The boss of Hewlett-Packard has defended his company’s decision to continue to pursue Mike Lynch for $4 billion through his family after the tech mogul died in August.
Lynch died alongside his 18-year-old daughter Hannah last month when the Bayesian superyacht he was on ran into a storm and sank within minutes. He was survived by his wife, Angela Bacares, and his other daughter.
In addition to millions of dollars in assets, Lynch left behind the remnants of a multibillion-dollar civil suit in the U.K. that was set to be concluded later this year after a judge ruled Lynch was likely aware of accounting fraud related to HP’s $11.7 billion acquisition of Autonomy.
HPE sought damages of up to $4 billion in the case. However, the judge warned that the payout would be substantially less than that sum.
There was speculation that HPE would choose not to continue its pursuit of Lynch posthumously, owing to the potential for negative press from such a pursuit.
However, last week, the company put that speculation to bed, confirming to Fortune that it would pursue the case to its conclusion.
Antonio Neri, the CEO of HPE, admitted that the case has caused the group a dilemma since Lynch passed away, but he remained steadfast in securing justice.
“Obviously my job as a representative of shareholders is to make the difficult decisions,” Neri told the Financial Times. “These are difficult decisions. But in the end, we are making decisions in the best interest of shareholders.”
As a publicly listed company, HPE has a fiduciary duty to act in the best interest of shareholders. Any decision not to pursue Lynch’s family owing to a bereavement could be viewed as acting against those interests.
HP, as it was previously known before its hardware and software arms split in 2015, faced a lawsuit from investors in the aftermath of the Autonomy deal.
“Obviously what we saw three weeks ago is a sad story. The loss of so many lives, including Dr Lynch. And obviously our thoughts are with them.
“But the reality of what happened does not change what happened in the past decade or so, where we believe wrongdoing was done, and therefore we have to see through the process with the UK judge completing his proceedings,” Neri said.
Lynch battle continues
HP accused Lynch of fraud in the wake of its $11.7 billion purchase of his tech group Autonomy in 2011. The group was forced to write down the value of its acquisition by $8.8 billion a year after the deal, citing “accounting irregularities.”
A U.K. judge ruled in a civil that Lynch was probably aware of the irregularities, leaving him liable for damages. Sushovan Hussain, a former Autonomy CFO, received a five-year prison sentence for fraud linked to the deal in 2018.
Lynch was acquitted in a criminal fraud trial in the U.S. in June and was celebrating his victory on the Bayesian yacht when it sank in the Mediterranean Sea last month. He intended to use his acquittal to fight the outcome of the U.K. civil case.
Fortune previously reported that the process of transferring a lawsuit from one person to their estate is straightforward, and in this case is likely to lump Lynch’s widow Bacares with the lawsuit.
Bacares is set to take control of millions of dollars in assets acquired by Lynch throughout his life. The Autonomy founder reportedly received £500 million for the HP acquisition, while he owned around 3% of the British cybersecurity firm Darktrace at the time of his death. His fortune is thought to be much lower than the $4 billion demanded by HPE.
The release of funds from the estate will be delayed until the conclusion of the civil trial, creating a dilemma of its own for the Lynch family over whether they wish to extend a legal battle that has barrelled on for more than a decade.
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