|By Maureen O'Gara||
|November 28, 2012 06:00 AM EST||
HP was sued Monday in a San Francisco federal court by shareholders irate over how its $8.8 billion write-off last week drove the stock to the ground.
HP claimed Autonomy inflated its value through falsified financials before it was acquired in October for $11.1 billion. HP said the scheme, involving improper revenue recognition, was disclosed by a senior Autonomy official in May.
The class-action complaint, which also alleges mismanagement because of the $8 billion EDS write-off in August, was filed by the law firm of Robbins Geller Rudman & Dowd LLP.
It won't be the last. Johnson & Weaver LLP and Hagens Berman Sobol Shapiro LLP, both so-called shareholder-rights law firms, are looking at HP and its board for potential breaches of fiduciary duties and violations of federal securities laws in connection with the Autonomy acquisition.
Since Autonomy's founder Mike Lynch has denied the accusations of intentional manipulation Hagens Berman wonders if HP's board is properly painting itself as a victim of the alleged fraud, or if it failed to do due diligence on Autonomy.
Like many people it wonders "How could they miss a gap in the value of Autonomy by such a wide margin?"
HP says it has turned the case over to American and UK regulators and the FBI has reportedly picked up the investigation. HP mentioned filling its own suit too.
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