
(Reporting by Sam Tobin; Mathias de Rozario, editing by Kate Entringer)
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