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> But Dr Lynch has argued that HP used the allegations to cover up its own mismanagement of Autonomy after the 2011 deal. I have no comment to make on Mike Lyn

> But Dr Lynch has argued that HP used the allegations to cover up its own mismanagement of Autonomy after the 2011 deal. I have no comment to make on Mike Lynch's guilt or innocence in this matter, because I simply don't know enough about him or about Autonomy (despite working in an office just across the road for 3 years leading up to the sale)[0], but tough to argue that HP wasn't mismanaged during this period, and therefore tough to assert that this mismanagement wouldn't have extended to Autonomy. Could this have made HP easier to dupe, or did they not get duped and just do a bad job? It's going to be weird if the outcomes of the civil and criminal cases end up disagreeing on this point. And I think whatever the outcome, it reflects badly on HP: if he's not guilty then it adds weight to his assertion about mismanagement, and if he is guilty then it means they were duped during DD (and may in addition have mismanaged Autonomy). Neither of these is a good look. [0] I do know a handful of people who have worked with and for Mike Lynch: some of them really rated him, some really don't. It's about what you'd expect for a prominent business executive. As I say, I have no basis on which to form any kind of opinion of him.

JumpCrisscross 5y ago
> tough to argue that HP wasn't mismanaged during this period, and therefore tough to assert that this mismanagement wouldn't have extended to Autonomy How is this relevant? If you get sold a computer, are delivered a turtle, and then kill it because you forgot to feed it, it can simultaneously be true that you were (a) incompetent and (b) defrauded.
- bartread 5y ago
  It's relevant to HP and their shareholders, and it's relevant because there is an ongoing civil case in the UK, which makes this situation on criminal charges in the US more interesting and unusual, and finally it's foundational to Mike Lynch's argument with HP[0]. It's entirely possible that we might see different outcomes in these cases. Maybe a difference in outcome between civil and criminal cases is a more common occurrence than I'm aware of (certainly O. J. Simpson springs to mind), but it seems unusual to me, and especially across international boundaries. [0] Again, I haven't followed these goings on that carefully, but my impression is he's hewn pretty closely to this line of argument throughout.
- zerocrates 5y ago
  I also have no real knowledge about the situation, but it's also plausible for the two to be related: that is, you were easy to defraud because of your incompetence. Which of course doesn't make the perpetrator any less culpable.
- laumars 5y ago
  It’s relevant because that’s his defence. As cited in the article we are discussing.
- lumost 5y ago
  In the context of DD, it's possible that these items were disclosed to HP and HP simply didn't care/think through what was going on. If the actions weren't criminal, but instead the result of a CEO/company not using accounting best practices/pushing too aggressively then HP may not have a civil or criminal case. The time that Microsoft failed to acquire Skype's IP comes to mind.
  - DaiPlusPlus 5y ago
    > The time that Microsoft failed to acquire Skype's IP comes to mind. Huh, TIL! I had no idea about that: https://www.iam-media.com/article/648B260AFA518A71125F0E77C38F3E53D783BC2F/download https://www.iam-media.com/article/648B260AFA518A71125F0E77C3... That said, I don't believe that was why Skype lost relevance after Microsoft bought them: Microsoft was seemingly intent on compromising the Skype UX to promote the then-named Windows Live service - and they didn't combat the problems with spam on the service - and the ill-advised and ultimately reversed decision to force-convert Skype accounts into Windows Live accounts in a hamfisted way that left me personally with 3 duplicated accounts and no easy way of managing them - especially after they decreed that Skype will only support 1 account per Windows account in their flagship Windows 8-exclusive client and remove secondary instances from the legacy client, and the list goes on... ...I'd summarise it as them alienating their own fanbase and the tech-thought-leader community, which led to them (us?) seeking different platforms like WhatsApp, Telegram, Facebook Messenger and Skype quickly becoming irrelevant. When they relaunched Skype's new desktop client as an Electron app I knew they had stopped caring about it - because they immediately lost all of the advantages of having platform-specific clients, which is especially useful for video-conferencing due to the limitations imposed by Chromium (which are far better now than they were, but still...)
    - Closi 5y ago
      Unpopular opinion: The Skype brand was critical to getting decent uptake in Lync (rebranded as Skype For Business) and these users were migrated across to Microsoft Teams which has been overwhelmingly popular (at least in the UK it’s the de-facto conference app). It’s not totally clear to me that Microsoft would actually be doing well in the space without the Skype aquisition, but considering they bought Skype for 8.5bn and Zoom now has a market cap of 100bn my assumption is that Teams is valuable and maybe the price was worth paying.
- arthurcolle 5y ago
  This is a hilarious example. I hope I get delivered a turtle by accident some day.
- DubiousPusher 5y ago
  Because nothing is that black and white. As regards the civil case you must be able to show harm. If I sell you a house with a foundation that is only built to last 10 years and then you burn the house down, you can't sure me for damages so long as the crummy foundation had nothing to do with the house burning down. To win damages you must be able to show harm. So the entire civil case hinges on the root of the poor performance of the company after purchase. On the criminal side it's all going to hinge on whether the accounting practices rise to the level of fraud. That's trickier to nail down than you may think because a certain amount of liberty is often taken in trying to project growth, future earnings, etc. HP is likely going to present the subsidiary's poor performance as evidence that the accounting did rise above the level of normal wiggle room. The defense will surely attack that argument. But as long as HP had access to enough of the company's finincial documents to identify the accounting practices in question it will be hard to prove out and out fraud. Edit: ENRON is a good example because as clear cut as people believe that fraud was, it wasn't so obvious at the time. Writing down future contracts as earnings wasn't unheard of. They just followed that logic to an unsustainable conclusion. Which in the end clearly was fraud but it took hundreds of small steps and it's hard to say exactly when it did become fraud.

JumpCrisscross 5y ago

> tough to argue that HP wasn't mismanaged during this period, and therefore tough to assert that this mismanagement wouldn't have extended to Autonomy How is this relevant? If you get sold a computer, are delivered a turtle, and then kill it because you forgot to feed it, it can simultaneously be true that you were (a) incompetent and (b) defrauded.

bartread 5y ago
It's relevant to HP and their shareholders, and it's relevant because there is an ongoing civil case in the UK, which makes this situation on criminal charges in the US more interesting and unusual, and finally it's foundational to Mike Lynch's argument with HP[0]. It's entirely possible that we might see different outcomes in these cases. Maybe a difference in outcome between civil and criminal cases is a more common occurrence than I'm aware of (certainly O. J. Simpson springs to mind), but it seems unusual to me, and especially across international boundaries. [0] Again, I haven't followed these goings on that carefully, but my impression is he's hewn pretty closely to this line of argument throughout.
zerocrates 5y ago
I also have no real knowledge about the situation, but it's also plausible for the two to be related: that is, you were easy to defraud because of your incompetence. Which of course doesn't make the perpetrator any less culpable.
laumars 5y ago
It’s relevant because that’s his defence. As cited in the article we are discussing.
lumost 5y ago
In the context of DD, it's possible that these items were disclosed to HP and HP simply didn't care/think through what was going on. If the actions weren't criminal, but instead the result of a CEO/company not using accounting best practices/pushing too aggressively then HP may not have a civil or criminal case. The time that Microsoft failed to acquire Skype's IP comes to mind.
- DaiPlusPlus 5y ago
  > The time that Microsoft failed to acquire Skype's IP comes to mind. Huh, TIL! I had no idea about that: https://www.iam-media.com/article/648B260AFA518A71125F0E77C38F3E53D783BC2F/download https://www.iam-media.com/article/648B260AFA518A71125F0E77C3... That said, I don't believe that was why Skype lost relevance after Microsoft bought them: Microsoft was seemingly intent on compromising the Skype UX to promote the then-named Windows Live service - and they didn't combat the problems with spam on the service - and the ill-advised and ultimately reversed decision to force-convert Skype accounts into Windows Live accounts in a hamfisted way that left me personally with 3 duplicated accounts and no easy way of managing them - especially after they decreed that Skype will only support 1 account per Windows account in their flagship Windows 8-exclusive client and remove secondary instances from the legacy client, and the list goes on... ...I'd summarise it as them alienating their own fanbase and the tech-thought-leader community, which led to them (us?) seeking different platforms like WhatsApp, Telegram, Facebook Messenger and Skype quickly becoming irrelevant. When they relaunched Skype's new desktop client as an Electron app I knew they had stopped caring about it - because they immediately lost all of the advantages of having platform-specific clients, which is especially useful for video-conferencing due to the limitations imposed by Chromium (which are far better now than they were, but still...)
  - Closi 5y ago
    Unpopular opinion: The Skype brand was critical to getting decent uptake in Lync (rebranded as Skype For Business) and these users were migrated across to Microsoft Teams which has been overwhelmingly popular (at least in the UK it’s the de-facto conference app). It’s not totally clear to me that Microsoft would actually be doing well in the space without the Skype aquisition, but considering they bought Skype for 8.5bn and Zoom now has a market cap of 100bn my assumption is that Teams is valuable and maybe the price was worth paying.
arthurcolle 5y ago
This is a hilarious example. I hope I get delivered a turtle by accident some day.
DubiousPusher 5y ago
Because nothing is that black and white. As regards the civil case you must be able to show harm. If I sell you a house with a foundation that is only built to last 10 years and then you burn the house down, you can't sure me for damages so long as the crummy foundation had nothing to do with the house burning down. To win damages you must be able to show harm. So the entire civil case hinges on the root of the poor performance of the company after purchase. On the criminal side it's all going to hinge on whether the accounting practices rise to the level of fraud. That's trickier to nail down than you may think because a certain amount of liberty is often taken in trying to project growth, future earnings, etc. HP is likely going to present the subsidiary's poor performance as evidence that the accounting did rise above the level of normal wiggle room. The defense will surely attack that argument. But as long as HP had access to enough of the company's finincial documents to identify the accounting practices in question it will be hard to prove out and out fraud. Edit: ENRON is a good example because as clear cut as people believe that fraud was, it wasn't so obvious at the time. Writing down future contracts as earnings wasn't unheard of. They just followed that logic to an unsustainable conclusion. Which in the end clearly was fraud but it took hundreds of small steps and it's hard to say exactly when it did become fraud.