The New York Times is reporting on a private settlement reached between HP and several journalists over HP's acquisition of the journalists private phone records. HP, aided an abetted by law firm Wilson Sonsini famously went on the war path against C-suite leaks under the direction of then CEO Patricia Dunn. Enlisting a small army of investigators from all across the country HP was determined to identify and eradicate the source of the troublesome leaks - by any means necessary.

The means ended up being a smorgasborg of high level and low level investigative tasks - from surveillance to pulling trash to the acquisition of phone records belonging to company board members as well as reporters. In the course of what became known as the Kona II investigation HP board member and Silicon Valley royalty, Tom Perkins - a suspected leaker - got wind of the activities. Perkins subsequently resigned from the board, which in a bit of executive gamesmanship, forced HP to file an 8K with the SEC reporting the departure - and the reason behind it.

About that time the proverbial shit hit the fan and the story was splashed across business pages from here to Taipei.

HP has already skated on any meaningful civil or criminal charges (the firm paid a $14.5 million settlement to head off charges in California), but the attention brought by the pretexting fracas led to new Federal legislation closing the legal loophole that had allowed private investigators to use pre-textual techniques to obtain private phone records. While this latest news of a private settlement brings to a close one more aspect of the story five additional lawsuits brought by journalists and their families remain pending. You an be sure we'll bring further happenings on those cases to your attention.

-- MDT

Labels: HP, Patricia Dunn, pretexting, Tom Perkins, Wilson Sonsini

Venture capitalist and bon vivant Thomas Perkins is one of the long-time stars of Silicon Valley, but he gained a different kind of noteriety last year when he went to war with then Hewlett Packard Chairman of the Board, Patrica Dunn.

Perkins, an HP director, was fingered (incorrectly) by Dunn as the mole in what became known as the Kona II investigation of HP employees and the journalists with which they may have sharing company secrets. Dunn initiated the investigation, with famed Cali counsel Wilson Sonsini at her side, employing several independent private investigators - all in an attempt to shut down the leaks she felt were plaguing the company.

As has been widely reported, the investigation went well beyond what was advisable or legal and led to a major conflagration in the press as well as state and national legislatures over the issue of phone record privacy and the investigative tactic known as pretexting. Dunn herself, along with HP's general counsel, was a casualty of all this attention, losing her chairmanship and eventually resigning from the HP board.

The Times of London has run an excerpt from Tom Perkins autobiography, Valley Boy, which describes his first person reaction to the Dunn investigation and the thought process behind his subsequent resignation from the HP board. Really good stuff...

-- MDT

Labels: HP, Kona II, Patricia Dunn, pretexing, Thomas Perkins

In a move that had been expected for some time, several lawsuits alleging "illegal and reprehensible conduct" have been filed against Hewlett Packard as well as the company's former CEO, Patricia Dunn and Kevin Hunsaker, PH's former ethics chief.

These would be the two company executives most closely associated with the hiring of private investigators, who among other things, used pretextual tricks to obtain private phone records of several individuals who HP suspected of facilitating media leaks of sensitive company information.

Amongst the plaintiffs in the five cases are journalists from the Associated Press and CNET. More on the pending cases via MLive. Loads of background on HP corporate spying fiasco is available via the tags below.

-- MDT

Labels: HP, Kevin Hunsaker, Patricia Dunn, pretexing, Wilson Sonsini

HP violated mandatory disclosure rules when it failed to come clean in company 8Ks about the reason that shareholder Tom Perkins left the board of directors. Perkins, a noted venture capitalist and an old-school Don of Silicon Vally hardly needed the HP board berth to pad his extensive resume.

As you may recall, Perkins left his seat to protest HP's spying on himself, other board members and various journalists.

HP top brass, including former CEO Patricia Dunn believed Perkins to be the source of media leaks that were hampering the company. In response Dunn, HP's general counsel, outside counsel Wilson Sonsini and a cadre of investigators and subcontractors initiated what came to be known as Kona II, an investigation that included surveillance, pulling trash and obtaining phone records under false pretenses.

There are no "teeth" to the SEC's settlement with HP. The company simply double-promises not to violate disclosure rules in the future. No penalty was assessed.

For further background on the HP shenanigans - that is, if you're not totally sick to death of the story - check out the tags below.

-- MDT

Labels: HP, Kona II, Patricia Dunn, pretexing, Wilson Sonsini

Talk about a lot of sound and fury signifying nothing... The California AG, who was full of tough talk only a few months back when it came to the HP pretexting scandal, has dropped criminal charges against HP's former Chairman, Patrician Dunn.

They've also reached plea agreements with her co-defendants (former ethics chief Kevin Hunsaker and private investigators Ronald DeLia and Matthew DePante) basically amounting to restitution and community service.

Still, Federal pursuit of prosecution is not entirely out of the question. To date only PI. Bryan Wagner has so far faced federal felony charges. He previously plead guilty to both identity theft and conspiracy.

-- MDT

Labels: Bryan Wagner, HP, Kevin Hunsaker, Kona II, Patricia Dunn, pretexting, Ronald DeLia

Michael Holston will assume the role of vice president and general counsel for HP, which cleaned house after news of Patricia Dunn's Kona 2 investigation exploded into the newspapers. Holston replaces Ann Baskins who departed HP in September in response to the scandal over the technology company's internal leak investigation.

Investigators working on behalf of HP used pretextual tactics (in this case, assumed identities) to access private phone records of HP directors and even journalists, hunting for the source of high level company leaks. These tactices were supposedly vetted by HP's general counsel's office and also run past outside counsel Wilson Sonsini. WS has also been dumped by HP as the company tries to creep out from under the long shadow of its own making.

-- MDT

Labels: HP, Patricia Dunn, pretexting, Wilson Sonsini

This would not be the folks from the Boston-area firm, Security Outsourcing Solutions, that you've read about previously, but rather P.I. Bryan Wagner our of San Francisco.

Wagner has been indicted in California on charges of utilizing the social security number of a journalist to obtain that individual's telephone records. He apparently did so at the direction of HP execs, their legal team or other investigators working on HP's behalf as a part of their internal "Kona 2" investigation to identify the source of HP's persistent high-level media leaks.

Wagner is facing charges of conspiracy and identity theft, which could carry penalties of up to seven years in jail. That California AG's office had previously announced that they were going to go hard on this matter and it looks like they are following through on the threat. It is expected, though, that the Wagner indictment is just bait to catch bigger fix. He is expected to cooperate with authorities.

Read more on the Wagner indictment via the IHT.

-- MDT

Labels: Bryan Wagner, HP, identity theft, Joseph DePante, Patricia Dunn, pretexting, Ronald DeLia, Wilson Sonsini

Great Law.com article. There is some massive balancing force in the universe that sees Milberg Weiss and Wilson Sonsini (two law firms that have spent more than a fair amount of time on opposing sides of the aisle from one another) both in the legal cross-hairs at the same time.

It is weird the way the world works.

-- MDT

Labels: HP, Melvyn Weiss, Milberg Weiss, Patricia Dunn, Wilson Sonsini

Hewlett Packard CEO and spymaster, Patricia Dunn is sitting in quite the hot seat this week. Clearly she underestimated the potential (turns out, overwhelmingly) negative reaction to public disclosure of her acquisition of ten HP directors' personal phone records through questionable means. Dunn is now facing a much bigger problem than the media leaks her mole hunting was supposed to eliminate. The HP board is set to meet again as soon as today to determine what, if anything, will be done with Dunn. Meanwhile, here's a handy FAQ on the whole situation, from CNet and a little background on the phone records privacy issue. No new news for regular readers of this space.

As an aside, when we founded Caveat Research, my former firm, back in 2004, we made a decision that we would not employ pretextual interview techniques, and we certainly would have never, via a pretext, used an individual's personal details to obtain their private phone records. Even without pretexting, I'd like to think that our work product stood well alongside anyone else's in the business. All the same, you have to feel for Patricia Dunn. She's the CEO of a long-struggling company that was faced with regular, frustrating leaks to the media that she felt hurt their business.

As an executive might on any other internal fraud matter, she employed investigators to get to the bottom of it. And she DID get her man. The problem comes with the short cuts allowed by the phone record legal loophole (soon to be closed). With their tactics the investigators involved put their client (or in this case, their client's client) in line for potentially serious blowback. The investigators could have likely come up with evidence just as damning regarding confirmed leaker, George Keyworth II, without employing pretexting, just as professional atheletes who use steroids could in many cases reach the same heights of performace without the use of drugs. The results might not be as comprehensive or sexy and the investigation might have taken longer, but no one would be talking about Dunn losing her job at this point either.

-- MDT

Labels: Caveat Research, HP, Patricia Dunn