Tech Tycoon Mike Lynch Cleared of Fraud Charges in US Trial

In a stunning victory, British tech tycoon Mike Lynch has been cleared of fraud charges in a US trial. The jury in San Francisco found him not guilty on all counts, bringing an end to a 13-year ordeal that has seen him accused of inflating the value of his software firm, Autonomy, ahead of its sale to Hewlett-Packard (HP) in 2011.

A British tech tycoon has been cleared of fraud charges in a US trial

Lynch, who faced more than 20 years in prison if convicted, had denied the charges, taking the stand to defend himself. In his testimony, he maintained that he had focused on technology, not accounting, distancing himself from other executives, including the company’s former chief financial officer, who was already successfully prosecuted for fraud.

“I am elated with today’s verdict and grateful to the jury for their attention to the facts over the last 10 weeks,” he said in a statement.

A Pioneer in Tech

Lynch co-founded Autonomy in 1996 and led it as it grew to be one of the UK’s biggest companies, winning him comparisons to Bill Gates and Steve Jobs. The company, known for software that could extract useful information from “unstructured” sources such as phone calls, emails, or video, was ultimately sold to HP in 2011 in a deal that ranked, at the time, as the largest-ever takeover of a British technology business. Lynch made £500m from the sale.

Autonomy’s software could extract useful information from unstructured sources

The Aftermath

Just a year later, HP wrote down the value of Autonomy by $8.8bn. Years of legal battles followed, with the company’s chief financial officer, Sushovan Hussain, being found guilty of fraud in 2018 and later sentenced to five years in prison.

US prosecutors brought charges against Lynch in 2018, accusing him of inflating the value of the firm using backdated agreements to mislead about the company’s sales; concealing the firm’s loss-making business reselling hardware; and intimidating or paying off people who raised concerns.

Lynch was accused of inflating the value of Autonomy

A Victory for Lynch

The verdict is a stunning victory for Lynch, who had faced house arrest in the US while preparing for the trial, which began in San Francisco in March. Prosecutors had called dozens of witnesses to the stand, including the former head of HP Leo Apotheker, who was fired shortly after the purchase was announced.

But the arguments fell flat. Lynch’s team pushed the argument that HP had failed to properly vet the deal and mismanaged the takeover, while he testified he was uninvolved with the transactions being described.

Judge Charles Breyer had already dismissed one count of securities fraud during the trial for lack of evidence.

Lynch’s team argued that HP had failed to properly vet the deal

A New Chapter

As Lynch returns to the UK, he can finally put the ordeal behind him. “I am looking forward to returning to the UK and getting back to what I love most: my family and innovating in my field,” he said in a statement.

The verdict closes the book on a relentless 13-year effort to pin HP’s well-documented ineptitude on Dr. Lynch. Thankfully, the truth has finally prevailed.

Lynch can finally put the ordeal behind him