UK tech tycoon fights US extradition over ill-fated HP deal

A British tech entrepreneur appeared in a London court Tuesday to fight extradition to the United States on fraud charges stemming from his firm’s takeover by Hewlett-Packard a decade ago.

US prosecutors say Michael Lynch inflated the value of his software company, Autonomy, before it was bought by Hewlett-Packard for US$11 billion in 2011. HP wrote off most of the Autonomy purchase price the following year, and the debacle triggered a boardroom shake-up at the American tech company.

“This was an English company, cooking its books in England, making it appear what it wasn’t, and then persuading an American company to grossly overpay for it, based on those cooked books,” Mark Summers, a lawyer representing the US government, told a hearing at Westminster Magistrates’ Court.

“The only unusual feature of this case was the titanic scale of the money involved,” he added.

Lynch faces 17 criminal charges in the US including wire fraud, securities fraud and conspiracy to defraud. Supporters say he could face a decade in prison if convicted.

Lynch, 55, denies the allegations, and his lawyers say he should face any criminal proceedings in England. The United Kingdom’s extradition treaty with the US allows judges to refuse to hand over a suspect if most of the alleged wrongdoing took place in Britain.

Hewlett-Packard is also suing Lynch for US$5 billion in damages in a separate civil case in London.