House Panel Pursues Key Figures at HP
A congressional panel wants to question key figures in the scandal surrounding Hewlett-Packard Co.’s investigation of media leaks, and a shareholder lawsuit was filed in state court accusing the company’s top brass of breaching their duties.
The House Energy and Commerce Committee sent letters Friday requesting that HP Chairwoman Patricia C. Dunn and General Counsel Ann O. Baskins appear at a Sept. 28 hearing of its oversight and investigations subcommittee.
HP spokesman Mike Moeller declined to say whether either would testify.
“HP is fully cooperating with all ongoing investigations and inquiries, including the one being conducted by the House subcommittee,” he said.
Silicon Valley attorney Larry Sonsini, who served as an outside legal advisor to HP during its investigation, was also asked to appear, as was Ronald DeLia, who runs a Boston-area private investigation firm that was hired by HP to conduct the probe.
Calls to Sonsini and DeLia were not immediately returned.
The congressional panel has been conducting an inquiry into “pretexting,” the practice of impersonating people to access their personal information.
Dunn has acknowledged that she authorized the probe, in which private investigators hired by HP used Social Security numbers and other personal information to pose as company directors, employees and journalists to gain access to logs of their home and cellular phone calls.
The probe resulted in the resignation of two HP directors and the demotion of a third. George A. Keyworth II quit the board after acknowledging he was a source of the leaks. Thomas Perkins stormed out of a May 18 board meeting in protest of the investigators’ tactics. Dunn will step down as chairwoman in January and be replaced by HP Chief Executive Mark Hurd.
As HP’s staff attorney, Baskins allegedly oversaw the leak investigation and declared it to be legal.
HP insiders and contractors are likely to invoke their 5th Amendment right against self-incrimination rather than testify before Congress and possibly expose themselves to criminal charges, one legal expert said.
“Though the appearance will be gruesome ... to do otherwise might not be prudent,” said Ed Harmon, a partner with Thorp Reed & Armstrong in Pittsburgh.
The lawsuit was filed Thursday in Santa Clara County Superior Court by Juliet Worsham on behalf of all HP shareholders. It alleges “substantial expense and damage” to the company from the investigators’ use of pretexting and seeks to have Dunn, Baskins, Hurd, DeLia and several members of the HP board found to have breached their fiduciary duties and abused their power.
It asks for the defendants to reimburse Hewlett-Packard for any financial damage suffered by shareholders as a result of the pretexting scandal and to “reform and improve its corporate governance and internal control procedures.”
HP spokesman Moeller declined to comment on the suit.
California Atty. Gen. Bill Lockyer has said HP insiders and the outside investigators are likely to face criminal charges tied to the pretexting scandal. The FBI and the U.S. attorney for the Northern District of California are also investigating, as are the Securities and Exchange Commission and the Federal Communications Commission.
Also Friday, Carly Fiorina, ousted as HP’s CEO last year, steered clear of the scandal during a speaking engagement at Babson College in Wellesley, Mass. An audience member asked her how she would handle the controversy if she were Dunn, but Fiorina declined to answer.
HP’s stock, which has been all but immune to the boardroom scandal, fell 7 cents to $36.18.
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The Associated Press and Bloomberg News were used in compiling this report.
