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Dunn done at HP
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EE Times


SAN FRANCISCO — Succumbing to pressure from a spiraling controversy over a media leak investigation, Hewlett-Packard Co.'s embattled chairwoman abruptly resigned from the company's board Friday (Sept. 22).

Patricia Dunn stepped down as chairwoman earlier than expected. Dunn had said previously she would abandon the role of chair, but remain a member of the board, next January.

HP (Palo Alto, Calif.) appointed Mark Hurd, president CEO, chairman of the board. The company also appointed Richard Hackborn, a member of the board since 1992, lead director.

The shakeup follows more than two weeks of spiraling controversy over an HP investigation into board room leaks that utilized a technique called "pretexting" to fraudulently gain access to the phone records of journalists and HP board members. The technique, which is illegal in California, was allegedly used during a company investigation of leaks to the media by HP board members.

"I have resigned today at the request of the board," Dunn said through a statement. "The unauthorized disclosure of confidential information was a serious violation of our code of conduct."

Dunn said she followed the proper procedures by seeking the assistance of HP security personnel, but did not select the people who conducted the investigation. She said she was a subject of the investigation and that her phone records were examined along with others.

"Unfortunately, the people HP relied upon to conduct this type of investigation let me and the company down," Dunn said.

HP said it has appointed Bart Schwartz, a former U.S. prosecutor, to perform an independent review of investigative methods and the company's standards of business conduct processes, and to make future recommendations for implementing best practices.

"We have spent the past few weeks getting further clarity as to what happened in the investigation into the disclosure of unauthorized material from the board," Hurd said through a statement. "While this process is not yet complete, it is clear that inappropriate steps were taken in conducting this work."

According to an online report published the San Francisco Chronicle Friday, Hurd told journalists gathered at a Palo Alto news conference that he did not read a report on the investigation written by HP's internal investigators, but admitted that he knew there were plans to send false information to journalists.

The spiraling scandal has virtually remade the board of directors at one of the Silicon Valley's oldest and most respected companies. Former board members Tom Perkins and George Keyworth also resigned from HP's board over the pretexting scandal. Keyworth was reportedly asked to step down after being identified as the source of the board room leak, which originally involved a division among board members over then-CEO Carly Fiorina.

A Congressional committee with jurisdiction over telecommunications issues said last week it would hold a hearing on the pretexting scandal on Sept. 28. The committee said it would invite Dunn and HP general counsel Ann Baskins, as well as an executive from Security Outsourcing Solutions Inc., the HP subcontractor at the center of the scandal, to testify.

Dunn said Friday that she looks forward to testifying before the Congressional panel.

California's attorney general said last week that he has enough evidence related to the scandal to indict HP executives.

The Washington Post reported Thursday that Hurd allegedly approved a "sting" operation in February while the company was attempting to stop leaks to the media. The operation was launched after board members were suspected of leaking sensitive company information to several news organizations, including CNET and the Wall Street Journal. The Post reported that Hurd's involvement in the leak probe was uncovered in an e-mail message to Dunn.

"I wish to apologize both personally and on behalf of HP to each of those who were affected," Hurd said in the Friday statement. "We believe these unacceptable measures were isolated instances that do not reflect the broader behavior and values of HP, its employees or its board. But they cannot occur here again. Our actions today are intended to ensure that they never do."



Related Links:

  • HP used 'inappropriate techniques,' Hurd says



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