US District Judge Charles Breyer in San Francisco granted preliminary approval to the accord Friday, saying that unlike the last proposal it doesn’t provide officers and directors with broad protection against possible lawsuits that have nothing to do with the Autonomy acquisition.
The settlement releases HP from investor claims related to Autonomy in exchange for a set of corporate governance reforms and no money damages.
Executives at HP and Autonomy have been spatting over who’s responsible for the $8.8 billion writedown related to the $10 billion 2011 takeover of the UK software company. HP blamed much of the writedown on inaccurate financial statements, said it was the victim of fraud by Autonomy’s managers. Former Autonomy executives say HP missed it all up.
They argued, HP should be forced to litigate the shareholder suit, because then it would have to reveal documents that the Autonomy bosses believe will exonerate them of any wrongdoing. That doesn’t seem likely to happen.
The governance reforms apply to both entities to be formed when HP splits into two companies.
The reforms include the creation of a senior executive-led risk management committee, modifications to board-level oversight of mergers and acquisitions and a new due diligence policy for mergers.