Autonomy’s Mike Lynch loses battle towards extradition to the US on fraud fees

UK tech tycoon Mike Lynch is operating out of choices in his efforts to keep away from extradition to the US to face wire and securities fraud, conspiracy, and related fees in reference to the $11 billion sale in 2011 of his software program firm Autonomy to Hewlett-Packard.

In a ruling as we speak, the Excessive Court docket of England and Wales in London rejected his request to overturn the choice in January 2022 by Priti Patel – on the time the UK’s residence secretary – to approve his extradition to the US for trials.

Lynch for years has denied the accusations and stated by means of a spokesperson that he’ll decide his subsequent steps, which may embody an enchantment to the European Court docket of Human Rights (ECHR), which Brexit Britain continues to be signed as much as. He has argued that America’s push to extradite him from the UK to the US amounted to authorized overreach that threatened the UK’s sovereignty and its residents.

Nevertheless, the Excessive Court docket noticed it in another way, pulling down every of the arguments for enchantment Lynch put forth, together with his declare that the costs did not rise to the extent permitting for extradition, that it was barred due to how a lot time had handed, that there have been human rights grounds as a result of remedies Lynch would wish in jail for medical situations, and that the US wasn’t the correct place for the case.

He additionally stated the extradition request was an abuse of course of.

“We have now concluded that not one of the grounds of enchantment are controversial, and we subsequently refuse permission to enchantment,” the judges dominated.

Over the previous a number of years, Lynch and his attorneys have fought – and misplaced – efforts to maintain him from being despatched off to the US. In a listening to March, his legal professionals argued Lynch must be placed on trial within the UK, the place the nation’s Critical Fraud Workplace stated it was ready to prosecute him if he wasn’t extradited.

Nevertheless, American prosecutors argued towards it, noting a few of the alleged legal acts came about within the US and pointed to the hurt to HP – a Silicon Valley stalwart – and its buyers. The British justices agreed.

“The very fact is that the loss was felt by HP, or its shareholders the vast majority of whom have been based mostly within the US,” they wrote.

HP … acquired an asset for which it paid $11.7 billion however the worth of the asset had been vastly overstated and it was price billions lower than the acquisition value

“HP acquired the shares in Autonomy, utilizing an organization that HP wholly owned, and HP offered the funds for buying Autonomy. Put in another way, HP … acquired an asset for which it paid $11.7 billion however the worth of the asset had been vastly overstated and it was price billions lower than the acquisition value paid by HP. As such, the loss was primarily suffered within the US.”

The choice shuts off a lot of the remaining authorized avenues for Lynch. His spokesperson opined that the ECHR was an choice, however it appears unlikely that his argument would win out. Thomas Garner, companion and extradition lawyer at London regulation agency Fladgate, commented appeals to the ECHR – also called the Strasbourg Court docket – can solely be based mostly on slim human rights grounds.

Notably, a lot of Lynch’s argument to the Excessive Court docket was that the US wasn’t the correct discussion board for a trial reasonably than human rights issues. He may additionally ask the ECHR for an injunction to the extradition order, which Garner stated is uncommon.

“It does work often, however you might be ordinarily taking a look at instances the place the main focus is on bodily dangers to the particular person in custody or the place a person has severe medical situations that will lead to demise if the person have been eliminated,” he informed The Register.

He famous {that a} full software to the ECHR may take months or years earlier than a listening to is held if the court docket determined to listen to the case. Nevertheless, “an software for pressing interim measures could be determined rapidly. The appliance would solely forestall his elimination if he succeeded in securing interim measures,” Garner stated.

HP in 2011 – 4 years earlier than it break up in HP Inc and HPE – needed to construct up its software program enterprise, seeing enterprise IT tendencies shifting away from {hardware} gross sales. After greater than a 12 months of negotiations, it agreed to purchase Autonomy and its enterprise software program enterprise.

Nevertheless, quickly after the deal closed HP executives accused Lynch and different Autonomy officers of cooking the books and mendacity about Autonomy’s enterprise and inside a 12 months wrote off $8.8 billion of Autonomy’s worth. HP in 2017 offered the Autonomy property to Micro Focus.

After buying Autonomy, HP sued Lynch within the Excessive Court docket. HP received the six-year court docket in 2022 after a Excessive Court docket choose discovered Lynch responsible of defrauding HP by inflating the worth of the software program firm.

The one-time finance director at Autonomy, Sushovan Hussain, is serving a five-year sentence within the US after being convicted of fraud in 2019 in reference to the cope with HP.

The Register has reached out to HP for remark, in addition to to UK-based cybersecurity agency Darktrace, wherein Lynch’s funding fund – Invoke Capital – was its first investor and reportedly continues to carry a 4.2 p.c stake. Lynch and his spouse, Angela Bacares, nonetheless maintain a major share of Darktrace, although in February the couple offered about $124 million within the enterprise’s shares.

A Darktrace spokesperson informed The Guardian that Lynch has “no operational, advisory or some other position at Darktrace,” including that his solely connection was by means of the shares he nonetheless holds. ®