Memo suggests HP's Hurd knew of probe in July 2005-WSJ
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Hewlett-Packard Co.  Chief  Executive Mark Hurd may have known as early as in July 2005 the  company was looking into private phone records as part of its  leak investigation, The Wall Street Journal reported in its  online edition on Monday.
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Revelations that HP supervised an extensive investigation of some of its directors, journalists and a few employees have blemished its reputation. The New York Times
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(InfoWorld) - Hewlett-Packard board members and journalists were under physical surveillance by investigators trying to find out who was providing information to reporters, and private investigators tried to put tracking software on a journalist's computer to keep tabs on e-mail, according to a New York Times report. Patricia Dunn, HP's chairman, the company's general counsel and a staff attorney oversaw the internalÂ investigation of news leaks, the Times reported, citing anonymous sources who have been briefed on HP's findings so far regarding the secret investigation. It isn't clear how much involvement in the investigation there was by Dunn and others at HP, the Times reported Monday. HP announced last week that Dunn willÂ step aside as chairmanÂ in January, although she will remain as a director. Two others also have resigned from the board in the wake of the scandal. Over the weekend, HP identified Michael Moeller, director of corporate media relations, as one of two HP employees who was targeted in the internal investigation. "Investigators' suspicions were misdirected and unfounded," Robert Sherbin, HP's vice president for external communications was quoted as telling the Times on Sunday. The internal investigation reportedly was conducted in two stages, with the first from January 2005 to August of that year, which came up with nothing to go on, and then a second phase beginning in January 2006 after the technology news site of CNET NetworksÂ posted an article about an HP senior management meeting held that month. The board first clamored for an investigation into leaks of information to journalists in January 2005 following an article in The Wall Street Journal that spoke of board discussions regarding management reorganization and changes in the responsibilities to be handled by Carly Fiorina, who was then chief executive officer and chairman. She was ousted by the board in February 2005. Within days of that board action, The New York Times published a detailed account of a directors' meeting that was crucial to her ouster. Reporters from the Times, the Journal, CNET and Business Week have been informed by the California attorney general's office that HP investigated them. California and federal authorities are investigating HP's conduct and the California attorney general has said that charges are likely. HP has admitted that its the private investigative firm it hired used "pretexting," with investigators pretending to be journalists in order to obtain their personal telephone records. Even after a summary of the internal investigation was presented to leaders at HP, in Palo Alto, California, those in charge were unaware that possibly illegal methods had been used to obtain information, the Times reported. In May, the investigation's findings were relayed to the board of directors, including the allegation that its longest-running member, George Keyworth, was the source of the leaks to journalists. He refused to resign, but Vice Chairman Thomas Perkins, an influential and important Silicon Valley venture capitalist, was incensed over the probe and quit the board. He then turned his attention to pressuring Dunn to resign. His surprising departure was announced in a mildly worded HP statement that offered no clue as to the fractious nature of what had transpired, details of which began to emerge in news accounts earlier this month.
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(InfoWorld) - A U.S. House of Representatives Subcommittee probing theÂ Hewlett-Packard Co. (HP) pretexting case has issued more subpoenas to compel witness testimony at a Thursday hearing. The Subcommittee on Oversight and Investigations of the Energy and Commerce Committee issued subpoenas Wednesday for five people identified as "pretexters," data brokers who sometimes obtain access to confidential records under false pretenses. HP has been embroiled in a scandal over its hiring of private investigators who engaged in possibly illegal pretexting to investigate news leaks from HP's board to reporters. Served with subpoenas, according to the Subcommittee, are: Bryan Wagner, a private investigator from Littleton, Colorado; Charles Kelly, of the CAS Agency in Villa Rica, Georgia; Cassandra Selvage of Eye in the Sky Investigations, of Dade City, Florida; Darren Brost, of Austin, Texas; and Valerie Preston from InSearchOf Inc., of Cooper City, Florida. Wagner was identified in a Wednesday Wall Street Journal article as a suspect in the pretexting of phone records of HP directors, employees and journalists who cover the Palo Alto, California technology company. The Journal reported that Wagner told an investigator that he smashed his computer to pieces with a hammer, destroying data that was saved on it. The article also said that the destruction of the computer may hamper an investigation by California Attorney General Bill Lockyer's office into possible illegal activity by people at HP or by the private investigators HP hired. The five who were subpoenaed Wednesday have been added to a list of witnesses that also includes HP's Chief Executive Officer and President Mark Hurd and former board chairman Patricia Dunn, who resigned last Friday because of the scandal. While Dunn and Hurd have volunteered to appear, two other HP executives involved in the investigation were subpoenaed: senior counsel Kevin Hunsaker and Global Security Manager Anthony Gentilucci. Hunsaker "left the company" and Gentilucci "resigned" effective Tuesday, said HP spokesman Ryan Donovan. Also subpoenaed are Ron DeLia, operator of Security Outsourcing Solutions Inc., a Needham, Massachusetts, private investigations firm, and Joe Depante, owner of Action Research Group, of Melbourne, Florida. HP has acknowledged hiring both those firms in its leak investigation and that they used pretexting to track down personal phone records. Â
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PALO ALTO, California  - Hewlett-Packard Co. Chief   Executive Officer Mark Hurd said he had approved an e-mail ruse   to track down boardroom leaks, admitting for the first time his   involvement in a scandal that also on Friday forced out the   company's chairman.
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Hewlett-Packard Co. HPQ.N Chief   Executive Mark Hurd told lawmakers on Thursday there were no   excuses for a probe of boardroom leaks that led investigators   to obtain private telephone records deceptively.
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New reports implicate HP chief more deeply than previously thought.
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(InfoWorld) - IT investors had a mixed bag of news to digest this week, in the wake of Hewlett-Packard Co.'s boardroom spy scandal, and Xerox Corp.'s annual pilgrimage to New York to woo the Wall Street crowd. It's a measure of HP Chief Executive Officer Mark Hurd's success so far that the company has not been harder hit by theÂ boardroom spy scandal, in which outside investigators hired by the board used allegedly illegal means to spy on employees, board members and reporters. In order to smooth things over, Hurd will replace Dunn in January and retain his CEO title. The spying was sparked by leaks to the press, which ironically included information on discussions that led to the firing of former CEO Carly Fiorina. It's ironic because under Hurd, the company's takeover of Compaq Computer Corp. -- a controversial acquisition engineered by Fiorina -- seems to be paying off. Hurd has reorganized the company to cut costs, and HP is gaining PC market share and growing almost as fast as its archrival in that market, Dell Inc. Since HP is much larger than Dell, that growth is remarkable. Much of it is the result of reorganized company logistics, supply-chain management, inventory control, as well as a continued push on the product front. The spy scandal has not implicated Hurd, and that's a good thing. Company shares did take a hit after Tuesday's disclosure by the California state attorney general on The NewsHour with Jim Lehrer that he had enough evidence to charge HP officials. Still, shares (HPQ) closed Thursday at $36.25, about where they were right before the scandal broke last week. The share price is still up 3.12 percent for the month and 31.81 percent for the year. As long as Hurd is not implicated in the scandal, the company seems poised to continue its run, even if Dunn or other board members are indicted. Of the seven major brokers changing their recommendations on the company this year, all but one have been to upgrade their recommendations -- the one exception was before the scandal. Meanwhile, HP's archrival in printers, Xerox, is having a hard time gaining traction in the market. The company made its annual pitch to Wall Street last week in a series of product and services rollouts. The consensus among analysts appears to be that CEO Anne Mulcahy is making all the right moves: slimming down the company, integrating and expanding services, keeping up pressure on rivals in the small and medium-size business market, and keeping its lead on the high-end production market. But share price was not affected by her pitch to Wall Street. Shares (XRX) closed Thursday right where they were on the last day of her pitch last Friday, at $14.90. "The strategy is there, but Wall Street wants to see more growth," noted IDC analyst Keith Kmetz. Various competitors including Asian manufacturers have "nibbled away" at the low end of the market, Kmetz said, but Xerox still has a command position in the production market and is strong in the market for office color printing and multifunction devices. Only HP can claim to rival Xerox in the full scope of products and services. But growth is tepid. Xerox second quarter revenue rose to $3.98 billion from $3.92 billion last year. The message from company executives appears to that Xerox will be able to achieve growth rates experienced by HP as services grow nearer to 50 percent of company revenue. But as Mulcahy told IDG, "whether that will be in three, or five years, I can't say."
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(InfoWorld) - Although Hewlett-Packard's spying scandal has led to the resignation of four high-ranking officials and evoked comparisons in Congress to Watergate and fraud at Enron, it isn't likely to impede the company's long-term ability to compete, analysts and investors said. So far, these groups said, there has been scant evidence linking Mark Hurd to the legally questionable practice of pretexting, in which investigators probing news leaks impersonated board members and journalists in order to obtain their phone records. So long as Hurd is not shown to have approved or participated in those activities, HP is likely to emerge with its viability intact. "The problem has obviously been recognized and is being rectified, and with time the business will build back to normal," said Alex Vallecillo, a portfolio manager who follows technology stocks at Allegiant Asset Management. "We're all big boys and girls, and we understand what goes on in the corporate boardroom has no effect on the ability of [HP's] products and services to deliver value." Indeed, HP's shares gained 1.6 percent on Thursday, the same day Patricia Dunn, who was forced to resign as the company's chairman last week, was grilled before a hearing convened by the House Energy and Commerce Committee. Ten people involved with the investigation asserted their Fifth Amendment rights in declining to answer representatives' questions. Since Sept. 5, the day before the news of the scandal broke, HP shares have fallen 1.1 percent, compared with a 2.9 percent gain for the Nasdaq composite index and a 2.1 percent gain for the Dow Jones Industrial Average. Although the negative attention has been a distraction for HP, "that's a very short-term situation, which I expect to pass soon," said Sunil Reddy, senior portfolio manager at Fifth Third Asset Management. "All the cards are on the table right now; I'd be very surprised if anything new comes out." Analyst Rob Enderle of the Enderle Group, attending an event in New York where HP was showing off new PCs ahead of the Christmas shopping season, agreed. The corporate buyers he's talked to aren't likely to choose HP competitors as a result of the scandal, and he said he expected non-business customers to feel the same way. "It relates to behavior of folks the average consumer doesn't relate with and probably doesn't understand." That said, HP's investigative techniques have become the butt of plenty of jokes, Enderle said, in which business customers tell HP sales staff: "We're probably going to send this out to bid, but you probably already know that because you've been looking at my phone records."
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By Pete Carey and Therese Poletti, San Jose Mercury News, Calif.  Sep. 21--As the uproar has grown over Hewlett-Packard's investigation of  boardroom leaks, there has been an island of silence surrounding HP's chief  executive, Mark Hurd.
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Former HP chief Carly Fiorina ordered the first leak investigation in January 2005, she says in her memoir. The New York Times
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SAN FRANCISCO -- Investigators for Hewlett-Packard Co. sought private telephone records of board members while trying to figure out which director leaked confidential company information to the media, the computer maker disclosed in a regulatory filing Wednesday.
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Hewlett-Packard Co. HPQ.N is   under investigation by U.S. federal prosecutors over its   inquiry into boardroom leaks to the press, authorities said on   Monday, adding to the computer maker's legal woes.
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(InfoWorld) - Hewlett-Packard Chief Executive Officer Mark Hurd knew of plans for a disinformation campaign designed to find the source ofÂ leaks from boardroom discussions, The Washington Post reported Thursday. The report implicates Hurd more deeply in the scandal than was previously believed. The HP CEO and President is set toÂ replace Patricia DunnÂ as chairman of the company's board of directors in January. Dunn said she would step down Sept. 12 as the result of an internal investigation into practices used to find the source of news leaks about matters discussed by the board. The disinformation campaign was designed to uncover the source of the leaks by creating a phony HP insider who would gain the trust of a reporter, feed her false information, and in the process place a software tracer on her e-mail using an attachment, according to e-mails obtained by the Post. The nonexistent insider's persona was created by HP Senior Counsel Kevin Hunsaker and an unnamed HP colleague of Hunsaker's in Boston, it said. None of the e-mails are from or to Hurd, but refer to his knowledge or approval of various actions, the report said. The Post did not say how it obtained the "more than two dozen" e-mails. HP declined to comment or to make Hurd available for an interview. Some of the e-mails were sent by Dunn, such as a Feb. 9 e-mail to Hunsaker and HP's General Counsel Ann O. Baskins. Dunn wrote, "I spoke with Mark and he is on board with the plan to use the info on new handheld [device]," the report said. The company had planned to feed the journalist information about an upcoming handheld product to help tease out the source of the leaks, the Post said. In a Feb. 22 e-mail to Hunsaker, Dunn wrote, "Kevin, I think this is very clever. As a matter of course anything that is going to potentially be seen outside HP should have Mark's approval as well," the report said. Dunn is referring to a slide of phony products Hunsaker had created to pass off to the reporter as inside information. Hunsaker sent an e-mail to Dunn on Feb. 23, stating, "FYI, I spoke to Mark a few minutes ago and he is fine with both the concept and the content," the report said. The Wall Street Journal also reported Thursday that it had seen internal HP emails suggesting that Hurd was closer to the leaks investigation than had previously been thought. HP's investigation into the leaks, and potential illegal conduct that may have occurred as part of it, will be the subject ofÂ House Subcommittee meetingÂ Sept. 28. Dunn and others areÂ scheduled to testifyÂ voluntarily regarding their role in and knowledge of the investigation and its methods. An outside private investigation firm hired by HP to look into the boardroom leaks may haveÂ illegally obtained the phone recordsÂ of HP employees, nine journalists who had written about the company, and some of its own board members. The use of a technique called pretexting, in which people disguise their identity in order to obtain private information about others, is at issue. So far the scandal has led to the resignation of two HP board members, along with Dunn saying she will step down as chairman in January.
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By Paul Elias Associated Press  SAN FRANCISCO -- The one winner in the Hewlett-Packard Co. boardroom spying scandal that has enthralled Silicon Valley appears to be Mark Hurd.
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By JORDAN ROBERTSON  SAN FRANCISCO - The congressional panel investigating Hewlett-Packard Co.'s boardroom spying probe has demanded that CEO Mark Hurd explain $1.37 million worth of options he exercised just before the scandal became public, two congressmen said Wednesday.
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Hewlett-Packard has turned over thousands of documents to a U.S. House subcommittee investigating methods the company used to find out who was leaking company information to the media, a subcommittee spokesman said Monday.