HP has (finally) filed a $5 billion lawsuit against Autonomy's management - and those execs are suing back
And on Tuesday, the former managers of Autonomy, including cofounder Mike Lynch, announced that they were filing a counter lawsuit against HP for at least £100 million (about $147 million) over what they consider HP's "smear campaign."
For years, HP has been saying it was duped when it bought Autonomy for $11 billion cash. HP says it found about $5 billion worth of weird transactions on the books after the sale - HP called it "fraud" - and that it was going to take Autonomy executives to court.
A little more than a year after the deal closed, when HP's stock was hovering around $15, HP wrote off $8.8 billion worth of the acquisition. It blamed Autonomy's books, saying Autonomy had overstated its revenues.
Autonomy officials have loudly proclaimed they are not to blame, although during the many investigations into Autonomy's books, there were some transactions that were questioned. For instance, a lawsuit filed on behalf of Autonomy's former CFO, Sushovan Hussain, mentioned $8.4 million worth of questionable transactions. Still, that's a far cry from $5 billion.
Meanwhile, HP was slammed with shareholder lawsuits, here and in the UK. And HP has been jumping through some pretty serious hoops trying to settle them before it splits into two companies in the fall.
One deal, for instance, involved hiring the lawyers that was suing HP on behalf of shareholders to help HP make a case against former Autonomy executives instead. HP agreed to pay these lawyers up to $48 million for that work. Hussain was suing to try and stop that deal from going forward.
HP has never wavered in its statements that it would sue, and both sides have been liberally throwing verbal barbs at each other. On Monday, it finally sued, the company confirmed to Business Insider.
A spokesperson sent us this statement.
HP can confirm that, on March 30, a Claim Form was filed against Michael Lynch and Sushovan Hussain alleging they engaged in fraudulent activities while executives at Autonomy. The lawsuit seeks damages from them of approximately $5.1 billion. HP will not comment further until the proceedings have been served on the defendants.
And here's the statement sent to us on Tuesday from Lynch's spokesperson announcing his £100 million lawsuit:
London 31 March 2015 - The former management of Autonomy announces today they will file claims against HP for loss and damage caused by false and negligent statements made against them by HP on 20 November 2012 and in HP's subsequent smear campaign. Former Autonomy CEO Mike Lynch's claim, which is likely to be in excess of £100 million, will be filed in the UK.