Hewlett-Packard (HP) says they will continue seeking $4 billion in damages from late billionaire Mike Lynch’s estate.
Lynch was one of seven people who died after his yacht, the Bayesian, sunk off the coast of Sicily on August 19.
Mike Lynch was a well-known British entrepreneur and the founder of Autonomy Corporation, a software company that he sold to Hewlett-Packard in 2011 for $11 billion.
The acquisition, however, soon became a source of major contention. HP later accused Lynch of fraud, alleging that he had misrepresented Automony’s revenue prior to the sale. Consequently, Hewlett Packard says they overpaid for the acquisition based on falsified records, culminating in $8.8 billion in losses.
A 12-Year Legal Saga
HP filed a lawsuit against Lynch in 2015, seeking damages for what it described as a deliberate scheme to deceive the company. Lynch, who consistently denied the allegations, became embroiled in a lengthy legal battle with the tech giant.
Lynch avoided trial for 12 years before losing an extradition appeal, returning to the U.S. in May. However, in June, he acquitted on the 15 felony criminal fraud charges in a U.S. court. Lynch was reportedly celebrating the legal victory with the Sicilian trip that ultimately led to his death.
But Lynch was not home free from the Hewlett Packard fraud case. HP had also pursued a civil case in a U.K. court. In 2022, a judge ruled that HP had “substantially won” its case against Lynch. However, the amount of damages for the settlement is pending. Though HP sought $5 billion from the billionaire prior to his death, U.K. Judge Hildyard cautioned HP that the damages from the suit would likely be less.
The circumstances surrounding the sinking yacht remain under investigation, Lynch’s death has added a new layer of complexity to the already tangled legal situation. It quickly became clear that Lynch’s death would not bring an end to the legal battles that had defined his later years.
Hewlett-Packard’s Pursuit of Damages from Mike Lynch’s Estate
Despite Lynch’s death, an HP spokesperson says the company intends to continue its pursuit of damages from Mike Lynch’s estate.
“In 2022, an English High Court judge ruled that HPE had substantially succeeded in its civil fraud claims against Dr Lynch and Mr Hussain. A damages hearing was held in February 2024 and the judge’s decision regarding damages due to HPE will arrive in due course. It is HPE’s intention to follow the proceedings through to their conclusion,” they said in a statement.
HP’s actions are not unprecedented. In many cases, legal claims against an individual do not automatically end upon their death. Instead, the responsibility for resolving such claims typically falls to the deceased person’s estate.
The case against Mike Lynch’s estate is expected to be a protracted and complex legal battle. The estate, now managed by Lynch’s executors, will likely continue to contest HP’s claims, arguing that Lynch was not guilty of the fraud allegations and that the company’s financial losses were due to its own mismanagement.
For HP, the stakes are high. Recovering the $4 billion it seeks would represent a significant financial victory for the company and a vindication of its claims against Lynch after a 12-year long legal battle. However, the company must also navigate the potential reputational risks associated with pursuing legal action against a deceased individual’s estate.
