US prosecutor demands emails from Darktrace following Mike Lynch fraud case
US authorities are attempting to force Darktrace to hand over emails and documents following the ongoing fraud case against technology entrepreneur Mike Lynch.
As a founding investor of the FTSE 100 cyber security darling, US prosecutors have applied for subpoenas against current Darktrace chief executive Poppy Gustafsson and six other employees of Lynch’s previous software company Autonomy.
Subpoenas is used for the purpose of obtaining discovery, and according to federal court filings, the US government is looking to “show the financial and professional dependency of these persons on Lynch”.
On the request for information, the application said”: “All followed Lynch from Autonomy to HP in 2011, and then to Invoke Capital or Darktrace in 2012 or later. The circumstances under which these persons were hired and retained by Invoke Capital (or Darktrace, in which Invoke Capital held a controlling interest for years) are relevant.”
Since four of the six requests are made towards non US citizens, including Poppy Gustafsson, the authorities may have to ask courts in the UK and Italy to acquire the files.
Lynch has been accused of 17 counts of conspiracy and fraud over the £7bn sale of Autonomy to Hewlett Packard in 2011, including claims of “hush money”.
Lynch denies all claims and has been fighting US efforts to extradite him to face trial.
A spokesman for Dr Lynch said: “Although Invoke created the original Darktrace and its founding technology, for years it has run independently of Invoke. The DOJ assertion contains inaccuracies. To our knowledge none of the individuals named were given packages differing from the modest end of industry norms. The fact that years later the low value options granted in the Darktrace startup have by virtue of its success become valuable is not relevant. This subpoena is a distraction from the recent revelations in the case.”
City A.M. exclusively reported this week that Lynch’s co-defendant, Stephan Chamberlain, attempted to discredit the evidence of two City analysts who testified against Autonomy executives in previous court cases.
He claimed that Daud Khan and Paul Morland communicated with short sellers, had knowledge of accounting practises which they later claimed to be ignorant of and were driven by personal animus towards Lynch and Autonomy
However, Khan said that these claims were “baseless”.
HP has separately sued Mr Lynch in the English courts for $5bn (£3.7bn).