In San Francisco, entrepreneur Mike Lynch, the founder of Autonomy, has been cleared of fraud charges by a jury. This marks a significant victory for Lynch, who has faced legal troubles since the troubled sale of his company to Hewlett-Packard (HP) for $11 billion ($16.5 billion) in 2011.
Following the verdict, representatives for Lynch and US prosecutors confirmed his acquittal on all charges, which included a conspiracy charge and 14 counts of wire fraud related to specific transactions and communication.
Stephen Chamberlain, a former Autonomy finance executive who was also on trial alongside Lynch, was likewise found not guilty on all charges.
The trial focused on allegations that Lynch and Chamberlain engaged in fraudulent activities to inflate Autonomy’s revenue, adding another chapter to the legal saga following the failed HP deal.
The sale of Autonomy, a significant British tech transaction at the time, quickly soured with HP recording an $8.8 billion write-down of Autonomy’s value within a year.
During the three-month trial, over 30 government witnesses, including Leo Apotheker, the former HP CEO who was terminated shortly after the Autonomy acquisition, testified.
Lynch defended himself during the trial, asserting his innocence and highlighting HP’s mishandling of the companies’ integration.
Prosecutors claimed Lynch and Chamberlain artificially inflated Autonomy’s finances through backdated agreements and “round-trip” deals that funneled cash to customers through fake contracts.
Lynch’s legal team argued that HP’s zeal to acquire Autonomy led to rushed due diligence before the sale, pointing out that Lynch had entrusted financial matters to Sushovan Hussain, Autonomy’s former CFO.
In a separate trial in 2018 at the same court, Hussain was convicted on charges related to the HP deal and recently completed a five-year sentence in a US prison.
Lynch, a prominent figure in the UK’s tech industry, has been likened to Apple’s Steve Jobs and Microsoft’s Bill Gates.
He transformed innovative research at Cambridge into Autonomy’s foundation, propelling it to become Britain’s largest software firm and a FTSE 100 member.
Academics and scientists lauded Lynch, seeking his insights for advising the UK government on technology and innovation.
Although HP prevailed in a London civil suit against Lynch and Hussain in 2022, the damages remain undetermined, with the company pursuing $4 billion in compensation.
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