[Info-vax] HPE going after Mike Lynch's estate

[Chris Townley]

On 18/09/2024 02:12, Arne Vajhøj wrote:
> On 9/16/2024 2:18 PM, Simon Clubley wrote:
>> On 2024-09-16, Arne Vajhøj <arne at vajhoej.dk> wrote:
>>> On 9/16/2024 8:31 AM, Simon Clubley wrote:
>>>> Can I assume that, in order to protect the shareholders, they intend to
>>>> go after the HP management who made the purchase decision in the 
>>>> first place
>>>> without carrying out the due diligence checks before buying Autonomy ?
>>>>
>>>> No, I didn't think so. :-(
>>>
>>> The acquisition was done in the very short reign of Leo Apotheker.
>>>
>>> According to Wikpedia he got 7.2 M$ in severance pay, 3.56 M$
>>> in shares and a performance bonus of 2.4 M$ when he was kicked out
>>> after 10 months.
>>>
>>> And he has done rather well as member/chairman of various
>>> companies boards since then.
>>>
>>> But he does not have 4 B$.
>>
>> The point is to make an example of him for not following established
>> procedures and hence costing them a _lot_ of money.
>>
>> That way, future executives will be less tempted to do the same thing
>> and hence the shareholders benefit.
>>
>> These people get a _lot_ of money. They should have a level of
>> responsibility that matches earning that amount of money.
> 
> I totally agree with that.
> 
> But unless there is a claw back clause in his contract,
> then there is no way to move forward with that.
> 
> And I am a little bit puzzled that you believe that
> the company should try and claw back severance/bonus
> of a an ex-CEO for negligence in an
> acquisition, because it may deter other CEO's from
> doing the same, but you don't believe that the
> company should try and claw back the gain of
> company sale based on fraudulent accounting practices
> from the company's CEO? The CEO avoided jail because
> the court did not find it proven that he knew about the
> fraudulent accounting practices, but while not knowing
> is not an criminal offense, then it is still
> negligence and clawing back the gain may deter other
> CEO's from doing the same.
> 
> Arne

Over here in the UK, we have a legal principle of Caveat Emptor

-- 
Chris