Former Autonomy CEO Mike Lynch arrives at the federal court in San Francisco, California, Monday, March 18, 2024.
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A San Francisco jury on Thursday acquitted Autonomy founder Mike Lynch of fraud charges, a major victory for the entrepreneur. HP In 2011 it was US$11 billion.
Representatives for Lynch and the U.S. Attorney said Lynch was acquitted of all 15 charges, including one count of conspiracy and 14 counts of wire fraud, each related to a specific transaction or communication.
Former Autonomy finance chief Stephen Chamberlain, who faced the same charges at trial as Lynch, was also acquitted on all counts, Lynch’s representatives said.
The trial is the latest chapter in a legal saga that prosecutors say Lynch and Chamberlain conspired to inflate Autonomy’s earnings.
The sale of Autonomy was one of the largest technology deals in the UK at the time, but it quickly fell through, with HP writing down Autonomy’s value by $8.8 billion within a year.
During the trial, which lasted three months, jurors heard testimony from more than 30 government witnesses, including former HP CEO Leo Apotheker, who was fired weeks after the Autonomy deal was announced.
Lynch also took the stand in his own defense at the trial, denying wrongdoing and telling jurors that HP botched the integration of the two companies.
Prosecutors said Lynch and Chamberlain enriched Autonomy’s finances in a variety of ways, including through backdating agreements and “round-trip” transactions that provided cash to customers through sham contracts.
Lynch’s legal team argued at trial that HP was so eager to acquire Autonomy before potential competitors that it rushed to conduct due diligence before the sale.
The Cambridge-educated entrepreneur told the witness box that he had been focusing on technology issues and had delegated funding matters and related accounting decisions to Sushovan Hussain, Autonomy’s then chief financial officer.
Hussein was separately convicted in 2018 at a trial in the same court on charges related to the HP deal. He was released from a U.S. prison in January after serving a five-year sentence.
Lynch is one of the UK’s leading tech entrepreneurs who will apple Co-founder Steve Jobs and Microsoft Co-founder Bill Gates.
Lynch transformed ground-breaking research at Cambridge University into the basis of Autonomy, which became the UK’s largest software company and a blue-chip member FTSE 100 index.
He has been praised by academics and scientists and has been asked to advise the UK government on technology and innovation.
The acquisition of Autonomy is aimed at boosting HP’s software business. Instead, it set off a series of painful and expensive legal battles.
In 2022, HP largely won a civil lawsuit against Lynch and Hussain in London, but the amount of damages has not yet been determined. The company is seeking $4 billion.
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