Autonomy's Mike Lynch to sue HP for damages

Lynch seeks damages of more than $150m in London over 'false and negligent statements' made by HP

Former Autonomy CEO Mike Lynch has today filed a lawsuit against HP in the UK High Court seeking damages in excess of $150m.

The damages, his legal team claims, were caused by what they call "false and negligent statements made about him and the Autonomy management team" by HP on 20 November 2012 and in HP's "subsequent public smear campaign".

Lynch, who founded Autonomy in the late 1990s, has vigorously contested HP's claims that he and his management team had misled HP about the true financial health of Autonomy.

Last week, documents were released that indicated that HP was aware about many of Autonomy's accounting practices, which HP claimed was misleading.

"Over the past three years, HP has made many statements that were highly damaging to me and misleading to the stock market. Worse - HP knew, or should have known, these statements were false," said Lynch today.

He continued: "We are finally starting to see what really happened with Autonomy. 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.

"Evidence shows that at the time of the acquisition, HP was in chaos. Before going ahead with the acquisition they discussed firing their CEO. They then tried to abort the deal after closing, [they] ultimately did fire the CEO, and generally fought among themselves like cats in a sack, causing Autonomy to disintegrate."

Autonomy had reportedly been offered for sale to Oracle for around $5bn, a deal that the then Oracle CEO Larry Ellison had rejected, arguing that it overvalued the company. Oracle lampooned Autonomy by releasing a series of documents that it claims prove that Autonomy had been offered for sale to the software giant.

HP subsequently "swooped" for $11.1bn in August 2011, although the documents released last week indicate that there was a wide degree of doubt and uncertainty within HP over the wisdom of the deal.

Lynch, though, claims that if HP overpaid for Autonomy, it wasn't because of any wrong-doing on his part or anyone else at the company.

"HP wasn't misled by us or anyone else - evidence will show they didn't even read their own due diligence report.

"Tragically, Autonomy is only one deal among the many that were mishandled by HP, which has written down $9bn on three separate occasions since 2011. Every acquisition over a billion dollars that HP has made in the last five years has failed," said Lynch.

He concluded: "Meg Whitman can explain all this to a judge when we finish this in court once and for all."