HP Execs Asked to Testify in Washington
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By JORDAN ROBERTSON  SAN JOSE, Calif. - A congressional panel wants to question key figures in the scandal surrounding Hewlett-Packard Co.'s investigation of media leaks, while a shareholder lawsuit was filed in state court accusing the company's top brass of breaching their duties.
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Hewlett-Packard Co.'s CEO, Mark Hurd, and former board chairman Patricia Dunn this morning faced an angry congressional subcommittee looking into the legality of efforts by HP to plug boardroom leaks.
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(InfoWorld) - The U.S. Department of Justice is asking questions about conduct by Hewlett-Packard Co. that has embroiled the technology company in controversy. HP acknowledged in a U.S. Securities and Exchange Commission filing Monday that it isÂ cooperating with an inquiryÂ by the U.S. Attorney for the Northern District of California intoÂ possibly illegal tactics used by investigators hired by HP to investigate news leaks from the company's board members. HP described the U.S. Attorney's inquiry as "informal" and said the questions are similar to those asked by the attorney general of California. HP is based in Palo Alto, California. "We are cooperating fully with these inquiries," HP said in its SEC filing. The probes are looking into the use of "pretexting" to search phone records to determine which board members may have been talking to reporters. The phone records of nine reporters from various news organizations were also obtained to determine who their sources from within HP might have been on stories about the company. Pretexting refers to posing as a phone company customer to get access to personal records. California Attorney General Bill Lockyer says a crime was committed in connection with the pretexting, but his office is still investigating what crime and by whom. The scandal has brought pressure on HP Chairman Patricia Dunn, who ordered the investigation, but claims she didn't know the outside investigative firm hired to trace the leaks would engage in pretexting. HP's board is meeting Monday for the second straight day to discuss its response to the controversy. Former HP director Thomas Perkins, who quit in protest in May because of the way the investigation was conducted, called on Dunn to resign. His statement, released Saturday by his attorney, was prompted by Dunn's comments in media interviews last week in which she alleged that it was Perkins who wanted "more aggressive measures" used to investigate the leaks, including use of lie detectors on board members. "I am saddened, but not surprised, that Patricia Dunn has attacked me personally for doing my job. I acted not from any ill will toward Ms. Dunn but to protect the best interests of HP. I think the past months and days have shown that those interests are best served if Ms. Dunn would resign from the board," said Jenkins in his statement. The U.S. Federal Communications Commission also is investigating HP. The FCC reportedly sent a "letter of inquiry" to AT&T Inc. asking how its customer phone records may have been accessed, according to an Associated Press report. An FCC spokesman could not confirm that. HP's internal probe identified director George Keyworth as the source for a CNet Networks Inc. story about HP's strategy, which the technology news Web site posted in January. He refused to resign when asked to doÂ so by Dunn in May, but theÂ board has since voted not to renominate him to his seat. Â
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World + dog joins in The FBI, a House of Representatives committee, and the US Attorney General for northern California are all now investigating HP. They join the Securities and Exchange Commission, which is looking at how HP told the markets about the resignation of director Tom Perkins.â¦
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The congressional panel investigating Hewlett-Packard Co.'s internal probe of its boardroom spying has demanded that chief executive Mark Hurd explain $1.37 million worth of options he exercised just before the scandal became public, two congressmen said yesterday.
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U.S. legislators signalled Thursday that they will hold Hewlett-Packard's feet to the fire during House testimony on the company'sÂ pretexting scandal, while former General Counsel Ann Baskins formally declined to answer any questions by invoking her Fifth Amendment right to avoid self-incrimination.
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The U.S. Department of Justice is asking questions about conduct by Hewlett-Packard Co. that has embroiled the technology company in controversy.
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(InfoWorld) - A shareholder lawsuit against Hewlett-Packard (HP) forÂ attempting to spy on board members and reportersÂ has been expanded to include charges of insider stock trading. An amended complaint filed Wednesday in the Superior Court of California for Santa Clara County accuses HP Chairman and Chief Executive Officer Mark Hurd and seven other company executives of selling $41.3 million worth of HP stock at "inflated prices" shortly before the company revealed that its investigators had used questionable and possibly illegal techniques to gain access to personal records such as phone call logs. The eight executives sold 1.7 million shares of stock between Aug. 21 and Sept. 6, according to the lawsuit. In an Aug. 31 filing with the U.S. Securities and Exchange Commission (SEC), HP said an outside investigator used the practice of pretexting, pretending to be someone else, to gain access to personal records. Former HP Chairman Patricia Dunn and four others face criminal charges stemming from their alleged participation in the spying, which also used e-mail tracer technology, according to testimony before a U.S. congressional committee. HP also tried to prop up the value of its stock price by announcing on Aug. 21 it would repurchase $6 billion worth of its stock, the lawsuit says. "In the midst of this acrimony HP executives cashed in," says the complaint, filed by the Lerach, Coughlin, Stoia, Geller, Rudman & Robbins LLP law firm. HP issued a statement calling the lawsuit "baseless." The lawsuit "represents a transparent effort to exploit issues related to HP's recent investigation for personal gain at the expense of HP, its shareholders and its employees," the statement said. "HP will defend itself vigorously." HP acknowledged that it had obtained the phone records of 12 people by using pretexting. The stockholder lawsuit, originally filed in September, asks the court to declare that HP's executives have "committed breaches of their fiduciary duties" and to order executives to repay the amount the company has been damaged by the spying scandal. The lawsuit also asks the court to require HP to reform its corporate governance and to extract punitive damages from Dunn, Hurd and other HP executives.
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(InfoWorld) - Hewlett-Packard Co. Chairman Patricia Dunn will answer questions on the spying scandal that has embroiled her company during a House committee hearing on Capitol Hill next week. HP's general counsel, Ann Baskins, will also appear at the hearing of the Subcommittee on Oversight and Investigations of the House Committee on Energy and Commerce, being held next Thursday, said HP spokesman Ryan Donovan. HP's lead outside counsel, Larry Sonsini of the Palo Alto law firm Wilson, Sonsini, Goodrich & Rosati, will also testify, according to Terry Lane, a committee spokesman. Sonsini advised HP on the legality of its investigation into media leaks of details from the company's board meetings between 2005 and 2006. Earlier this month, HP revealed it had hired outside investigators to find the leaker and that they had impersonated the subjects of their investigation in order to gain access to private telephone records. In the course of the search, HP board members and reporters were impersonated. The committee is looking into HP's methods and is considering new federal legislation that would make this practice, called 'pretexting,' illegal. HP is also being investigated by the Attorneys General of California and Massachusetts, the U.S. Federal Bureau of Investigation and the U.S. Attorney's office. Ronald DeLia of investigation firm Security Outsourcing Solutions is also set to appear, but Lane said it is possible he will invoke his Fifth Amendment right to not testify to protect against self-incrimination. Prosecutors reportedly are looking into DeLia's company and a Melbourne, Florida, investigation company, Action Research Group, in connection with the scandal. In a June 11 Congressional hearing on pretexting, several investigators invoked their Fifth Amendment rights and refused to answer questions on the practice, which is considered to be in a legal gray area. The committee has also asked HP Global Security Manager Anthony Gentilucci and Action Research Group owner Joe Depante to testify, but has not heard back from them, Lane said. HP has already provided the committee with "thousands of pages of documents" in connection with its investigation, Lane said. The pretexting scandal has been front page news for several weeks now and has forced Dunn to step down from her chairman's role, effective January. But it has not had much of an effect on the company's financial performance. HP's (HPQ) stock has hovered in the $36 range since news of the affair first broke three weeks ago. HP Executive Vice President Vyomesh Joshi, who runs the company's printing business, downplayed the effect that the scandal was having on HP's management. "I think our focus is business," he said in response to a question on the matter at the Bank of America's Annual Investment Conference in San Francisco Tuesday. "We have a very solid team who is focusing on the business, focusing on the execution. At the end of the day, that is what we want to do." Â
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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.
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The U.S. House Energy and Commerce   Committee said on Wednesday that it subpoenaed five private   investigators to testify at the Hewlett-Packard Co. HPQ.N   data privacy hearing on Thursday.
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A former Hewlett-Packard Co.   HPQ.N board member has asked U.S. prosecutors, as well as   U.S. trade and communications regulators, to review an HP   investigation in which directors' and journalists' private   phone records were accessed.
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(InfoWorld) - Like a good friend who has just gotten out of a terrible relationship, Hewlett-Packard seemed to be on the rebound and all the happier for it in recent months. After the departure of controversial CEO Carly Fiorina, the company has as of late shown newfound confidence and focus under new CEO Mark Hurd. But allâs still not well in the higher echelons of HP, as revealed in a filing the company made to the U.S. Securities and Exchange Commission. The sudden and unexpected resignation of Silicon Valley venture capitalist Thomas Perkins from HPâs board of directors in May turned into a full-blown scandal last week, spawning law enforcement and SEC investigations and a PR nightmare for HP. At the center of the controversy is a legally and ethically questionable internal investigation of leaks of confidential company information to the media dating back to 2005. According to a copy of a letter from Perkins to the HP board explaining his sudden resignation, and republished on thesmokinggun.comâs Web site (a sure sign, if ever there was one, that youâre in the PR doghouse), HP hired outside companies to obtain personal phone records of board members using âpretextingâ (thatâs âsocial engineeringâ to you and me), in which a private investigator impersonated board members to obtain details of private phone company billing statements. In his letter, Perkins says he has proof that his own phone records were âhackedâ in the investigation. Those investigations ultimately fingered George Keyworth, an HP director since 1986, as the source of information about board deliberations and other confidential information, which were leaked to the media without authorization. Keyworth acknowledged he had leaked information at a board meeting on May 18 but refused the boardâs request to step down. Perkins announced his own resignation at that meeting, citing âpersonal frustrationâ with board Chairwoman Patricia Dunn over the handling of the leak investigation. In the meantime, the dispute has spilled over into the public domain. The attorney general of California asked HP to supply information about the leak investigation. The SEC has also been in touch over the 8-K filing HP made when Perkins resigned. HP believes its disclosures in May were âaccurate and complete.â In an Aug. 31 meeting, HPâs board of directors determined that Keyworth shouldnât be nominated for another term on the board.
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The House Energy and Commerce Committee on Friday expanded its probe into the Hewlett-Packard press leak scandal by asking several people involved to testify at a hearing on the matter scheduled for September 28.
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(InfoWorld) - In one of his first public acts to address the burgeoning Hewlett-Packard Co. (HP) spy scandal, Chief Executive Officer Mark Hurd plans to brief reporters Friday about the findings of an analysis conducted by the company's law firm. HP retained Morgan, Lewis & Bockius for the outside analysis of the company's actions in trying to find the source of a boardroom news leak. The scandal led toÂ the resignation of company Chairman Patricia Dunn, who will turn over that job to Hurd in January. Dunn and Hurd have said they knew about the operation, but insist they never approved of the possible illegal methods used by third-party investigators to obtain communications records of reporters and some HP employees and directors. "What began as an effort to prevent the leaks of confidential information from HP's board room ended up heading in directions that were never anticipated," Hurd said in a written statement. However, company e-mail records seem to indicate that both executives knew about the investigators' "pretexting" practices while they were going on, according toÂ recent stories in the Wall Street Journal and The New York Times. Pretexting involves pretending to be someone to obtain their telephone records. In Friday's meeting, a representative from the law firm will share its findings, describing "exactly what took place and when," Hurd said. Dunn has also saidÂ she will share more information about the episode, promising to "set the record straight" about allegations that she oversaw the illegal operation. Morgan Lewis will also represent the company in government inquiries such as criminal investigations by the California and Massachusetts attorneys general, and by the U.S. House of Representatives. California Attorney General Bill Lockyer has said that he has enough evidence to indict certain people at HP and its contractors with crimes related to their methods in obtaining private phone records of reporters, board members and other employees. Â
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Hewlett-Packard Co. HPQ.N said   on Monday it has been contacted by U.S. federal prosecutors   seeking information about the company's investigation into   boardroom leaks to the press.
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A House of Representatives panel on  Wednesday extended its probe into Hewlett-Packard Co.'s use of  private telephone records by subpoenaing five private  investigators to testify at a Thursday hearing.