Also on Nov. 27, Bernstein Liebhard announced a securities class action. "Defendants concealed that [HP] had gained control of Autonomy in 2011 based on financial statements that could not be relied upon because of serious accounting manipulation and improprieties. In addition, defendants concealed known negative business trends concerning the profit margins of the companys enterprise services business, formerly known as Electronic Data Systems Corporation (EDS), which Hewlett-Packard had acquired in August 2008 for $13.0 billion," officials of the New York-based firm stated.
On Nov. 30, Pomerantz Grossman Hufford Dahlstrom & Gross filed a class action of its own, alleging that "throughout the class period, [HP] made materially false and misleading statements". HP did not reveal that it tried to exit the Autonomy acquisition, the firm claims.
HP also saw its stock downgraded on November 28 by the Moody's service, and took a public critique from Sequoia Capital partner Aaref Hilaly, the former CEO of Autonomy competitor Clearwell which was bought in May 2011 by HP competitor Symantec Corp. "Anyone who's dealt [with] Autonomy (customers, partners, competitors) will not be surprised," he tweeted. HP competitors also took their opportunities to ding the company. OpenText Corp. announced a software trade-in program for Autonomy customers on November 26, followed by a similar announcement from Recommind on Nov. 29.
Corporate matters aside, Autonomy products generally rate well among customers, partners, and technology analysts. Whitman made that point in a November 21 conference call for Autonomy and HP customers, and Araujo emphasized it. "I honestly feel the business is in a better position than it's ever been. I could have done without all of this drama," he noted. "There is no change to our roadmap or our product plans," he said. "We are just much more conscious that we've got to do a really good job with customers than anything else."
Officials said HP and Autonomy intend to announce new products coinciding with HP's user conference December 3-4 in Frankfurt, Germany. HP is based in Palo Alto, Calif.; Autonomy is headquartered in Cambridge, U.K.
For more on the HP-Autonomy story, see The Recorder, In Autonomy Debacle, HP Turns to Morgan Lewis.