Mike Lynch, the British founder of software firm Autonomy, has been acquitted of fraud by a jury in San Francisco. Lynch had faced over 20 years in prison for inflating the value of Autonomy ahead of its sale to Hewlett-Packard in 2011. Lynch denied the charges and claimed that he had focused on technology rather than accounting. Autonomy was ultimately sold to HP in 2011 for $11bn, which at the time was the largest-ever takeover of a UK tech company. Lynch made £500m from the sale. A year later, HP wrote the value of Autonomy down by $8.8bn, leading to years of legal battles.
Lynch’s former CFO was found guilty of fraud in 2018 and sentenced to five years in prison. US prosecutors accused Lynch of using backdated agreements to inflate the firm’s value, concealing losses from its hardware business and intimidating people who raised concerns. After a civil fraud case was ruled against him in the UK in 2022, Lynch was extradited to the US. HP is seeking $4bn from Lynch in that case. Lynch, a former adviser to the UK government, had faced house arrest in the US while preparing for the trial.
Dozens of witnesses, including HP’s former CEO Leo Apotheker, were called by prosecutors during the trial. However, Lynch’s defence team successfully argued that HP had failed to properly vet the deal and had mismanaged the takeover. Lynch testified that he had been uninvolved with the transactions being described. Lawyers for Lynch described the trial as a “relentless 13-year effort to pin HP’s well-documented ineptitude on Dr Lynch”. Lynch praised the jury for their attention to the facts over the last ten weeks and pledged to return to innovation and his family in the UK
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