Hewlett-Packard Company (NYSE:HPQ) agreed to settle the three lawsuits filed by its shareholders in connection with its $11.1 billion acquisition of Autonomy, a British software company, according to report from Reuters.
Settlement agreement details
Under the terms of the settlement agreement, the lawyers representing the shareholders in the three lawsuits agreed to drop all the allegations against the current and former executives of Hewlett-Packard Company (NYSE:HPQ) including its CEO Meg Whitman, board members and advisers.
According to source, the former executives of Autonomy are excluded from the settlement. Hewlett-Packard Company (NYSE:HPQ) agree to help lawyers of the shareholders to pursue their claims against Michael Lynch, co-founder and former CEO of Autonomy, Sushovan Hussai, former CTO and other executives.
The nature of the complaint that would be filed by the shareholders of Hewlett-Packard Company (NYSE:HPQ) against the former executives of Autonomy is still unknown. According to sources, the PC maker is expected to announce the settlement on Monday.
The shareholders of Hewlett-Packard Company (NYSE:HPQ) filed lawsuits against it after recording $8.8 billion in impairment charges related to the acquisition of Autonomy in November 2012. At the time, the PC maker explained that $5 billion of those charges were caused by “serious accounting improprieties, misrepresentation and disclosure failures” of the former management of Autonomy.
Lynch strongly and repeatedly denied the allegations of Hewlett-Packard Company (NYSE:HPQ). Last March, he said HP is not just smearing the former management team of Autonomy, but also misleading its shareholders.
According to Lynch, HP “selectively leaked documents and information to the international media, frequently using material taken out of context to create false impressions and smear our reputations.”
Hewlett-Packard previously settles class action lawsuit
Last April, Hewlett-Packard Company (NYSE:HPQ) agreed to pay $57 million to settle a class action lawsuit filed by shareholders who alleged that the former management of the company led by Leo Apotheker defrauded them by abandoning its business model.
Regulators launch investigation
Regulators including the U.S. Securities and Exchange Commission (SEC), Federal Bureau of Investigation (FBI) and United Kingdom’s Serious Fraud Office (SFO) launched an investigation after Hewlett-Packard Company (NYSE:HPQ) made its allegations of accounting improprieties, misrepresentation and disclosure failures of the former executives of Autonomy.