HP Eyeing Autonomy Shareholder Lawsuit Settlements

Hewlett-Packard Friday confirmed that it is in serious discussions to settle shareholder lawsuits related to its $11.1 billion acquisition three years ago of software maker Autonomy.

HP purchased the software company, which specialized in unstructured data solutions, in October 2011 and then a year later took an $8.8 billion charge against earnings after discovering what it called "serious accounting improprieties" by Autonomy.

The Autonomy purchase sparked a number of lawsuits, including a $1 billion lawsuit accusing HP of vastly overvaluing Autonomy as a result of alleged "cursory due diligence on a polluted and vastly overvalued asset."

[Related: HP's Autonomy Mishap: From High Expectations To High Anxiety ]

Reuters reported Friday that HP and attorneys representing shareholders have agreed to settle the litigation with an announcement coming as soon as Monday.

HP, for its part, confirmed that it is in "serious discussions to settle the shareholder derivative litigation related to Autonomy, but no final deal has been reached yet."

Reuters reported that as part of the agreement, the attorneys representing shareholders will assist HP in pursuing claims against Autonomy Co-Founder and CEO Michael Lynch and other Autonomy executives.

Lynch, for his part, has vehemently denied any accounting improprieties in what has become a long-running vitriolic battle with HP.

HP Autonomy partners said the legal drama has had no impact on their ability to drive big sales gains with a breakthrough product that has only gotten more feature-rich under HP.

Alphaworks, an HP Autonomy partner based in Plano, Texas, for example, expects its Autonomy sales and services revenue to increase a whopping 200 percent this year and even greater sales growth in 2015, said Alphaworks Executive Vice President and Director Johnny Joe.

The lawsuits and controversy surrounding HP’s acquisition of Autonomy are much ado about nothing, said Joe. He said he expects Autonomy to eventually be worth much more than the $10.3 billion HP paid for the company.

"It's unbelievable how much progress HP has made adding new functionality and features to Autonomy and integrating it into many HP products," said Joe. "HP is investing heavily in innovation, and HP Autonomy is a great example of that. The Autonomy Idol platform is in everything from HP printers to storage to networking and other HP software."

Joe said the market has moved well beyond the provincial lawsuits surrounding the Autonomy acquisition. "We don't hear about this in the field,’ he said. ’We didn't see this slowing anything down."

PUBLISHED JUNE 27, 2014