Court rules estate of Mike Lynch, who died when his yacht sank, owes HPE more than $940 million

CNN

4 days ago

Hewlett Packard is owed more than £700 million ($943 million) by the estate of late British tech tycoon Mike Lynch and his former finance director after they lost a fraud case involving Lynch's software company, a UK High Court judge ruled Tuesday.
The court's decision comes nearly a year after Lynch was killed when his superyacht sank off Sicily, where he had gathered with friends and family to celebrate his acquittal months earlier in a separate US criminal trial.
The US tech company, now known as Hewlett-Packard Enterprise (HPE), had accused Lynch of fraud and conspiracy after it bought Lynch's company, Autonomy Corp, for $11 billion.
HPE also took Lynch to court in the United Kingdom, seeking up to $4 billion in damages in a civil case. The High Court had ruled mostly in HPE's favor in 2022, but the judge had said that the amount awarded would be 'substantially less' than the company was seeking.
Judge Robert Hildyard was originally due to issue a draft ruling in September but delayed it after Lynch's yacht, the Bayesian, sank in the storm off Sicily on August 19. Lynch and his daughter were among seven people who died while 15 others survived, including the captain and most of the crew.
In a written judgment, Hildyard expressed his 'sympathy and deepest condolences' to Lynch's wife and family.
Hildyard said HPE suffered a loss of £646 million based on the difference between Autonomy's purchase price and what it would have paid had Autonomy's 'true financial position been correctly presented.'
HPE is also owed £51.7 million for 'personal claims related to deceit and/or misrepresentation' against Lynch and Sushovan Hussain, the finance director, and $47.5 million for other losses.
Hussain was convicted in a 2018 US trial of wire fraud and other crimes related to Autonomy's sale and sentenced to five years in prison.
'We are pleased that this decision brings us a step closer to the resolution of this dispute,' HPE said in a statement. 'We look forward to the further hearing at which the final amount of HPE's damages will be determined.'
A hearing to deal with interest, currency conversion and whether Lynch's estate can appeal is set for November.
In a statement written before his death and issued posthumously, Lynch said the ruling shows that HP's original claim 'was not just a wild overstatement – misleading shareholders – but it was off the mark by 80%.'
'This result exposes HP's failure and makes clear that the immense damage to Autonomy was down to HP's own errors and actions,' he said.