back to article The story so far: How's that Autonomy High Court battle with HPE looking at half-time?

Just how far has HPE come in proving its $5bn fraud allegations against former Autonomy CEO Mike Lynch and co-defendant CFO Sushovan Hussain? While the world basks in the summer sun, we had a close look at the last three months of court hearings to decide. Regular readers know all too well about the Autonomy trial, which has …

  1. Semtex451 Silver badge

    "doubtless sold thousands of bags of popcorn across the English-speaking tech world"

    Really? Even the financial papers have stopped caring.

    1. Teiwaz Silver badge

      popcorn???

      "doubtless sold thousands of bags of popcorn across the English-speaking tech world"

      Yeah popcorn? Maybe a very small punnet.

      Really, I think only the 'stakeholders' (or more probably steakholders - something more tasty to nom on, and perhaps a bloody one something to throw to the baying of the lawyer hounds).

      Most I cold manage is a small box of chocolate raisins with the highlights.

      1. teknopaul Silver badge

        Re: popcorn???

        I'm lovin it. Nothing like reading about overpaid execs spanking billions. It probably easy to justify the cost of autonomy if you measure it in CEO wages.

        Autonomy cost about 1000 crap CEOs,

        ~100 good CEOs.

        When you buy a company the important thing is what it is worth to you, not what it is worth to the current owners.

  2. Duncan Macdonald Silver badge
    Mushroom

    So far - what

    To judge by the reports so far HPE has not proven anything (except that HPE had idiotic management). Unless Lynch & co do something stupid in court, HPE will lose this legal battle.

    The only reason that HPE is in this legal battle is to try to save face for their management - even if they won, the actual amount of money they could get from Lynch would not come close to meeting their legal bills. By the time that HPE loses and has to pay its and Lynch's legal bills, millions of HPE's money will have been squandered - and a lot of lawyers will be laughing all the way to the bank.

    One could make a reasonable case against HPE management for wasting shareholders assets on an unwinnable case.

    Icon for what should happen to HPE senior management ====================>

    1. Pascal Monett Silver badge

      Re: millions of HPE's money will have been squandered

      It's okay, they've already squandered billions. A few millions more is not a financial problem.

      Besides, it's HP(E). They're used to squandering money.

      1. Benson's Cycle

        Re: millions of HPE's money will have been squandered

        Back in the day when oi were nobbut junior engineer and had to touch my forelock to the cleaning lady, our engineering director remarked that it was always worth going with roulette odds if you could afford it.

        But what he meant by roulette odds was if you had a 50:50 chance of a project succeeding, but the returns were many times greater than the cost. If you could bet on a number at roulette at the usual 36:1 return, but with a 50% chance of its coming up, you would be stupid not to.

        Same here:

        Potential return $5 billion.

        Legal costs won't exceed $100 million

        Chance of succeeding in a civil court? As I once heard my father say down the phone to a client "Of course you can go for Counsel's opinion and pay £30 000 to be told you've got an evens chance of winning. Or you can take me out to lunch and I'll tell you for a lot less."

        If it was easy, HPE wouldn't need to write a book of claims in the hope that a few stick.

        The HPE strategy makes perfect sense, as did the Apple strategy against Samsung.

        1. I ain't Spartacus Gold badge

          Re: millions of HPE's money will have been squandered

          Potential return $5 billion.

          The only problem is that Lynch and Co don't have $5bn.

          I'm sure they can squeeze hundreds of millions out of them, if they win. But I'd be surprised if they can manage much more than that. Still a profit on the trial I suppose. Though even in the (unlikely looking to me) event they win, the PR damage of some of their own testimony has been pretty high.

      2. Anonymous Coward
        Anonymous Coward

        Re: millions of HPE's money will have been squandered

        Besides, it's HP(E). They're used to squandering money.

        It's what the term "business as usual" was invented for..

    2. Captain Scarlet Silver badge
      Unhappy

      Re: So far - what

      "Icon for what should happen to HPE senior management"

      Nope, they would have probably left for personal reasons with big bonus' and pensions before the blame is pinned on them.

      (Btw this does annoy me and is not right)

    3. aks Bronze badge

      Re: So far - what

      HPE's original strategy seems to be to get an easy win on balance of probabilities in the UK courts to use as ammunition for criminal charges in the USA. They knew they couldn't win a criminal case in the UK where you have to have to prove your case beyond reasonable doubt.

    4. Mark 85 Silver badge

      Re: So far - what

      To judge by the reports so far HPE has not proven anything (except that HPE had idiotic management).

      No matter how this turns out, that will be the final result: HP (HPE) has idiot manglement and is dying a slow death.

      1. Trollslayer Silver badge

        Re: So far - what

        Like IBM, trying to succeed as an outsourcer and failing.

        What was it?? Losses in 22 consecutive quarters?

  3. fnusnu

    That slobbering sound I can hear...

    Is that lawyers licking their lips at the thought of the fees they are going to bill?

    1. Kubla Cant Silver badge
      Thumb Up

      Re: That slobbering sound I can hear...

      The picture at the top of the article shows The Royal Courts of Justice - The Rolls Building. I can't help thinking that the name of the building refers to the cars the lawyers' expect to buy.

      1. macjules Silver badge

        Re: That slobbering sound I can hear...

        I think it was more along the lines of "Rolls in, rolls in, my God, how the money rolls in".

  4. macjules Silver badge

    Dead Parrot?

    ... repeated most if not all of those false and misleading statements directly to Bidco, Hewlett-Packard's acquisition vehicle, as a result of which Bidco, we say, paid very much more for Autonomy

    Bidco: " 'Ello, I wish to register a complaint."

    Bidco: "'Ello, Miss?"

    Autonomy: "What do you mean "miss"?"

    Bidco: "'I'm sorry, I have a cold. I wish to make a complaint!"

    Autonomy: "We're closin' for lunch."

    Bidco: "Never mind that, my lad. I wish to complain about this company what I purchased not half an hour ago from this very boutique."

    1. GrapeBunch Silver badge

      Re: Dead Parrot?

      This article is the first reference I've noticed to the mysterious Bidco. Maybe HPE should be suing Bidco, not the rump of Autonomy, except that HPE's contract with Bidco probably excludes that, and Bidco probably doesn't have assets. Or "enough" assets.

      Inspired by the semi-existence of Bidco, I suggest adapting the "Eric The Half-A-Bee" skit.

    2. BebopWeBop Silver badge

      Re: Dead Parrot?

      That's Norwegian software houses for you.

    3. Ken Shabby Bronze badge
      Trollface

      Re: Dead Parrot?

      Autonomy: "Look, if you go to my brother's shop in Bolton, he'll replace the company for you."

    4. GloriousVictoryForThePeople

      Re: Dead Parrot?

      I was thinking more Grytpype-Thynne and Moriarty singing

      "Springtime in Paris -

      here comes a Charlie"

  5. Doctor Syntax Silver badge

    "HPE's detailed claims run to 894 pages in their written opening alone."

    Remind me again how many pages of due diligence report they went through in detail before deciding to buy.

    1. skwdenyer

      Presumably prolix will be added to exegesis in m’lud’s pronouncements at some point?

      1. Muscleguy Silver badge

        Well M'Lud will want to get his own back at the QC's for wasting his time so they will have to wade through screeds and scratch their heads hard to figure out if their clients have won anything.

    2. Anonymous Coward
      Anonymous Coward

      None.

      They were too busy wining and dining each other, and thinking of their snouts in the trough they thought was just around the corner.

  6. Anonymous Coward
    Anonymous Coward

    "with judgment due at some point before May that year."

    whereupon it will be immediately appealed by the losing party. Subsequent verdicts from the appeals will take place in 2022, 2024, 2026, 2028 etc...

    1. Aqua Marina

      In UK civil cases, appeals can only be made on a point of law or a failure of procedure. They can’t just go through the whole trial again because someone thinks the judge made the wrong decision. The judgement in a civil case is usually final.

  7. Andy Mac

    In this part of the world we’re basking in the winter sun. Just sayin’...

    1. Anonymous South African Coward Silver badge

      An yes' 'ere we're baskin inna luvrly spring sun dis 'ere part of de world.

  8. BebopWeBop Silver badge

    A lawyer acquaintance of mine mentioned that he knew people in London who were planning their pension plans on this case.

  9. msage

    Due Diligence

    OK, I might be being thick here, but....

    1. Surely HPE did some due dil that's why they employed Deloitte to do it.

    2. If HPE should be suing anyone it should be Deloitte, who if found to be guilty should...

    3. Deloitte should be suing Autonomy for hiding stuff when it did the due dil.

    I really don't understand how HPE can think they can win, they *paid* a 3rd party and then went with their recommendation, surely deloitte should be the ones on trial here. Either Deloitte didn't get the information in which case they should have recommended that HPE walk away or buy for less. Deloitte did get the information and didn't pass it on to HPE, therefore, they are the guilty party or, lastly, Autonomy lied to Deloitte and therefore Deloitte didn't have the information and would have made an inaccurate recommendation to HPE.

    TLDR; how come HPE are suing Autonomy (i.e. Lynch) rather than Deloitte...

    1. Alan Johnson

      Re: Due Diligence

      Actually HP bought Autonomy before Deloitte had finished the due diligence. That means Deloitte are totally off the hook.

      The rest of it is just barelling scrapping nonsense. Naturally in a company thsi size they can find some dodgy deals/crooked salesman but even if everything HP says is taken a true then they have nothing that adds up to anything like billions of overvaluation.

      HP opened their case with the fact that Autonomy was selling some hardware. This should have been obvious to anyone that knew the market as they would have to do so to facilitate their software sales and once selling hardware the sales force would inevitably use it to sweeten or enhance deals. The hardware sales were always small compared to the software. It would have been identified as part of due dilligence - but - oops this was never completed. That they even bothered raising this let alone opened with it tells a lot.

  10. fredesmite Bronze badge
    Mushroom

    Buyers at HPE were a bunch of Trump Univ grads?

    No one did a real investigation?

    Suckers.

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