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Good morning. Mike Lynch, once one of the UK’s leading technology entrepreneurs, was acquitted of criminal charges by a jury in San Francisco yesterday, bringing to an end a 12-year legal battle that began in one of Silicon Valley’s biggest fraud cases.
The former Autonomy CEO was accused of falsely inflating the company’s revenue before it was sold to Hewlett-Packard for $11 billion in 2011. The verdict marked a vindication for Lynch after a lengthy battle that saw him extradited to the US ahead of trial and placed under house arrest under 24-hour guard.
Lynch, 58, has long argued that he was made a scapegoat for HP’s failed acquisition of Autonomy and subsequent mismanagement, and unsuccessfully argued that criminal charges should be brought in Britain.
Following her acquittal, Lynch said she was “delighted” and “looking forward to returning to the UK and getting back to what I love most – my family and innovating in my field.”
Here’s what I’m focusing on today and this weekend:
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Economic data: According to a survey of economists conducted by LSEG, U.S. employment is expected to increase by 185,000 in May, well above April’s gain of 175,000. The unemployment rate is expected to remain stable at 3.9 percent. The Canadian economy is forecast to have added 22,500 jobs last month, following a rise of 90,400 in April. The unemployment rate is expected to rise to 6.2 percent.
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Russia: The Russian Central Bank will announce its interest rate decision today, while President Vladimir Putin will speak at the St. Petersburg International Economic Forum.
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EU elections: Parliamentary elections continue until Sunday, with voting taking place in Ireland, Italy, Belgium and Germany today and over the weekend. Don’t miss this morning’s Europe Express, with Henry Foy explaining the elections, which will be free to all subscribers today and on Monday.
How much of the news have you been following this week? Take the quiz.
Five more top stories
1. Artificial intelligence leaders in California are protesting a state bill that would require tech companies to adhere to a strict safety framework. This includes creating a “kill switch” to turn off powerful AI models. “This bill creates huge liabilities for science fiction risks,” said Andrew Ng, a prominent computer scientist who leads AI projects at Alphabet Inc.’s Google and China’s Baidu, and sits on Amazon’s board of directors. Here’s how the industry is reacting to the bill:
2. Hallie Biden told jurors she was “ashamed and ashamed” about the series of events nearly six years ago that led to the gun crimes charges against Hunter Biden. Her former brother-in-law and lover. Her testimony marked a critical juncture in the federal trial that is intertwined with the presidential election. Here’s more of what Hallie Biden told the jury in a Delaware courtroom.
3. Private equity executives have warned that the industry could face declining profit margins for years to come as they seek to sell assets. It follows a flurry of investment during the coronavirus pandemic. “That was a period when interest rates were low and valuations were high,” Pete Stavros, co-head of global private equity at KKR, said yesterday at the “SuperReturns” industry conference in Berlin.
4. Credit Suisse’s creditors sued Switzerland over its decision to write off $17 billion in debt. The Swiss bank was rescued by rival UBS last year, and in the first major lawsuit filed in a U.S. court over the takeover, lawyers representing the group alleged that the Swiss had wrongfully violated their property rights in orchestrating the deal.
5. Shares in Exosens, a French manufacturer of military night vision goggles, opened this morning in Paris, up 17%. Exosens is the latest European defence group to go public as the war in Ukraine sees a surge in military orders. In February, German tank gearbox maker Renk listed on the Frankfurt Stock Exchange after a private investment group floated a third of its shares.
Today’s Featured Articles
John Henry’s Fenway Sports Group has become the modern blueprint for transatlantic sports empires, buying and rebuilding struggling organisations since it bought the Boston Red Sox baseball team in 2002 and Liverpool Football Club in 2010. FT Magazine speaks to one of the industry’s most famous yet least understood owners, responsible for ending a World Series curse and a Premier League drought.
We are also reading…
Today’s Chart
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Yesterday, the European Central Bank cut interest rates for the first time in nearly five years, a landmark move in tackling inflation after the biggest price spike in a generation. The quarter-point cut to 3.75% has yet to be made by the central banks of the United States and the United Kingdom.
Take a break from the news
In a studio space tucked away on a side street in this western Ukrainian city, the Lviv State Opera is busily preparing for the national premiere of Francis Poulenc’s Les Ballets Dreams. Carmelite DialogueSet in a monastery during the French Revolution, the opera’s themes of oppression, sacrifice and terror in the shadow of war will be all too familiar to Ukrainians.
Additional contribution by Tee Zhuo, Sophie Spiegelberger and Benjamin Wilhelm
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