Shareholder Lawsuits To Be Settled By Hewlett-Packard

Shareholder Lawsuits To Be Settled By Hewlett-Packard

Hewlett-Packard announced recently that it will settle lawsuits filed in connection to the $11.1 billion acquisition of Autonomy. Controversy has hounded the acquisition of the software maker by HP in 2011.

The acquisition of the software maker led to lawsuits and investigations by the governments of the United States and the United Kingdom. This followed the discovery of evidence that some former Autonomy employees worked on the books of the company before it was acquired by HP.

A number of shareholders filed lawsuits against HP after it announced that an $8.8 billion charge in connection to the acquisition will be absorbed by the company using its earnings. The shareholders claimed that Hewlett-Packard released ambiguous statements about the finances of the enterprise software company.

Claims against former and current officers, advisors and directors of HP will be dropped under the terms of the settlement. The plaintiffs will also provide assistance to the company in bringing claims against the former CEO and CFO of Autonomy, Michael Lynch and Sushovan Hussain, respectively.

HP also revealed that changes in its procedures for appraising possible acquisitions and mergers will be changed. These changes were created with the assistance of the plaintiffs.

Lynch traded charges with HP on who was responsible for the disappointing performance of Autonomy. HP revealed that deceptive accounting aa well as the failure of Autonomy to disclose the situation led to the controversy. On the other hand, Lynch denied the charges of HP by setting up a website. He also indicated that Autonomy was mismanaged by HP after it was acquired.

The settlement will deal with two pending lawsuits at the California Superior Court for Santa Clara County and one at the US District Court for the Northern District of California. However, other lawsuits filed by other shareholders have yet to be settled by HP. The settlement made by Hewlett-Packard is still subject to approval by the court.

Posted by James Fried on Thursday July 03 2014, 2:06 PM EDT. Ref: CNET. Link. All trademarks acknowledged. Filed under Featured News, Finance. Comments and Trackbacks closed. Follow responses: RSS 2.0