July 21 (Bloomberg) -- Ex-Autonomy Corp. finance chief Shushovan Hussain said Hewlett-Packard Co.’s deal with investors to sue him over its $8.8 billion loss tied to the Autonomy purchase is illegal because it shields HP executives from blame.
The settlement of three shareholder suits against HP “seeks to forever bury from disclosure the real reason for its 2012 writedown of Autonomy: HP’s own destruction of Autonomy’s success,” Hussain said in a filing today in San Francisco federal court. He asked the judge overseeing the cases for permission to challenge the accord. A hearing is scheduled for Aug. 25. The judge must approve the deal.
The allegation by Hussain is the latest volley from ex-Autonomy executives in a fight over who’s to blame for the purchase. HP alleged the U.K.-based software company had accounting irregularities and that HP was the victim of fraud by Autonomy management. Ex-Autonomy executives contend Palo Alto, California-based HP botched the acquisition.
Shareholders sued HP and its top executives claiming the computer-maker ignored warnings about Autonomy’s accounting and mismanaged the buyout. Lawyers for investors in three of the suits said last month in court filings that they were dropping claims against HP after an internal review committee concluded HP executives weren’t to blame. The plaintiffs said they would assist the company in suing ex-Autonomy chief executive Mike Lynch and Hussain.
“Hussain’s opposition to the settlement is baseless,” Howard Clabo, a spokesman for HP, said in an e-mailed statement. “We look forward to the day when a jury gets to hear the evidence of Mr. Hussain’s conduct.”
Hussain’s lawyer, John Keker, said in the filing that “as a potential future defendant, his client ‘‘may be in a position to assert counterclaims or other claims, including for indemnity and contribution.’’
Under their agreement with HP, shareholder lawyers stand to make as much as $48 million for helping the company, while backing off the claims they made in lawsuits seeking to hold its executives accountable for the writedown, Keker said.
‘‘Suddenly plaintiffs’ counsel do a total about-face, buying the very story they rejected last year,’’ he said.
The case is In Re HP Derivative Litigation, 12-06003, U.S. District Court for the Northern District of California. (San Francisco).
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