British tech tycoon Mike Lynch has been cleared of fraud charges over the multi-million dollar sale of his company Autonomy to HP.
The founder of Autonomy was acquitted by a jury in San Francisco on Thursday, in a major victory for the businessman who has been dogged by legal problems since the disastrous $11 billion sale of his company in 2011.
Representatives for Lynch and U.S. prosecutors said Lynch was acquitted of all 15 charges: one count of conspiracy and 14 counts of wire fraud, each related to specific transactions or communications.
Former Autonomy financial executive Stephen Chamberlain, who faced the same charges in the trial along with Lynch, was also acquitted of all charges, Lynch's representative said.
The trial in which prosecutors said Lynch and Chamberlain schemed to inflate Autonomy's revenue was the latest chapter in a legal saga stemming from the failed deal.
The sale of Autonomy was one of the biggest British technology deals at the time, but it quickly soured, with HP writing down Autonomy's value by $8.8 billion in a year.
In the three-month trial, jurors heard from more than 30 government witnesses, including Leo Apotheker, the former HP CEO who was fired weeks after the Autonomy deal was announced.
Lynch also took the stand in his own defense at trial, denying wrongdoing and telling the jury that HP botched the integration of the two companies.
Prosecutors said Lynch and Chamberlain bolstered Autonomy's finances in several ways, including backdating deals and “round-trip” deals that delivered cash to customers through sham contracts.
Lynch's legal team argued at trial that HP was so eager to acquire Autonomy before its potential competitors that it rushed through due diligence before the sale.
On the stand, the Cambridge University-educated businessman said he had focused on technological issues and had entrusted the monetary matters and accounting decisions in question to Sushovan Hussain, Autonomy's then chief financial officer.
Hussain was convicted separately in 2018 at a trial in the same court on charges related to the HP deal. He was released in January after serving a five-year sentence.
Lynch was one of the UK's leading technology entrepreneurs, and was compared to Apple co-founder Steve Jobs and Microsoft co-founder Bill Gates.
Lynch turned groundbreaking research at Cambridge into the basis of Autonomy, which became Britain's largest software company and a member of the blue-chip FTSE 100 index.
He was praised by academics and scientists and was asked to advise the British government on technology and innovation.
The Autonomy acquisition was intended to boost HP's software business. Instead, it spawned a series of bitter and costly legal battles.
HP largely won a civil lawsuit against Lynch and Hussain in London in 2022, although damages have not yet been decided. The company is seeking $4 billion.
