Claimants “substantially succeed” in the largest ever English civil fraud 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 (“Autonomy”) 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 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. However, the judge did indicate that he anticipated that “although substantial, it will be considerably less than claimed”.

The court observed that the litigation had been “an exceptionally onerous case” for everyone involved. The “unusually complex” trial lasted 93 days, including cross-examination of the first defendant, Dr Lynch, for 20 days (Mr Hussain did not attend as he is incarcerated in the US). There was a database of “many millions” of documents, reduced to a trial bundle of more than 28,000 documents. In addition, there were hundreds of pages of hearsay evidence, largely comprised of transcripts from previous civil and criminal proceedings in the US. The full judgment (on liability alone) is expected to run to at least 1500 pages.

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