HP hit with civil securities lawsuit over Autonomy
updated 03:19 pm EST, Mon November 26, 2012
Investor claims HP misled stockholders
An investor has filed a civil securities lawsuit against Hewlett-Packard, alleging that the computer giant misled stockholders with regard to its purchase of Autonomy. HP bought Autonomy last year, but just last week the company announced it would be taking an $8.8 billion write-down on the purchase, citing misleading statements and other improprieties in Autonomy's financials. Reuters reports that the civil suit is a class action lawsuit, and it was filed in a San Francisco court today. It is not yet confirmed, but the suit may name HP CEO Meg Whitman and former CEO Leo Apotheker as defendants.
The suit is likely just the first in what promises to be a good deal of fallout surrounding the $8.8 billion write-down and subsequent accusations.
HP announced the write-down at the same time it reported its earnings for the fourth quarter. The computer and printer maker lost $6.9 billion on $30 billion in revenue.
The Autonomy acquisition was carried out under now-former HP CEO Leo Apotheker, but it had support from current HP CEO Meg Whitman. HP paid a 58 percent premium above Autonomy's share price at the time of the purchase.
In announcing the write-down, HP said there appeared to "have been a willful effort on behalf of certain former Autonomy employees to inflate the underlying financial metrics" of the company. HP's statements went on to accuse unnamed Autonomy employees of intentional distortion of Autonomy's earnings.
Mike Lynch, former CEO of Autonomy, fired back late last week, strongly denying HP's allegations and attributing any perceived improprieties to the differences in accounting standards between American and international firms.
