Mike Lynch counter sues HP for $150 million
Mike Lynch, co-founder of Autonomy Corporation and the founder of Invoke Capital, has sued tech giant Hewlett-Packard for $150 million over allegations the US company made about financial mismanagement.
Hewlett-Packard acquired the software company Autonomy in 2011.
Shortly after the acquisition HP announced a write down of assets due to “disclosure failures and outright misrepresentations at Autonomy”, which occurred before the acquisition.
The write down amounted to $8.8 billion of the purchase cost of over $10 billion.
The deal cost HP shareholders billions of dollars in value.
HP claims that Lynch and his colleagues manufactured a scheme to make it look as though Autonomy was growing rapidly as a pure software company.
However, Lynch claims that HP was well aware of the fact that Autonomy wasn’t strictly a software company. In fact, the accounting firm Deloitte have gone on the record supporting Lynch’s opinion and the FT uncovered documents that indicate HP was actually aware of Autonomy’s hardware sales.
Lynch said that HP has made numerous statements that were highly damaging to him.
He told Reuters: “HP’s own documents, which the court will see, make clear that HP was simply incompetent in its operation of Autonomy, and the acquisition was doomed from the very beginning,”
Lynch said that he hopes HP chief executive Meg Whitman will appear in court.
“This is about dragging them to be accountable, to actually explain the chaos, the mismanagement and the internal warfare, and then the attempt to cover it up,” he added.
Meanwhile, HP has called Lynch’s lawsuit a “laughable and desperate attempt to divert attention from the $5 billion lawsuit HP has filed and the ongoing criminal investigation”.
An HP spokeswoman said that the company “anxiously looks forward to the day Lynch and Hussain will be forced to answer for their actions in court,”