THE investigation into boardroom leaks at Hewlett-Packard widened yesterday as the US Department of Justice launched its own inquiry into allegations that private detectives hired by the troubled computer maker used improper surveillance techniques to find out who among the board was giving secret information to the press.
The latest investigation came as HP’s ten-member board met for a second day to decide the fate of Patricia Dunn, the non-executive chairman, who has faced calls for her resignation over her handling of the affair. The board met on Sunday by telephone conference, and a split between Ms Dunn’s supporters and detractors emerged. No decision was made then about her future.
But, as yesterday’s meeting was about to begin, there was a growing belief among Wall Street analysts that Ms Dunn could not let a question mark hang over her for too long because it could distract the company from its day-to-day operations.
Investors, however, appeared not to have withdrawn their support for the HP chairman, as the shares were largely unchanged at $36.42 by lunchtime in New York. HP’s latest round of boardroom troubles began in May, when the company revealed the results of a long-running investigation to determine who had been leaking sensitive company information early last year, about the time that Carly Fiorina was forced to resign as chief executive.
The investigation pointed the finger at George Keyworth, a longtime director, whom the board asked to resign. He refused, saying that he served at the pleasure of shareholders.
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But Thomas Perkins, another HP director and a powerful Silicon Valley venture capitalist, resigned in protest when it was discovered that his phone records, and those of other members of the board, had been obtained without his permission by a firm of private detectives working for HP.
The detectives hired another consultancy that engaged in a practice known as pretexting, which involves pretending to be a customer of a phone company to obtain calling records.
The practice is not illegal in every state, but it is thought to contravene identity-theft laws in California.
Mr Keyworth, who is still on the HP board is understood to be leading calls from within for Ms Dunn to resign. Ms Dunn, who claims to have had no idea that pretexting was used in the investigations, has refused to resign but has said she will go if the board so requests.