British technology pioneer Mike Lynch acquitted in American fraud trial

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Good morning. Mike Lynch, once one of Britain’s leading tech entrepreneurs, was acquitted of criminal charges by a jury in San Francisco yesterday, ending a 12-year legal saga stemming from one of Silicon Valley’s biggest fraud cases.

The former CEO of Autonomy was accused of falsely inflating revenues at the British software company ahead of its $11 billion sale to Hewlett-Packard in 2011. The verdict is a moment of vindication for Lynch after a long battle that saw him extradited to the US and subjected to house arrest under 24-hour supervision prior to trial.

Lynch, 58, has long claimed he was used as a scapegoat by HP for its own failed takeover and later its mismanagement of Autonomy. He argued unsuccessfully that any criminal charges should be heard in Britain.

After the not guilty verdict, Lynch said he was “delighted” and “looking forward to returning to Britain and getting back to what I love most: my family and innovating in my field”. Read the full story.

Here’s what I’m keeping an eye on today and this weekend:

  • Economic data: Economists expect the U.S. added 185,000 jobs in May, up from 175,000 jobs in April, according to economists surveyed by LSEG. Unemployment is expected to remain flat at 3.9 percent. The Canadian economy is forecast to have added 22,500 jobs last month, after reaching 90,400 jobs in April. The unemployment rate is expected to rise to 6.2 percent.

  • Russia: The Bank of Russia announces its interest rate decision today, while Vladimir Putin speaks at the International Economic Forum in St. Petersburg.

  • EU elections: The parliamentary elections continue until Sunday, with Ireland, Italy, Belgium and Germany voting today and this weekend. Don’t miss this morning’s Europe Express, which will be free to all subscribers today and Monday if Henry Foy calls off the election.

How closely did you follow the news this week? Take our quiz.

Five more top stories

1. Artificial intelligence heavyweights in California are protesting a state law that would force tech companies to adhere to a strict security framework, including creating a ‘kill switch’ to disable their powerful AI models. “It creates enormous risks for science fiction risks,” said Andrew Ng, a renowned computer scientist who led AI projects at Alphabet’s Google and Baidu in China, and who sits on Amazon’s board. Here’s more industry reaction to the bill.

2. Hallie Biden told jurors she was ’embarrassed and ashamed’ as she recounted the sequence of events that led to charges against Hunter Biden nearly six years ago, her former brother-in-law and lover. Her testimony represented a pivotal moment in a federal trial that became embroiled in the presidential race. Here’s more of what Hallie Biden told jurors in the Delaware courtroom.

3. Private equity executives have warned that their industry faces the prospect of years of lower returns as they try to sell assets following a wave of investment during the coronavirus pandemic. “During that period, rates were low and valuations were high,” Pete Stavros, KKR’s co-head of Global Private Equity, told the SuperReturn industry conference in Berlin yesterday.

4. Credit Suisse bondholders sued Switzerland over decision to wipe out $17 billion in debt when the bank was rescued last year by competitor UBS. In the first major claim filed in a US court over the takeover, lawyers representing the group accused Switzerland of wrongfully violating their property rights in orchestrating the deal.

5. Shares of Exosens, a French manufacturer of night vision goggles for the military, rose 17 percent this morning on their debut in Paris. Exosens is the latest European defense group to go public as the war in Ukraine fuels more orders from the armed forces. In February, German tank gearbox manufacturer Renk floated on the Frankfurt Stock Exchange after a private investment group offered a third of its shares to the public.

Today’s big lecture

John Henry at Fenway Park
John Henry at Fenway Park, home of the Boston Red Sox © Cassandra Klos

Since acquiring the Boston Red Sox baseball team in 2002 and Liverpool Football Club in 2010, John Henry’s Fenway Sports Group has become the modern blueprint for a transatlantic sports empire by buying up troubled institutions and turning them around. FT Magazine speaks to one of the industry’s best-known but least understood owners, whose company ended World Series curses and Premier League droughts.

We are also reading. . .

Chart of the day

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Yesterday, the European Central Bank cut interest rates for the first time in almost five years, a step that marked a milestone in the fight against inflation after the biggest price rise in a generation. The quarter-point cut to 3.75 percent has not yet been repeated by the central banks in the US and Great Britain.

Take a break from the news

In a studio space tucked away on a side street in the western Ukrainian city, the Lviv National Opera is busy preparing for the national premiere of Francis Poulenc’s opera Dialogues des Carmelites, set in a nunnery during the French Revolution. In the shadow of war, the opera’s themes of tyranny, sacrifice and terror will be all too familiar to Ukrainians.

A man in uniform and a woman in traditional Ukrainian attire, including a red headscarf, dance in front of a group of spectators
An LNO performance of ‘Stolen Happiness’

Additional contributions by Tee Zhuo, Sophie Spiegelberger And Benjamin Wilhelm

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