Fraud trial witnesses refuse to attend
Americans asked to give evidence on behalf of tech giant say they are ‘too busy’ for Autonomy court case
HP’S £4bn fraud case against Autonomy founder Dr Mike Lynch is facing growing problems after it emerged two important witnesses from the US are refusing to attend the High Court in London to give evidence this month.
The US technology giant wrote down the majority of the value of Autonomy in 2012, less than a year after it had acquired the UK software company in a disastrous £8.4bn deal.
The botched acquisition is now the focus of Britain’s biggest ever civil fraud trial, a £4bn dispute between HP and Autonomy’s founder, Dr Mike Lynch, who has been accused of inflating the company’s accounts. Dr Lynch denies the allegations.
Lawyers for HP are facing last-minute difficulty preparing their case against Dr Lynch as two of its witnesses from the US scrapped plans to attend the High Court this month. The trial, which began last week, is expected to last nine months.
Former Autonomy salesman Jim Krakoski has pulled out of testifying next week, informing HP’S lawyers via email on Wednesday of his decision.
Another witness for HP, John Meiers who worked in procurement for US tax accountancy firm H&R Block, has also told HP’S lawyers that he will no longer fly to London to give evidence.
Laurence Rabinowitz QC, represent- ing HP, told the High Court that both men are citing busy work schedules as the reason for being unable to travel to London.
Mr Justice Hildyard called the disruption to the case “terribly discombobulating” on Thursday.
HP has accused Autonomy of engaging in reciprocal transactions, buying goods and services from its own customers in return for continued relationships with them. It has also claimed that Autonomy hid the size of its hardware sales business.
Mr Rabinowitz told the High Court on Thursday that HP’S lawyers were struggling to contact their witnesses in the US. “Not all of these people are very communicative when they know what we’re asking them to do … we don’t always get a response from them,” he said. “We can’t force them here,” the barrister said of HP’S US witnesses.
Lawyers for HP are now considering whether to allow witnesses to give evidence via video link, despite “a fair amount of hostility” towards the practice, Mr Rabinowitz said.
HP has also accused Dr Lynch of failing to write his own witnesses statement. Mr Rabinowitz called it an “astonishing document” in the High Court on Thursday.
“Your Lordship really will want to ask yourself how that could conceivably have been his own language,” the barrister said. He added that Dr Lynch’s witness statement includes references to transcripts and hearings. “It plainly was not put together in accordance with the rules,” Mr Rabinowitz claimed.
Earlier this week, the High Court heard the testimony of Léo Apotheker, the former HP chief executive, who was fired shortly after the Autonomy deal was completed.
Mr Apotheker admitted on Monday that he had failed to read Autonomy’s two most recent earnings reports before purchasing the business, but denied that he was “grossly negligent”.
“I ran a $125bn company,” Mr Apotheker said, “minutes are pretty precious”.
The trial continues.