A multi-billion-dollar fraud claim against a British entrepreneur is an attempt to "blame other people" for massive losses suffered by American technology giant Hewlett-Packard, the High Court in London has heard.
The claim was made on the third day of a nine-month case against Autonomy founder Mike Lynch in what is believed to be the UK's biggest civil fraud trial.
Hewlett-Packard (HP) is suing Mr Lynch and Autonomy's former chief financial officer Sushovan Hussain for around $5 billion over its purchase of the Cambridge-based firm for $11.1 billion in 2011.
The company claims Mr Lynch "committed a deliberate fraud over a sustained period of time" to artificially inflate Autonomy's value, which it says forced it to announce an $8.8 billion writedown of the firm's worth just over a year after its acquisition.
However, the 53-year-old, from Suffolk, argues that HP "destroyed" Autonomy through mismanagement and is trying to make him "a scapegoat for their failures".
Opening Mr Lynch's case in London today, Robert Miles QC said HP "never did any calculation before announcing that five billion (US dollars) of the writedown was attributable to the wrongdoing by Dr Lynch".
He added that it was "convenient for HP to allocate a large part of the losses to Autonomy" as it mitigated any damage to its "core" hardware business.
Mr Miles said HP employed "an aggressive approach" to "make sure that they got their oar in first", and said the company was "making calls to the Prime Minister's office in the UK" before the company had written to Mr Lynch to inform him of the allegations.
The barrister added that the strategy was "deliberately designed both to protect the CEO and board of HP and, at the same time, to maximise damage to the defendants".
Mr Miles said Mr Lynch founded Autonomy and "built it up into a FTSE 100 company" which was a "market leader in enterprise technology".
By contrast, he added, HP was a "vast but floundering company" which was "a low-growth, low-margin hardware business".
He said Mr Lynch "had not been looking to sell", but saw the "potential combination" of HP and Autonomy as being able to take his company to a "new and next level of development".
Mr Miles added that Mr Lynch intended to stay with the company after the takeover and that he "saw his future as continuing to lead Autonomy, but as part of a larger group".
He told the court that HP had "made its own determination of the price it was prepared to pay" and "carried out its own due diligence", adding that Mr Lynch knew HP would have "full access" to Autonomy's accounts.
But, Mr Miles said, HP's share price fell by 20% within a day of the Autonomy deal being announced and HP's board "suffered a collective loss of nerve", though "under UK takeover rules they were stuck with it".
He said: "Instead of being the means of transforming HP, Autonomy became an awkward embarrassment."
HP removed its CEO Leo Apotheker and its chief strategy and technology officer Shane Robinson, which left the company "without its principal architects of the deal", Mr Miles added.
Mr Miles said HP's new CEO Meg Whitman "made it clear that she was going to take a different tack" and concentrate on HP's "traditional" hardware business, leaving Autonomy as the "'unwanted stepchild', as Ms Whitman once called it".
He accused HP of "blaming other people to protect the back of Meg Whitman and the board".
Mr Miles concluded that HP's case "entails that Mr Lynch must have been monumentally dim", which he clearly is not.
HP claims Mr Lynch and Hussain "artificially inflated Autonomy's reported revenues, revenue growth and gross margins" to boost the value of the company.
On the first day of trial on Monday, HP's barrister Laurence Rabinowitz QC said Mr Lynch and Hussain had knowingly caused Autonomy to "engage in a programme of widespread and systematic fraudulent" accounting practices ahead of the sale.
The barrister said Autonomy had been "meeting its revenue and revenue growth targets by simply buying and selling third party hardware, without any connection to Autonomy software".
He added that the firm also used "a variety of other fraudulent devices" to either accelerate revenue or to invent revenue that never existed in the first place.
Mr Rabinowitz told the court: "Once these fraudulent practices are stripped away, it becomes clear that, in truth, the Autonomy group was experiencing little growth and was falling consistently short of market expectations."
In separate criminal proceedings in the US, Mr Lynch faces 17 charges of securities fraud, wire fraud and conspiracy in a federal court over the sale of Autonomy and, if found guilty, could face up to 25 years in jail.
Hussain was convicted last April in the US of wire fraud and other crimes related to Autonomy's sale and is due to be sentenced in May, but is expected to appeal against his conviction.
The High Court hearing before Mr Justice Hildyard, which is due to finish in December at the earliest, continues.