(The Telegraph) - Hewlett Packard (HP) is seeking £1.5bn from the estate of the late British tech tycoon Mike Lynch in a claim likely to wipe out his fortune.
The Silicon Valley company has argued it is owed the sum after winning a long-running fraud case over its purchase of Lynch’s tech company Autonomy in 2011.
The claim, made in legal filings on Tuesday, is substantially more than the £740m in damages that a judge said HP had suffered as a result of Lynch inflating Autonomy’s value.
If successful, it would dwarf the size of Lynch’s fortune, which has been estimated at around £500m, and would bankrupt his estate.
While the Lynch estate would face being wiped out by an adverse ruling, many of the family’s assets are held in his wife’s, Angela Bacares, name. These would not be affected by any potential ruling.
Lynch, once described as “Britain’s Bill Gates”, sold Autonomy to Hewlett Packard for £7bn in 2011. The deal made him hundreds of millions but soon turned sour with HP accusing him of fraud.
HP sued Lynch at the High Court in 2015 and he was found liable for fraud in 2022.
Lynch was cleared of US criminal charges last year over the deal, but he and his teenage daughter Hannah were among seven who died while celebrating his freedom on his Bayesian superyacht shortly after the trial concluded.
His estate is now battling HP over damages owed to the US company and is seeking permission to appeal the fraud ruling.
Mr Justice Hildyard said in July that HP had suffered damages of around £740m as a result of Lynch and former Autonomy finance chief Sushovan Hussain inflating the company’s value with a series of accounting tricks.
A final award is due to be determined based on interest due to HP since the deal was completed, as well as legal costs and foreign exchange conversions.
HP claims that it is owed more than $760m (£578m) in interest, as well as almost £120m in legal fees.
Lynch’s estate, which is being managed by Jeremy Sandelson, a Clifford Chance lawyer, is disputing the company’s figures.
The trial that led to the judgment was one of the longest in English legal history. Mr Hussain settled with HP separately for £78m earlier this year.
Lynch’s estate has sought permission to challenge both the estimation of the damages and the finding that the vehicle HP used to acquire Autonomy was deceived.
A spokesman for the Lynch family said: “Today’s hearing addresses technical matters that change nothing about the underlying substance of the case. The core facts remain that HP’s claim was fundamentally flawed and a wild overstatement.
“By any account, including the court’s, HP’s own mismanagement destroyed the vast majority of Autonomy’s value. Dr Lynch’s acquittal in the US criminal trial exposed the truth when witnesses were properly cross-examined.”
HP said: “We are pleased that this hearing brings us a step closer to the resolution of this dispute.”
By James Titcomb - Technology Editor
