High Court decision in first s.90A FSMA claim to reach trial

The High Court has published a summary of its findings on liability in the long-running USD$5 billion civil fraud action brought by the Hewlett Packard group in connection with its acquisition of the UK software company Autonomy Corporation Limited in 2012. The claimants have “substantially succeeded” in their claims against two former Autonomy executives: ACL Netherlands BV, Hewlett Packard The Hague BV and others v Lynch and Shushovan [HC-2015-001324].

Mr Justice Hildyard in the Chancery Division outlined his findings in a detailed Summary of Conclusions, in advance of his full judgment which is currently embargoed. The successful claims were brought under s.90A of the Financial Services and Markets Act 2000 (FSMA), common law misrepresentation and deceit, and the Misrepresentation Act 1967, as well as claims for breach of the defendants’ management duties.

The findings are limited to the issue of liability, with a separate judgment on the quantum of damages to be delivered at a later date. The court indicated that although "substantial", damages are anticipated to be "considerably less than claimed”.

This decision represents a significant development, as the first claim brought under s.90A FSMA to be considered at full trial. However, the s.90A FSMA claim was brought in the very different context of a post-closing M&A dispute, rather than the more classic securities class action brought on behalf of a large group of institutional investors. That said, there may be some helpful guidance on key elements of s.90A when the full decision becomes available, which we will consider in due course when it becomes public.

For more information see this post on our Civil Fraud and Asset Tracing Notes blog.