Business and tech

HP v Lynch : UK’s biggest civil fraud trial

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The civil action lawsuit was brought on by technology company Hewlett-Packard Enterprise(HP) against Dr. Mike Lynch in March 2019. The subject of this lawsuit was the fraudulent nature of the business dealings that occurred within Autonomy, the software company that was purchased by HP in October 2011 from the founder, Dr. Mike Lynch for $11.7 billion. This lawsuit isn’t the only one that the former officials of Autonomy have faced.

Autonomy’s ex-Chief Financial Officer, Sushovan Hussain was charged and found guilty of inflating the revenue of the company in 2019. Basically, it was accounting fraud. Apparently, he had used complicated methods to achieve a false growth of Autonomy’s revenue. Mr.Hussain was jailed for five years and had to pay a very heavy fine of $4m. He is also one of the defendants in the civil fraud trial case that took place in the US.

The main mastermind behind Autonomy, Dr. David Lynch was also charged with fraud in 2018, where he denied all the allegations against him and contested extradition. In March 2019, HP brought a civil lawsuit against Dr.David Lynch and Mr.Sushovan Hussain, and Lynch was cross examined for 22 days, making it one of the longest in British legal history. In January 2022, the High Court judge, Mr.Justice Hildyard, stated that HP had “substantially” succeeded in their case, also indicating that the company would receive a lesser amount than what they asked for, the amount being $5bn. Dr.Lynch is proclaiming that it was HP who mismanaged the company’s financial affairs after the 2011 deal. However, the proof is in the pudding. Autonomy had disguised its true financial state two years prior to the acquisition by HP. The value of Autonomy was actually $9bn and not $11bn, which was the price that HP had paid and from which Dr.Lynch made an estimated $800m profit. This was the man that was touted as the Bill Gates of the UK.

On the 26th of January 2022. Home Secretary Priti Patel, who was waiting until Justice Hildyard’s ruling, made a decision to approve the extradition of, Dr.David Lynch, to the US, where he faces criminal charges related to fraud. Although it seems that this bitter court case is over, Mr.Lynch’s lawyers are ready to challenge this order and will file an appeal opposing the extradition, to the High Court of London.

Written by: jaimmynanayakkara@yahoo.com

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