Former Autonomy executives, however, will not be exempt from additional litigation, which could continue for a long while.
Hewlett-Packard and a group of irate key shareholders have laid down their arms and come to an initial agreement to settle three lawsuits involving the messy $11.1 billion acquisition of U.K.-based big data search and analytics software maker Autonomy, Reuters reported June 27.
The settlement is expected to be announced as soon as June 30, a source told the news service.
If the settlement takes place, attorneys for the shareholders will drop all claims against HP's current and former executives—including CEO Meg Whitman, current board members and advisers to the company—the source told Reuters.
HP's CEO at the time of the acquisition in fall 2011 was Leo Apotheker, who served in the job for 11 months and pushed hard for the deal. Whitman, who succeeded him in September 2011, was a member of board when the deal was being considered.
Former Autonomy CEO Still on Hot Seat
Former Autonomy executives, however, will not be exempt from additional litigation. As part of the agreement, the shareholders' attorneys will assist HP in pursuing claims against Autonomy co-founder and former CEO Mike Lynch, its former Chief Financial Officer Sushovan Hussain and others related to Autonomy, Reuters said.
Soon after the acquisition took place, it was apparent to insiders at HP that there were serious problems with both the software and with the financials. eWEEK
was told in confidence that the search and analytics software was slow and difficult to parse—even for expert storage and database administrators—and also that the sales numbers simply didn't add up in the accounting office.
Lynch, who has a doctorate from the University of Cambridge in signal processing, has disputed HP's accusations that he or any other Autonomy executives doctored financial records before the deal. He has charged that HP's mishandling of the company after the acquisition created the problems.
Autonomy first attracted HP's attention as an all-in-one solution to its unstructured data storage, enterprise search and secure data movement needs. The U.K.-based company's IDOL enterprise search engine software also enables enterprises to search for and retrieve information in databases and other repositories throughout IT networks.
HP Trying to Use Autonomy IP as Much as Possible
HP has been integrating parts of the Autonomy software suite
into functions such as backup, disaster recovery, Web services distribution and several others.
The lawsuits were first brought by the shareholders May 3, 2013
, in U.S. District Court in San Francisco; they accused current and former HP executives of failing to do the needed due diligence ahead of the deal for a company that the shareholders called "a polluted and vastly overvalued asset."
The result of the alleged negligence by the executives and directors was a $8.8 billion write-down on the deal HP announced in November 2012—only a year after the deal closed. More than $5 billion of that was linked to what HP said at the time were "serious accounting improprieties, misrepresentation and disclosure failures."
According to the lawsuit, the resulting drop in HP's stock price effectively wiped billions of dollars from the company's market value.
The lawsuit also claims that HP, desperate to get in on the burgeoning big data software market, vastly overpaid for Autonomy software that was "an outdated product that was not user-friendly."
eWEEK editors Jeff Burt and Darryl Taft contributed to this story.