HP Boardroom Brawl

[pchang]

Knife work?

Or maybe acting ethically is its own reward.

[DanS]

The original WSJ article painted it more as a power squabble in the board room. Keyworth was Perkins' man and Perkins went to the ground for him.

If you look at it this way, Perkins was merely twisting the knife while appearing high-minded.

It's still unclear to me whether Perkins made the ethics charge at the board meeting before quitting.

[Asher]

Fact: Women can't run a company.

[pchang]

Avon's Ceo



She can run my company any time

[One_more_turn]

It's pretty obvious that Patricia Dunn made a power grab, but shot herself in the foot instead. She wanted to use this 'leak investigation' to oust existing board members and replace them with her cronies. But the other side was not stupid and might have even set a trap. I think Dunn's days at HP are numbered. She will ruthlessly rushed out the door like Carly.

[DanS]

Dunn is toast, but she's trying to hold on to her directorship. Furthermore, the CEO is stepping in as chairman. Keyworth resigned.

I wonder how long it will take for this proposal to unravel. Further, I'm wondering why Keyworth resigned, when he hasn't resigned up to now?

Hurd to Take Over as H-P Chairman
A WALL STREET JOURNAL ONLINE NEWS ROUNDUP
September 12, 2006 12:00 p.m.

Hewlett-Packard Co. said Chief Executive Mark Hurd will take over as the company's chairman in January, replacing Patricia Dunn, who came under fire for the tactics used to investigate boardroom leaks.

Ms. Dunn will continue to serve as an H-P director and Mr. Hurd will continue in his roles as CEO and president of the computer giant. Richard Hackborn, a former H-P executive who has served on the board since 1992, has been named "lead independent director," effective in January.

George Keyworth II, a longtime H-P director who was fingered for leaking information to the press in the controversial investigation launched last year, is expected to resign as part of H-P's housecleaning, according to people familiar with the situation. Mr. Keyworth, who served as presidential science adviser in the Reagan White House, has served on H-P's board since 1986.

"I am taking action to ensure that inappropriate investigative techniques will not be employed again," Mr. Hurd said in a press release. "They have no place in H-P."

Ms. Dunn, who has been H-P's chairman since February 2005 and requested an investigation into media leaks, apologized for the techniques used in the company's probe, which included "pretexting" in which private investigators impersonated board members and nine journalists to acquire their private phone records.

"Unfortunately, the investigation, which was conducted with third parties, included certain inappropriate techniques. These went beyond what we understood them to be, and I apologize that they were employed,'' Ms. Dunn said in a statement.

Mr. Keyworth, a protégé of H-P's late co-founder David Packard, is by far the longest-serving director on H-P's board. After the results of Ms. Dunn's leak investigation were presented to H-P's board in May, the directors asked Mr. Keyworth to resign, but he refused. At that board meeting, Mr. Keyworth's friend, venture capitalist Thomas Perkins, resigned his board seat in protest over the leak investigation.

H-P General Counsel Ann Baskins, whose office oversaw the investigation, was not mentioned in the company's press release. "She remains employed by the company as general counsel," an H-P spokesman said Tuesday.
[George Keyworth II]

The pressure on Ms. Dunn to step down began rising sharply on Monday when Congress and federal investigators entered the fray.

A spokesman for the U.S. Attorney's Office for the Northern District of California yesterday confirmed that his office and the Federal Bureau of Investigation are probing the "processes employed" in the H-P leak investigation. Separately, a House committee said it is seeking information from H-P about the matter, including the identity of private investigators that H-P has said it used in the investigation.

The Palo Alto, Calif., computer and printer maker has disclosed that it hired a private-investigation firm to carry out the inquiry and the firm, still unidentified, hired a second firm that used pretexting to obtain phone records. Ms. Dunn has said she knew directors' phone records were being scrutinized, but didn't realize those records had been obtained improperly.

California Attorney General Bill Lockyer has said a crime was likely committed in the H-P probe, although his office has yet to determine who committed it. A spokesman for Mr. Lockyer's office yesterday said two potential felonies could be involved -- illegally accessing and using computer data and accessing personal-identification information and using it for illegal purposes, such as illegally accessing computer data.

Each of those crimes carries a maximum of three years in prison and a $10,000 fine. A person could be charged with multiple counts of the same crime, which presumably could happen because numerous individuals had their private records accessed.
[Mark Hurd]

The state agency could bring civil suits against individuals. The spokesman said there were various possible statutes under which to bring such actions. For instance, someone could be charged with unlawful business practices. Each violation of that statute carries a $2,500 fine.

FBI Deputy Director John Pistole told the Associated Press that the bureau opened its probe yesterday and was investigating two possible crimes: illegal computer intrusion and wiretapping. Under federal law, improperly obtaining personal phone records could be seen as a violation of the Federal Trade Commission Act, which attempts to protect consumer information. Regulations of the Federal Communications Commission require companies to keep customer information private.

But federal law may not be completely clear.

Late Friday, leaders of the House Judiciary Committee sent a letter to Senate Majority Leader Bill Frist urging him to move legislation stalled in the Senate that would make pretexting a federal crime. That legislation passed the House in April although a similar bill remains stalled there. In the letter, the lawmakers cited a letter by Larry Sonsini, H-P's outside attorney, reportedly suggesting that using pretexting services wasn't clearly illegal.

"If an attorney of Mr. Sonsini's caliber...believes that pretexting is not already a crime, then the time has come to clearly and unambiguously make such activity illegal," the lawmakers wrote.

Meanwhile, House Energy and Commerce Committee Chairman Rep. Joe Barton (R., Texas) and Rep. John Dingell (D., Mich.), the panel's senior Democrat, asked Ms. Dunn to identify firms or people hired to obtain directors' and journalists' phone records. "The committee is troubled by this information, particularly given that it involves H-P -- one of America's corporate icons -- using pretexting and data brokers to procure the personal telephone records of the members of its board of directors and of other individuals without their knowledge or consent," the letter said.

[pchang]

What exactly do you mean by unravel?

Hurd will be CEO and Chairman. I don't see that changing. Do you think Dunn will be forced off the board altogether?

[DanS]

Well, it looks like all is settled, including with Perkins. But it seems that Dunn should be forced off the board altogether and that an independent board should be required, rather than one headed by the CEO. Perkins may find it difficult to reign in the processes he has started in motion.

[pchang]

I agree with the independence

but since Hurd has turned the stock around (80% increase since he took over), his halo effect is pretty strong.

[One_more_turn]

Originally posted by One_more_turn
It's pretty obvious that Patricia Dunn made a power grab, but shot herself in the foot instead. She wanted to use this 'leak investigation' to oust existing board members and replace them with her cronies. But the other side was not stupid and might have even set a trap. I think Dunn's days at HP are numbered. She will ruthlessly rushed out the door like Carly.

Today is just the first step. She'll be out of HP altogether and facing criminal charges.

A deserving end for another power-hungry wench!

[pchang]

Originally posted by One_more_turn


Today is just the first step. She'll be out of HP altogether and facing criminal charges.

A deserving end for another power-hungry wench!

A little mysogynist?

[Dinner]

She's finished. MSNBC is now reporting she will step down.

[Jaguar]

Originally posted by One_more_turn


Today is just the first step. She'll be out of HP altogether and facing criminal charges.

A deserving end for another power-hungry wench!

Who are you? You aren't allowed to post jackass extremist opinions until people have heard of you.

[One_more_turn]

Mark Hurd is the big winner: his reputation remains untarnished, he has consolidated his power at HP, and he enjoys investors' confidence (HP's stock is making 52 weeks highs while this soap opera is being played out). With Perkins gone, Keyworth and Dunn forced out, and Wayman near retirement, he now gets to fill 4 board members with his allies.

[DanS]

Tomorrow's WaPo has an A1 article describing Hurd's approval of a "sting" operation against the cnet reporter.

http://www.washingtonpost.com/wp-dyn/content/article/2006/09/20/AR2006092001964.html

Don't these folks have anything better to do than to spend all day plugging leaks? Like run a $100 billion company?