HP says Autonomy revenue was wrong by 38%

Ex-Autonomy CEO Mike Lynch responds by blasting lawsuit as "desperate search" for a scapegoat

A fresh war of words has erupted between HP and the former executives of Autonomy that it's suing for $5.1 billion, after details of the lawsuit were revealed in a court filing.

Hewlett-Packard last month launched a legal battle against Michael Lynch and Sushovan Hussain, the former CEO and CFO respectively of British software maker Autonomy.

HP bought Autonomy in 2011, but was forced to write down 5.6 billion of the 7 billion purchase, and accuses Lynch and Hussain of cooking the books to increase the British firm's apparent value.

In documents released yesterday, HP claimed it was tricked into paying 3.2 billion ($5.1 billion) more than it should have for Autonomy the same amount it wants repaid in the lawsuit it filed in England.

Advertisement
Advertisement - Article continues below
Advertisement - Article continues below

Specifically, the filing alleges that Autonomy sold other vendors' hardware at a loss, recognising the costs as "marketing" instead of "goods purchased".

HP also claimed revenues were falsely bumped up three years running by 24.7 per cent in 2009, by 38 per cent in 2010 and by 36 per cent in 2011.

Lynch responded by blasting HP, saying the claims are "one long disagreement over accounting treatments, and have nothing to do with fraud".

He added: "After three years of Meg Whitman's stonewalling, is this it? HP's claim is finally laid bare for what it is a desperate search for a scapegoat for its own errors and incompetence.

"She now admits that hardware sales were correctly recorded as revenue and that HP was fully aware of this when they valued the company at $11 billion," he said. 

Lynch added that there was no missing money from Autonomy's accounts.

Advertisement - Article continues below

The latest news comes after the Serious Fraud Office dropped an investigation into Lynch and Hussain back in January, saying there wasn't enough evidence for a successful prosecution. It passed on its findings to US authorities.

Featured Resources

What you need to know about migrating to SAP S/4HANA

Factors to assess how and when to begin migration

Download now

Your enterprise cloud solutions guide

Infrastructure designed to meet your company's IT needs for next-generation cloud applications

Download now

Testing for compliance just became easier

How you can use technology to ensure compliance in your organisation

Download now

Best practices for implementing security awareness training

How to develop a security awareness programme that will actually change behaviour

Download now
Advertisement

Recommended

Visit/hardware/354336/the-it-pro-products-of-the-year-2019-all-the-years-best-hardware
Hardware

The IT Pro Products of the Year 2019: All the year’s best hardware

24 Dec 2019
Visit/hardware/34588/hp-elite-dragonfly-hands-on-review-a-potential-xps-killer
Hardware

HP Elite Dragonfly hands-on review: A potential XPS killer

9 Oct 2019
Visit/laptops/34468/hp-elitebook-x360-830-g6-review-above-the-fold
Laptops

HP EliteBook x360 830 G6 review: Above the fold

26 Sep 2019
Visit/laptops/34198/hp-elite-x2-1013-g3-review-elite-in-name-but-not-in-nature
Laptops

HP Elite X2 1013 G3 review: Elite in name but not in nature

13 Aug 2019

Most Popular

Visit/policy-legislation/data-governance/354496/brexit-security-talks-under-threat-after-uk-accused-of
data governance

Brexit security talks under threat after UK accused of illegally copying Schengen data

10 Jan 2020
Visit/security/cyber-security/354468/if-not-passwords-then-what
cyber security

If not passwords then what?

8 Jan 2020
Visit/web-browser/30394/what-is-http-error-503-and-how-do-you-fix-it
web browser

What is HTTP error 503 and how do you fix it?

7 Jan 2020
Visit/policy-legislation/31772/gdpr-and-brexit-how-will-one-affect-the-other
Policy & legislation

GDPR and Brexit: How will one affect the other?

9 Jan 2020