San Francisco, California –

Federal prosecutors on Monday named former British tech star Mike Lynch as the ruthless mastermind of an $11 billion deal that defrauded Silicon Valley pioneer Hewlett Packard.

But his lawyer portrayed him as a visionary who was made a scapegoat for a desperate buyer’s bad decision.

The contrasting portraits of the 58-year-old Lynch were created at the start of a criminal case surrounding HP’s 2011 takeover of British software maker Autonomy – a deal that was initially hailed as a coup but then turned into a costly debacle.

Lynch, once hailed as an example of British ingenuity, faces 16 counts of fraud and conspiracy and faces more than 20 years in prison if a jury convicts him on all counts. The trial in federal court in San Francisco is expected to last two to three months.

Although the trial focuses primarily on Lynch’s 16-year reign, which culminated in his firing by then-HP CEO Meg Whitman in 2012 just nine months after the takeover, the trial will also shine a spotlight on the decline and chaos of a storied company in the Throw Silicon Valley.

Whitman’s predecessor, Leo Apotheker, bought Autonomy as part of a plan to reduce HP’s reliance on sales of PCs and printers amid the disruption caused by the rise of the smartphone. But after the deal spiraled into a financial scandal, Whitman laid off thousands of workers as HP’s fortunes dwindled, ultimately leading to the company’s split in two in 2015.

Lynch’s attorney Reid Weingarten emphasized that HP’s deteriorating situation in 2011 was the main reason the company wanted to complete the Autonomy acquisition without conducting a thorough review of the company. The situation was so bad, Weingarten told the jury, that Apotheker compared HP to a “burning platform” in the ocean. Meanwhile, Whitman praised Autonomy’s products as “magic software,” he said.

“HP was in desperate shape, so they had to do something,” Weingarten told the jury during his hour-long opening statement.

In his 80-minute opening statement, federal prosecutor Adam Reeves alleged that Lynch began lying to HP executives as soon as contract negotiations began, at a meeting in early 2011 at HP’s headquarters in Palo Alto, California – the same city in which Bill Hewlett and Dave Packard founded the company in 1939.

“It was the scene of one [US]$11 billion fraud,” Reeves said of the first meeting between Lynch and HP executives. Although Lynch made it seem like he was running a “money machine,” Reeves said, “Autonomy’s success was actually an elaborate, multi-layered, multi-year scam.”

Reeves said the prosecution will present witnesses who will explain how Autonomy manipulated its balance sheets and engineered a series of deals to illegally increase its revenue over a two-and-a-half-year period, thereby deceiving HP for an acquisition to pay that you would regret later. And Lynch directed the gravediggers, according to Reeves.

“He was a domineering, controlling boss,” Reeves told the jury. “For many years he ran Autonomy with an iron fist.”

Although he acknowledged that Lynch was a “tough fighter” who demanded the best from his employees, Weingarten said Lynch delegated most accounting and marketing matters while focusing primarily on innovation.

“Mike was ahead of everyone for a long time,” Weingarten said. “He’s a startup guy who liked to eat cold pizza at 2 a.m. and invent things along the way.”

Weingarten also showed the jury an internal HP document created in July 2011 – a month before the acquisition was announced – that valued Autonomy at $46 billion. This suggested that the valuation showed that HP thought it was getting a bargain to acquire the rights to software that helps companies find information hidden in emails and Word documents.

“Autonomy’s software was so powerful that there was no competitor close to it, and it sold like hotcakes,” Weingarten said.

Lynch, who has been free on $100 million bail since being extradited to the U.S. last May, sat stoically through most of the opening statements while watching and occasionally watching presentations that appeared on a display took a look at the lawyers and the jury.

The jury will eventually hear from Lynch, who Weingarten has promised will testify to tell his side of the story.

“We want you to know him, we think that helps us,” Weingarten said.

The testimony will likely open the door for prosecutors to learn more about Lynch’s motivations for the deal that netted him more than $800 million, according to court documents.

Apotheker, who replaced Whitman a few weeks after the Autonomy deal was announced, is also expected to testify. Whitman, currently the U.S. ambassador to Kenya, is not expected to appear in court during the trial, although her management of HP and the Autonomy takeover is expected to come under scrutiny.

Lynch’s trial also involves fraud allegations against Stephen Chamberlain, Autonomy’s former vice president of finance.

Sushovan Hussain, Autonomy’s former chief financial officer and Lynch’s former officemate, was sentenced to five years in prison in 2019 after being convicted of 16 counts of fraud and conspiracy. Although Hussain’s name was mentioned in Monday’s opening statements, there was no mention of his conviction.

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