British tech pioneer Mike Lynch acquitted in US fraud trial By Reuters

Author: Abhirup Roy, Jody Godoy

(Reuters) – Autonomy founder Mike Lynch was acquitted of fraud charges by a jury in San Francisco on Thursday. This compared to $11 billion in 2011 when his company, Hewlett-Packard (HP (NYSE: NYSE: )).

Lynch’s representatives and the U.S. Attorney’s Office said Lynch was acquitted of all 15 charges, including one count of conspiracy and 14 counts of wire fraud. Each charge relates to a specific transaction or communication.

Stephen Chamberlain, a former Autonomy financial executive who was tried along with Lynch on the same charges, was acquitted on all counts, a Lynch spokesman said.

The trial, where prosecutors said Lynch and Chamberlain schemed to inflate Autonomy’s profits, was the latest chapter in a legal saga stemming from the failed deal.

The sale of Autonomy was one of the largest technology deals in the UK at the time, but it quickly soured, with HP valuing Autonomy at $8.8 billion within a year.

Lynch, who was once compared to Apple (NASDAQ:) co-founder Steve Jobs and Microsoft (NASDAQ:) co-founder Bill Gates, said in a statement that he was “pleased with today’s ruling.” “I’m looking forward to returning to the UK and getting back to what I love most: my family and innovation in my field.”

“We recognize and respect this ruling,” said Abraham Simmons, a spokesman for the U.S. Attorney’s Office.

During the three-month trial, 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 represented himself at trial, denying wrongdoing and telling jurors that HP interfered with the integration of the two companies. Prosecutors said Lynch and Chamberlain financed Autonomy in a variety of ways, including retroactive contracts and “round-trip” transactions that advanced 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 its due diligence before the sale. The Cambridge University-educated entrepreneur said on the stand that he was focusing on technology issues and had left problematic money matters and accounting decisions to Sushovan Hussain, who was Autonomy’s chief financial officer at the time. Hussein was separately convicted in a trial at the same court in 2018 on charges related to his dealings with HP. He was sentenced to five years in prison and was released from a U.S. prison in January.

Lynch turned his groundbreaking research at Cambridge into the foundation of Autonomy, which became Britain’s largest software company and a member of the Blue Chips.

He has received praise from academics and scientists and has been asked to advise the UK government on technology and innovation. The acquisition of Autonomy was intended to revitalize HP’s software business. Instead, it sparked a series of bitter and expensive legal battles. HP won a major civil suit against Lynch and Hussein in London in 2022, but the amount of damages has not yet been determined. The company is seeking $4 billion.