Software titan HP has been accused of displaying a “case study in buyer’s remorse” following its disastrous $11bn (£8.3bn) takeover of British tech firm Autonomy, as a blockbuster lawsuit draws to a close.
HP got cold feet after the deal and is now lashing out for someone to blame, according to lawyers acting for Autonomy founder Mike Lynch.
The US company wrote down almost the entire value of Autonomy less than a year after buying it, and is seeking $5bn from Mr Lynch and his former finance chief. It claims a “revenue pumping” scheme took place inside the company. The pair deny the allegations.
Acting for Mr Lynch, Robert Miles QC claimed HP’s board “buckled to the pressure” and “lost their corporate nerve” following the announcement of the deal in 2011 – then sought a way to undo the transaction.
HP fired chief executive Léo Apotheker and replaced him with Meg Whitman, who focused on “consolidation rather than transformation,” Mr Miles alleged.
The barrister also accused Cathie Lesjak, HP’s former chief financial officer, of “not giving truthful evidence” when she claimed that HP had worked out a detailed methodology for why so much value was written off Autonomy.
Mr Miles accused HP of lumping Mr Lynch in with other management decisions to “blur the question of who was actually involved” in decisions at Autonomy.
He invited the court to use highlighter pens to identify where HP directly accuses Mr Lynch of wrongdoing in its closing argument.
Mr Miles said: “You won’t use very much ink."
The barrister also claimed that Mr Lynch did not need to carry out any fraud at Autonomy because he was already “very successful and wealthy” before the company’s sale to HP.
“He didn’t need to go out and trick anybody,” Mr Miles said.
Mr Lynch’s closing argument is the final stage of a civil trial at the High Court, with a judgement is expected in the Spring.
The technology executive also faces separate criminal charges filed by the US government, which has accused him of wire and securities fraud and conspiracy. Mr Lynch denies the charges.
The American Embassy has submitted an extradition request to the Home Office, although sources close to Mr Lynch believe it is unlikely that he will be arrested before the conclusion of High Court proceedings.
The trial continues.