Peregrine Systems
Encyclopedia
Peregrine Systems, Inc., an enterprise software company, was founded in 1981 and sold enterprise asset management
, change management
, and ITIL
-based IT service management
software. Following an accounting scandal and bankruptcy in 2003, Peregrine was acquired by Hewlett-Packard
in 2005. HP now markets the Peregrine products as part of its IT Service Management solutions, within the HP Software Division portfolio.
. The founders and employees were Chris Cole, Gary Story, Ed Beck, Kevin Keyes and Richard Diederich. They started selling PNMS on a Series One
computer while developing an MVS version.The MVS client/server solutions for PNMS became available in 1995.
In 1989, John Moores
, founder of BMC Software
and owner of the San Diego Padres
Major League Baseball
team, became a member of the Peregrine Board of Directors. He served as Chairman from March 1990 through July 2000 and then again in 2002. He resigned from the Board in 2003 during the company's bankruptcy filing. His involvement in the software industry continues today with investments through his venture capital
firm JMI Equity
. The legacy of his investments has been focused on ITSM software packages with the most recent investments made in ServiceNow
.
Peregrine had offices in the Americas, Europe and Asia Pacific and grew its product line rapidly both organically and via acquisitions, including Harbinger Corporation in 2000 and Remedy Corporation in 2001.
In 2003, the U.S. Securities and Exchange Commission charged Peregrine with "massive financial fraud" for the purposes of inflating the company's revenue and stock price. Peregrine, without admitting or denying the allegations of the complaint, agreed to a partial settlement.
Peregrine filed suit against its auditor Arthur Andersen in 2002 for $1 billion in damages, for allegedly allowing incorrect audits that overstated revenues by as much as $250 million to be filed for the 2000-2002 fiscal years. In 2003, the former Peregrine CFO, Matthew Gless, pled guilty to fraud charges. In 2008, the former Peregrine CEO, Stephen Gardner, was sentenced to eight years and one month in prison for his role in the fraud, which resulted in bankruptcy for the company. Although former chairman of the board, John Moores, sold more than $800 million of shares during Peregrine's fraudulent period, the court of appeals determined that there was insufficient evidence that Moores knew about the fraud that led to the company’s bankruptcy.
Charges dismissed:
protection on September 23, 2002 after laying off 1400 employees, or nearly half its workforce.. When Peregrine filed for federal bankruptcy protection and eventually canceled its common stocks, more than $4 billion in shareholder equity was lost. After filing, the company sold the Remedy
division of the company to BMC Software
for more than $300 million dollars. Peregrine exited Chapter 11 reorganization in August 2003, and the president and CEO, Gary Greenfield, left the company. Retired software executive John Mutch became president and CEO in August 2003.
(BTO) portfolio within the HP Software Division.
Enterprise Asset Management
Enterprise asset management means the whole life optimal management of the physical assets of an organization to maximize value. It covers such things as the design, construction, commissioning, operations, maintenance and decommissioning/replacement of plant, equipment and facilities...
, change management
Change management
Change management is a structured approach to shifting/transitioning individuals, teams, and organizations from a current state to a desired future state. It is an organizational process aimed at helping employees to accept and embrace changes in their current business environment....
, and ITIL
Information Technology Infrastructure Library
The Information Technology Infrastructure Library , is a set of good practices for IT service management that focuses on aligning IT services with the needs of business. In its current form , ITIL is published in a series of five core publications, each of which covers an ITSM lifecycle stage...
-based IT service management
IT Service Management
IT service management is a discipline for managing information technology systems, philosophically centered on the customer's perspective of IT's contribution to the business. ITSM stands in deliberate contrast to technology-centered approaches to IT management and business interaction...
software. Following an accounting scandal and bankruptcy in 2003, Peregrine was acquired by Hewlett-Packard
Hewlett-Packard
Hewlett-Packard Company or HP is an American multinational information technology corporation headquartered in Palo Alto, California, USA that provides products, technologies, softwares, solutions and services to consumers, small- and medium-sized businesses and large enterprises, including...
in 2005. HP now markets the Peregrine products as part of its IT Service Management solutions, within the HP Software Division portfolio.
History
Peregrine Systems was founded in 1981 in Irvine, CaliforniaIrvine, California
Irvine is a suburban incorporated city in Orange County, California, United States. It is a planned city, mainly developed by the Irvine Company since the 1960s. Formally incorporated on December 28, 1971, the city has a population of 212,375 as of the 2010 census. However, the California...
. The founders and employees were Chris Cole, Gary Story, Ed Beck, Kevin Keyes and Richard Diederich. They started selling PNMS on a Series One
IBM Series/1
The IBM Series/1 computer is a 16-bit minicomputer, introduced in 1976, that in many respects competed with other minicomputers of the time, such as the PDP-11 from Digital Equipment Corporation and similar offerings from Data General and HP...
computer while developing an MVS version.The MVS client/server solutions for PNMS became available in 1995.
In 1989, John Moores
John Moores (baseball)
John Jay Moores is an American entrepreneur and philanthropist, and the owner of the San Diego Padres.-Early years:...
, founder of BMC Software
BMC Software
BMC Software, Inc. is a multinational corporation specializing in Business Service Management software, with record annual revenue in fiscal 2009 of $1.87 billion...
and owner of the San Diego Padres
San Diego Padres
The San Diego Padres are a Major League Baseball team based in San Diego, California. They play in the National League Western Division. Founded in 1969, the Padres have won the National League Pennant twice, in 1984 and 1998, losing in the World Series both times...
Major League Baseball
Major League Baseball
Major League Baseball is the highest level of professional baseball in the United States and Canada, consisting of teams that play in the National League and the American League...
team, became a member of the Peregrine Board of Directors. He served as Chairman from March 1990 through July 2000 and then again in 2002. He resigned from the Board in 2003 during the company's bankruptcy filing. His involvement in the software industry continues today with investments through his venture capital
Venture capital
Venture capital is financial capital provided to early-stage, high-potential, high risk, growth startup companies. The venture capital fund makes money by owning equity in the companies it invests in, which usually have a novel technology or business model in high technology industries, such as...
firm JMI Equity
JMI Equity
JMI Equity is a growth equity firm focused on investing in leading software, internet, business services and healthcare IT companies. JMI provides capital for growth, recapitalizations, acquisitions and buyouts. Founded in 1992, JMI has invested in more than 100 companies throughout North...
. The legacy of his investments has been focused on ITSM software packages with the most recent investments made in ServiceNow
ServiceNow
ServiceNow is a software-as-a-service provider of IT service management software. It was founded in 2003 by Fred Luddy, previous CTO of Peregrine Systems. After building a generic workflow framework , Luddy opted to specialize in IT Service Management applications...
.
Peregrine had offices in the Americas, Europe and Asia Pacific and grew its product line rapidly both organically and via acquisitions, including Harbinger Corporation in 2000 and Remedy Corporation in 2001.
Fraud
In 2004, a federal grand jury issued an indictment charging eight former executives of Peregrine Systems, Inc., one former outside auditor of Peregrine, and two outside business partners of Peregrine, with conspiracy to commit a multi-billion dollar securities fraud. The case resulted from an investigation by the Federal Bureau of Investigation, and the Securities and Exchange Commission had pursued a parallel civil enforcement action.In 2003, the U.S. Securities and Exchange Commission charged Peregrine with "massive financial fraud" for the purposes of inflating the company's revenue and stock price. Peregrine, without admitting or denying the allegations of the complaint, agreed to a partial settlement.
Peregrine filed suit against its auditor Arthur Andersen in 2002 for $1 billion in damages, for allegedly allowing incorrect audits that overstated revenues by as much as $250 million to be filed for the 2000-2002 fiscal years. In 2003, the former Peregrine CFO, Matthew Gless, pled guilty to fraud charges. In 2008, the former Peregrine CEO, Stephen Gardner, was sentenced to eight years and one month in prison for his role in the fraud, which resulted in bankruptcy for the company. Although former chairman of the board, John Moores, sold more than $800 million of shares during Peregrine's fraudulent period, the court of appeals determined that there was insufficient evidence that Moores knew about the fraud that led to the company’s bankruptcy.
Sentences
- Stephen Gardner (former Peregrine CEO): 97 months in custody.
- Douglas Powanda (former Peregrine Executive Vice President for World Wide Sales): 78 months in custody followed by two years of supervised release.
- Matthew Gless (former Peregrine CFO): 63 months in custody followed by two years of supervised release.
- Andrew Cahill (former Peregrine Exceutive Vice President for World Wide Sales, after Powanda): 22 months in custody followed by two years of supervised release.
- Jeremy Crook (former Peregrine General Manager for Europe): 27 months in custody.
- Steven Spitzer (former head of Peregrine's Alliance Sales Program): Three years probation, a $5,000 fine and 200 hours of community service plus a $110,000 civil penalty and barred from serving as an officer or director of any public company.
- Berd J Rassam (former Peregrine Controller): 19 months in custody followed by two years of supervised release.
- Larry Rodda (former managing director of KPMG ConsultingBearingPointBearingPoint is an independent management and technology consulting firm. Following a post-bankruptcy management buyout in August 2009, BearingPoint has been operated by its European management team and is organized as a partnership...
): Six months in custody, six months of home detention, two years of supervised release and $100 mandatory special assessment. - Michael Whitt (owner of Barnhill Management Group): Civil penalty of $60,000.
- Gary Lenz (former Peregrine President & COO): three years of probationProbationProbation literally means testing of behaviour or abilities. In a legal sense, an offender on probation is ordered to follow certain conditions set forth by the court, often under the supervision of a probation officer...
. - Ilse Cappel (former Peregrine Assistant Treasurer): Five years of probationProbationProbation literally means testing of behaviour or abilities. In a legal sense, an offender on probation is ordered to follow certain conditions set forth by the court, often under the supervision of a probation officer...
. - John Burnham Benjamin (former Peregrine Treasurer): Five years of probation.
- Peter O'Brien (former Peregrine Director of Alliances): One year of probation.
Charges dismissed:
- Joseph Reichner (former Peregrine Vice President of Alliances)
- Patrick Towle (former Peregrine Revenue accounting manager)
- Dan Stulac (formerly led auditing team at Arthur AndersenArthur AndersenArthur Andersen LLP, based in Chicago, was once one of the "Big Five" accounting firms among PricewaterhouseCoopers, Deloitte Touche Tohmatsu, Ernst & Young and KPMG, providing auditing, tax, and consulting services to large corporations...
) - Eric Paul Deller (former Peregrine General Counsel)
Bankruptcy
Peregrine filed for Chapter 11Chapter 11, Title 11, United States Code
Chapter 11 is a chapter of the United States Bankruptcy Code, which permits reorganization under the bankruptcy laws of the United States. Chapter 11 bankruptcy is available to every business, whether organized as a corporation or sole proprietorship, and to individuals, although it is most...
protection on September 23, 2002 after laying off 1400 employees, or nearly half its workforce.. When Peregrine filed for federal bankruptcy protection and eventually canceled its common stocks, more than $4 billion in shareholder equity was lost. After filing, the company sold the Remedy
Remedy Corp
Remedy Corp was a software company that produced the Action Request System and various applications therein. Remedy is now the Service Management Business Unit of BMC Software.-History:...
division of the company to BMC Software
BMC Software
BMC Software, Inc. is a multinational corporation specializing in Business Service Management software, with record annual revenue in fiscal 2009 of $1.87 billion...
for more than $300 million dollars. Peregrine exited Chapter 11 reorganization in August 2003, and the president and CEO, Gary Greenfield, left the company. Retired software executive John Mutch became president and CEO in August 2003.
Sale to HP
Hewlett Packard acquired Peregrine Systems in 2005 for $425 million. The Peregrine products are now sold as part of the HP IT Management SoftwareHP IT Management Software
HP IT Management Software is a family of Enterprise software products sold by the HP Software Division of information technology company Hewlett-Packard...
(BTO) portfolio within the HP Software Division.
Products
- AssetCenter - IT Enterprise asset managementEnterprise Asset ManagementEnterprise asset management means the whole life optimal management of the physical assets of an organization to maximize value. It covers such things as the design, construction, commissioning, operations, maintenance and decommissioning/replacement of plant, equipment and facilities...
software (acquired from Apsylog). It is now sold as HP AssetCenter software. - ServiceCenter - ITILItilItil may mean:*Atil or Itil, the ancient capital of Khazaria*Itil , also Idel, Atil, Atal, the ancient and modern Turkic name of the river Volga.ITIL can stand for:*Information Technology Infrastructure Library...
-enabled IT service managementIT Service ManagementIT service management is a discipline for managing information technology systems, philosophically centered on the customer's perspective of IT's contribution to the business. ITSM stands in deliberate contrast to technology-centered approaches to IT management and business interaction...
software (developed internally, flagship service management offering). It is now sold as HP Service Manager software. - Connect-It - Data integration tool. It is now sold as HP Connect-It software.
- Enterprise Discovery - Discovery and Inventory tool
- Knowlix - Knowledge management application (acquired from Knowlix)
- InfraCenter for Workgroups – Integrated asset and help desk management software.
- InfraTools – Software tools for infrastructure management.
- Get-Services - Web based application that lets employees create and manage change requests.
- Get-Resources (Get.Resources!) - Web- based application providing that lets employees request IT resources from a predefined catalog of items with automatic routing to the service desk.
- Get-Answers - Web based knowledge management application (acquired from Knowlix).
- Get-IT (Get.IT!) – Employee self-procurement software.
- FacilityCenter - Computer-Aided Facilities Management (CAFM) product divested to TRIRIGA during financial collapse (acquired from Innovative Tech Systems as Span FM).
- FacilityCenter Reserve - Room Booking system divested to TRIRIGA during financial collapse (acquired from Critical Path).
- Fleet Anywhere - Company vehicle fleet management software divested during to Maximus in 2002. (acquired from Prototype).
- Rail Anywhere – Advanced and light rail management software for passenger and freight rail industries (acquired from based on software developed by KKO and applied to the Fleet Anywhere technology). (acquired from Prototype).
- Harbinger.Net - Supply chain enablement products sold to Golden Gate Capital during financial collapse (acquired from Harbinger). (acquired from Prototype).
- Extricity - e-commerce Business Process Management software sold to Golden Gate Capital in 2002 (acquired from Extricity)
- Remedy ARS (Action Request System) - Automated business process management and customer support software, sold to BMC in 2002. (acquired from Remedy Corp).
- TeleCenter – Software for managing telecommunications assets (acquired from Telco Research).
- TRU - Telecoms based product line, sold to Symphony Services Corp (acquired from Telco Research)
- Xanadu - IT infrastructure management appliance.
- Tivoli ServiceDesk - IT Service Management software, acquired from IBM.