Hard drives at Autonomy offices were destroyed the same month CEO Lynch quit, extradition trial was told
- Reference: 1627552906
- News link: https://www.theregister.co.uk/2021/07/29/autonomy_founder_lynch_extradition_ruling/
- Source link:
District Judge Michael Snow ruled last week that Lynch [1]can be extradited to America for trial on 17 criminal charges, sending the case to Home Secretary Priti Patel for rubberstamp approval.
Westminster Magistrates' Court has now released Judge Snow's full written judgment
[2]PDF
, which contained pointed criticisms of Lynch's legal team on top of dismissing all their arguments against extraditing the Autonomy founder.[3]
It also revealed that the US accuses Lynch of a conspiracy to destroy evidence, including asking an unnamed "co-conspirator" to destroy hard drives and wipe a laptop and its backups. The latter two are said to have belonged to Autonomy finance veep Steve Chamberlain, who was indicted alongside Lynch in America.
[4]
[5]
The destruction was not referred to in the long-running High Court civil fraud trial between [6]Lynch and Hewlett Packard Enterprise .
Lynch's solicitor told Westminster Magistrates' Court in a witness statement: "Nowhere is it explained that the destruction of hard drives was not at all unusual in light of Autonomy's legitimate and highly sensitive work" for GCHQ and other spy agencies, suggesting that "official directions for the destruction of classified information" might have been to blame.
[7]
Having allegedly taken place in May 2012, the same month that Lynch quit Autonomy after the buyout, the destruction of hard drives and a key finance bod's laptop are key to US Department of Justice accusations that Lynch tried to "obstruct proceedings."
Bad news for Lynch all round
As a separate criminal process from the long-running High Court civil case, the extradition case relies on separate findings of fact made by Judge Snow – none of which appear helpful to Lynch's team.
He wrote: "I am satisfied that the huge financial losses caused to HP in the USA, the losses suffered by American investors and the significant reputational damage caused to HP strongly favours extradition."
The US Embassy in London filed a [8]request to extradite Lynch in December 2019 . He is charged with wire fraud, specifically falsely inflating the value of Autonomy before it was [9]sold to HP for circa $11bn in 2011 . HP then wrote down the book value of Autonomy by [10]$8.8b n. A separate civil case brought by HPE has been heard in the UK court system and judgment is pending.
Addressing [11]evidence given by Lynch's solicitor Kelwin Nicholls , Judge Snow thundered: "I am satisfied that statements made by Mr Nicholls in relation to the standing of the evidence in the civil proceedings is a partisan view of the effect of the evidence and could easily be mistaken as being unarguable when the interpretation remains hotly contested."
[12]
Nicholls made two witness statements for the extradition case, describing the US government's extradition request as "misleading and/or misleadingly incomplete" and Lynch's version of events as "incapable of legitimate dispute." His second witness statement was a paragraph-by-paragraph fisking of the US Department of Justice's formal declaration
[13]PDF, 45 pages
in support of extradition, and the 118 pages of dense analysis Nicholls produced seemed to have actively annoyed Judge Snow.During the court hearing earlier this year, Nicholls was [14]accused by the US's barrister, Mark Summers QC, of having "overstepped the line and advocated for Dr Lynch." In his ruling, Judge Snow adopted Summers' putdown of Lynch's solicitor as a statement of fact, adding: "Even on Mr Nicholls' own evidence it is agreed that the defendant performed alleged overt acts in furtherance of the conspiracy [to defraud HP by overinflating Autonomy's accounts] ; this is sufficient to establish that conduct occurred in the USA."
Hit for six
A key part of any extradition case from the UK is establishing that allegedly criminal behaviour had an effect in the country requesting the extradition.
[15]Autonomy founder Mike Lynch loses first stage in fight against extradition to US
[16]Deloitte settled HPE's Autonomy lawsuit for $45m back in 2016 and agreed to cooperate with US DoJ
[17]HPE urges judge to pick through Deloitte-bashing report it claims demolishes Autonomy founder's defence
[18]Court witness describes how Autonomy founder Lynch would wash his rear-end in US prison showers and dorms
Judge Snow tossed aside Lynch's arguments that the Autonomy buyout and write-down's effects were not felt in the US, saying: "The money used to purchase Autonomy was HP's money whether it was held offshore (as part of it was) or within the USA (as part of it was)… harm is not to be assessed solely on the basis of where the money was paid."
Lynch's lawyers also tried claiming that the Americans waited for two years longer to charge him with criminal offences than they did for his co-conspirators. The British exec said this delay was because prosecutors were hoping to obtain documents from the UK civil trial against him – and that they were hoping to make Autonomy CFO ( [19]and jailbird ) Sushovan Hussain testify against him, in the same way as Autonomy's top US salesman, Christopher "Stouffer" Egan, was brought in to testify against Lynch after signing a [20]plea bargain forcing him to do so .
"Even if the reason for the delay was solely to 'flip' Mr Hussain, which is not my finding, I would not conclude that it would be unjust to order the Defendant's surrender," concluded Judge Snow.
He also threw out Lynch's legal arguments that HPE is colluding with the US Department of Justice in the bringing of parallel civil and criminal cases against him, ruling: "The Government was not a party to the civil suit which was brought on behalf of HP. The Government's criminal allegations are based on its own evidence. The Government's conduct of criminal proceedings is not bound by the way HP chose to run its civil suit."
Mr Justice Hildyard, the High Court trial judge presiding over the civil case, mentioned US pressure on his courtroom during the trial – especially during the early stages when US prosecutors coincidentally announced fresh charges against Lynch days before the civil trial began in London.
Forum bar was hurdled over
Damningly for Lynch, Judge Snow also comprehensively demolished his main argument against extradition: the UK's forum bar. Section 83A of the Extradition Act 2003 says an extradition can be halted if it is against "the interests of justice" to do so, having been brought in after [21]the Gary McKinnon hacking allegations case in the 2000s.
On US criminal charges 1 to 16, Judge Snow ruled that Autonomy's alleged accounting fraud "was always intended to fall on a US-based entity," going on to approvingly quote HPE's assertions that the Autonomy "smear campaign" had caused "lasting reputational injury... inflicted immeasurable harm to us, to our reputation, and to our brand."
Despite suggestions that Britain's Serious Fraud Office (SFO) could prosecute Lynch in the UK if they felt like it, the SFO declined to to do and handed the case over to the US. Based on testimony from SFO solicitor Ronan Duff, Judge Snow said the SFO's witness evidence would "not have constituted admissible evidence in the English courts" and that it might be difficult to obtain the co-operation of US-based witnesses in a UK prosecution.
Numerous US-based witnesses testified during the High Court civil trial. Nonetheless, the SFO said America was the best place for a criminal prosecution and the judge adopted that.
Lynch's US attorney, Chris Morvillo, told the court a criminal trial is likely to take place in 2023. If he loses that case, Lynch faces being fined £578m ($804m) in forfeiture to the American government, with his co-defendant Stephen Chamberlain potentially on the hook for $4m.
The extradition case against Lynch continues. ®
Bumnote
There was also the delicate matter of Joel Sickler, Lynch's other live witness. Sickler, called to testify as an expert on US prison conditions, spent an inordinate amount of time [22]ranting on about Lynch's specialised washing regime , necessary thanks to a medical condition, among other things. (sample: "Prison litigation in the US has become almost frivolous. Courts look at these suits as frivolous and they don't necessarily hold – few and far between, do they hold corrections agencies, departments and the BOP [Bureau of Prisons] accountable. The burden of proof is so, so high!")
The judge commented: "I am satisfied that Mr Sickler was an unreliable partisan witness who has exaggerated his evidence that he has presented, on occasions in a misleading way."
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[1] https://www.theregister.com/2021/07/22/mike_lynch_extradition_bid_first_stage_loss/
[2] https://regmedia.co.uk/2021/07/27/usa_v_lynch_judgment_westminster_mags.pdf
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YQLQrjgWqjzWbQ3A6hqWYQAAAA0&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YQLQrjgWqjzWbQ3A6hqWYQAAAA0&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[5] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YQLQrjgWqjzWbQ3A6hqWYQAAAA0&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[6] https://www.theregister.com/2021/03/25/hpe_v_lynch_high_court_roundup/
[7] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YQLQrjgWqjzWbQ3A6hqWYQAAAA0&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[8] https://www.theregister.com/2019/12/02/us_embassy_files_extradition_request_for_mike_lynch/
[9] https://www.theregister.com/2011/08/19/hp_buys_autonomy/
[10] https://www.theregister.com/2012/11/20/hp_alleges_autonomy_fraud/
[11] https://www.theregister.com/2021/02/11/lynch_extradition_criminal_charges_never_dropped/
[12] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YQLQrjgWqjzWbQ3A6hqWYQAAAA0&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[13] https://regmedia.co.uk/2021/07/27/autonomy_leach_declaration_extradition_us_doj.pdf
[14] https://www.theregister.com/2021/02/11/lynch_extradition_criminal_charges_never_dropped/
[15] https://www.theregister.com/2021/07/22/mike_lynch_extradition_bid_first_stage_loss/
[16] https://www.theregister.com/2021/03/29/deloitte_settled_hpe_lynch_lawsuit_45m/
[17] https://www.theregister.com/2021/02/26/hpe_lynch_frc_report_extra_evidence_application/
[18] https://www.theregister.com/2021/02/12/lynch_extradition_sickler_testimony/
[19] https://www.theregister.com/2020/08/27/sushovan_hussain_autonomy_appeal_loss/
[20] https://www.theregister.com/2019/05/09/autonomy_trial_stouffer_egan_mike_lynch_evidence/
[21] https://www.theregister.com/2012/10/17/gary_mckinnon_mother_extradition_change/
[22] https://www.theregister.com/2021/02/12/lynch_extradition_sickler_testimony/
[23] https://whitepapers.theregister.com/
Re: Lynched?
There seems to be a general belief that a far higher proportion of extradition requests made by the US succeed than the proportion made by the UK that succeed. I was surprised to find that this is not the case, at least according to these data from an FOI request:
https://www.gov.uk/government/publications/extradition-requests-between-the-uk-and-us-from-april-2007-to-may-2014/extradition-requests-between-the-uk-and-us-from-april-2007-to-may-2014
I didn't find any data relating to the period after May 2014, but I didn't look very hard.
Re: Lynched?
'I was surprised to find that this is not the case, at least according to these data from an FOI request:"
You need to check the figure for US snd UK citizens.
The vast majority of extraditions from the US to the UK are not US citizens, but UKers on the run etc.
Suprisingly very few US citizens head to the UK to try and escape justice.
Check David Davis' statement in Parliament:
https://hansard.parliament.uk/commons/2020-01-23/debates/B8A31ACD-FF42-42F5-9F94-D5D53ACC946C/UK-USExtraditionAgreement
"Since 2007, the UK has surrendered 135 UK nationals to the US, 99 of them for non-violent alleged offences. During the same period, the US has surrendered only 11 people to the UK. "
Re: Lynched?
"There seems to be a general belief...", no, that's a bait and switch. There are genuine problems here.
Probable cause vs reasonable suspicion.
One is an allegation (suspicion), one is evidence of a crime ("probable cause"). US citizens are protected at the higher "probable cause" level, this treaty set the bar at the lower "reasonable suspicion" for UK citizens.
All the work the US judiciary have done in defining (by eliminating) tranches of evidence/claims that represent "suspicion" but don't meet the "probable cause" level, for US citizens, all wiped away for UK citizens. Theresa May's twatty response to this was to get a judge to pretend the two are comparable. If they were comparable, then raise the level to "probable cause"!
Then there's the jurisdiction shopping. The prosecution isn't where the crime was alleged to have been committed, where the witnesses are, where the evidence is, where the accounting practises are defined, where the closest determination of truth is likely to be met. No, its wherever the best chance of prosecution exists, truth be damned, lets get a prosecution!
Here that is Narnia, since Meg's valuation of Autonomy was ridiculous, a Narnia fantasy, and thus the huge $8 billion drop in that fantasy was also in Narnia. Which is great if you're extraditing to Narnia for damages to Narnia!
Should UK citizens be entitled to the jurisdiction most likely to determine the truth of a situation? Or be sent to the jurisdiction most likely to get them prosecuted? Obviously the first not the second.
Then there's the restatement of 2010 revenue. Released in early 2014, after another disasterous year at HP. ~$127 billion from 2010 to ~$112 billion by end 2013.
Not Autonomy's fault, but certainly useful in deflecting the reality. Market it as a "54% drop in revenue" or an "$8 billion writedown" and who will read the small print and realize it is not the cause of the $15 billion drop! It wouldn't even make a dent in that drop.
So, why would I take that restatement as reality? How do I know that it wasn't simply false numbers from Narnia land, released to save HP's management? Evidence is how! "probable cause" is how!
Re: Lynched?
special relationship == bitch.
Having said that, trying to defend yourself in court against the idea of going to jail by claiming that jails are nasty ought to result in a stretch for the both of them.
but but but your honor I cant go to jail, I'm rich!
Re: Lynched?
While I sympathise with your point of view I think the thrust of the argument is that US prisoners are held in conditions that even the UK prison service would count as inhuman.
Whether Mr Lynch would be destined for "that" kind of US prison or not is another question....
Re: Lynched?
So? I always fail to see the merit of this argument whether it is applied to stupid people who smuggle drugs in Thailand (or a similar regime) or old men who steal money from Americans. If you can't do the time in the relevant juristiction don't do the crime. And, don't go crying about your human rights after the fact, you gave them up when you decided to break the law.
Re: Lynched?
While not disagreeing with the thrust of your argument, I feel compelled to point out that human rights are, by definition, the rights you *don't* lose when you break the law. Otherwise you end up living in some dystopian hell-hole like Pooh Corner.
Re: Lynched?
... a stupid buy by HP ...
... HP had more than enough people and advisors ...
... disgusting that they can extradite from UK to US because some idiots over payed ...
Indeed.
Al this is a scam to cover up what sums up misadministration on behalf of HPs board.
Over 8.0 billion in misadministration.
He wrote: "I am satisfied that the huge financial losses caused to HP in the USA, the losses suffered by American investors and the significant reputational damage caused to HP strongly favours extradition."
Seeing that Lynch was not prosecuted in the UK by the Serious Fraud Office (SFO) for this HP mess, makes me wonder how much it took to convince judge Snow.
I'm' talking about evidence , of course.
O.
Re: Lynched?
"It was a stupid buy by HP I don't see why they get to drag the seller through the courts though. HP had more than enough people and advisors to ensure they paid the correct price."
Not true. There is a long, long history of deals that went poorly due to [blind] oversight, obstruction or outright malfeasance during, what should have been, an investigation into the books of the company prior to buyout or merger. As a Lark (ha-ha, wordplay there) let us mention Studebaker and Packard, for one.
Re: Lynched?
I would agree with your view on extradition but fraud is still fraud and being a superb snakeoil salesman should not count as less fraud.
Wow, an entire experienced expert team of HP lawyers, acquisition specialists, financial bods, and so on, were somehow hoodwinked by a couple of people. Amazing. This really reflects poorly on HP, even if Lynch did buff up the valuation (somewhat akin to someone wet wiping something shiny before listing on ebay). This is just a vindictive saving face move.
Personally I would stop the extradition because of the lack of reciprocity from the US when we ask for someone to be extradited. The relationship is high on abusive.
There is a genuine opportunity for the government to have closed-door negotiations in relation to an effective swap with Anna Sacoolas.
Both parties will now have pending criminal charges but the money involved and the apparent win for supporting US businesses could have a massive influence on the the Biden administration acquiescing.
Not that I actually think it will happen. We've seen how poor the UK gov is at negotiating.
Data cleansing
I see nothing wrong with destruction of hard drives and computers, it's the safest thing to do to keep your data out of dodgy actors hands.
Re: Data cleansing
Yea, police do it all the times with that body cam footage. Perfectly good technique.
A MisTrial. How can it not be?
Lynch's solicitor told Westminster Magistrates' Court in a witness statement: "Nowhere is it explained that the destruction of hard drives was not at all unusual in light of Autonomy's legitimate and highly sensitive work" for GCHQ and other spy agencies, suggesting that "official directions for the destruction of classified information" might have been to blame.
Is the High Court aware of the valid just reasons for such a direction taken to safeguard and restrict access to and exercise of vital classified information?
The extradition judgment suggests otherwise and thus is an opinion building on matters in which the judge is uninformed rather than misinformed for consideration of future direction/metaphysical reaction ...... or proaction, as can be in so many cases and just causes.
Why are we still extraditing anyone to the USA, while they hold onto Anne Sacolas? Running someone over is a criminal offense in both states. We have presented probable cause that she is responsible. Such a weak, gutless, impotent nation we are, to ignore violations of the treaty by one side and continuing to fulfil our side.
Treaty
The problem is that although the UK accepted the extradition treaty, the US Senate has refused to vote it into law in the USA.
That means they are using our acceptance of a treaty their senate does not recognise to extradite UK nationals (because successive gutless UK governments have bowed down to the USA) while the USA uses the previously accepted treaty to assess whether their own nationals can be extradited to the UK.
The previous treaty requires the courts in the USA to use the probable cause requirement when considering extraditing a US national to the UK, not reasonable suspicion.
Lynched?
Looks like mr Lynch is done for.
It was a stupid buy by HP I don't see why they get to drag the seller through the courts though. HP had more than enough people and advisors to ensure they paid the correct price.
It’s also disgusting that they can extradite from UK to US because some idiots over payed , while they won’t the other way when a US citizen kills someone over here then runs back to the US to evade justice.