HP spy vs. leaker (and 2356 days of Noah)

Call the Mario Brothers! It's IT Blogwatch, in which HP springs a leak, teaching us the meanings of "sub rosa" and "pretexting." Not to mention a video of some guy's face every day for 6.5 years...

China Martens has the story:

All's not well in the upper echelons of Hewlett-Packard ... The brouhaha relates to the sudden and unexpected resignation of Silicon Valley venture capitalist Thomas Perkins from HP's board of directors ... he quit over concerns with the board's handling of investigations into leaks of confidential information ... HP turned to an external legal counsel who interviewed the board's directors in early 2005 ... The interviews didn't turn up the party responsible, and the leaks continued.

HP then brought in an external specialized investigations firm that revealed that George Keyworth, an HP director since 1986, has been disclosing board deliberations and other confidential information to the media without authorization

... at that point Perkins announced his own resignation, citing "personal frustration" with the chairman of the board in how the whole leaks investigation was handled, the filing said. Perkins didn't like the matter being aired before the entire board and had believed that he and HP Nonexecutive Chairwoman Patricia Dunn would handle the matter privately.

...

Perkins asked HP's nominating and governance committee to carry out an inquiry into whether the techniques used to conduct the investigation were appropriate ... counsel discovered that a third party retained by the external consulting firm HP brought in to investigate the leaks "had in some cases employed pretexting."

Pre-what? Our own Martin McKeay explains:

What I find interesting in this situation is that the surveillance consultants didn't actually tap any of the phone calls of the directors; instead, they did what the article calls 'pretexting', a form of fraud where the consultant calls the phone company and pretends to be the person under surveillance and asks for their phone records. I call it fraud, plain and simple. They then used the metadata contained in the phone records to determine who the directors were calling and when, which provided enough information for them to determine who was the press leak.  This was provided to Chairwoman Dunn and was enough evidence for her to ask for the resignation of the offending board member.

...

Do her ends justify her means?  On another level, this can be seen as a direct parallel to our own government's desire to see our phone and search records; the only difference is the government is using 'terrorists' as the justification, not 'press leak'.  The scale is different, but the scenario is the same.

Ex-HP'er Dave Taylor puts it more bluntly:

If indeed Keyworth was sharing confidential information with journalists and violating the sanctum and requisite confidentiality of the Boardroom, he was deeply in the wrong ... violation of that confidentiality should always be grounds for immediate dismissal from any Board ... but let's not lose track of the fact that, just as with a legal investigation, the method by which it was identified is equally important.

The irony? When the press started to feature stories about the HP Board deliberations regarding Fiorina's performance, she reputedly flew into a rage and insisted that identifying the source of the leak was more important than even evaluating her poor performance. She got so worked up trying to identify the source of the leak, she missed the forest for the trees.

...

Patricia Dunn, has fallen into the very same mistake, being so eager to finally identify the source of leaks from the Board that she hired private investigators who apparently used illegal tactics to run down the culprit.

But it doesn't end there, if you can believe it ... she went to the head of the Audit Committee to talk about the situation, bypassing the correct committee to have been involved with the situation, the Nominating and Governance Committee. No wonder Perkins, head of that committee, was furious when things transpired.

...

It's time for a real chairperson to pull together a real Board of professionals who can lead this company out of the darkness that's engulfed it for years now. Even with its solid financial results, a company that's rotten in the Boardroom isn't a company that has good long-term prospects. I believe that Patricia Dunn should be fired.

Techdirt's Mike thinks about the corporate surveillance angle:

We were just talking about how the tools were getting better, but we meant for watching customers, not other board members. HP maintains that using false pretenses to obtain others' phone records is not, technically, spying -- and therefore Dunn has done nothing wrong. However, now that this story has become public, it seems like Dunn may discover that the distinction is lost on HP shareholders who might wonder why she spent so much effort spying on other board members instead of helping guide the company.
Dwight Silverman plays up the Houston connection:

Perkins previously had been a member of the Compaq board, and joined HP's board -- over the objections of then-CEO Carly Fiorina -- when HP and Compaq merged ... Leaks to the press had been an ongoing issue at HP during Fiorina's tenure, and bedeviled the company during its controversial merger with Compaq. The latest tumult can be seen as a lingering bit of fallout from that deal, and it comes at an unfortunate time for HP, which is finally seeing its fortunes rise after a long period of decline. The company doesn't need this kind of distraction now.
Erick Schonfeld:

Patricia Dunn apparently thinks she is Patrick Fitzgerald (the prosecutor who investigated the leak of Valerie Plame's CIA identity) ... it's heartening to see a corporate insider like [Perkins] stand up for his principles and ethics instead of for his cronies. As for HP shareholders, they  should now be asking themselves what was really gained by the investigation,and whether it was worth all the bad press that its unveiling is now generating.
The Smoking Gun has a copy of Perkins' letter to the HP board:

In a blistering letter to the computer firm's directors, Thomas Perkins wrote that he quit the HP board in protest of the "questionable ethics and the dubious legality" of methods employed ... According to Perkins, ... the Fortune 500 company's probe included the "fraudulent method" of obtaining the "private telephone records" of board members ... Perkins contended that his own phone records were "hacked" as part of Hewlett-Packard's attempt to discern the source for a January 2006 Cnet.com story about the firm's long-term strategy ... in a June 28 e-mail, lawyer Larry Sonsini, Hewlett-Packard's outside counsel, confirmed that the company obtained phone calls "made and received by the cell or home phone of directors" and that the records were procured "through a third party that made pretext calls to phone service providers." Perkins's own phone records were illegally accessed shortly after the media leak ... contends that the firm has never properly accounted to the Securities and Exchange Commission for the reasons for his departure.

... (4 pages)

John Paczkowski calls for new balls, please: [You're fired -Ed.]

So much for the HP way ... astonishing lapse in judgement that may forever tarnish the the core values established by its founders some 50 years ago ... Here's hoping HP's shareholders take it to heart and do what the company's board lacked the testicular fortitude to do: demand Dunn's resignation.
Speaking of (base)ball, Preston Gralla wonders about redsox9855@yahoo.com:

The person doing the hacking was unethical, and potentially breaking the law as well. But heck, he was a Red Sox fan. And speaking as a member of the same long-suffering brotherhood, that means he can't be all bad.
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And finally... Noah Kalina's face every day for 6.5 years

Richi Jennings is an independent technology and marketing consultant, specializing in email, blogging, Linux, and computer security. A 20 year, cross-functional IT veteran, he is also an analyst at Ferris Research. Contact Richi at blogwatch@richi.co.uk.

Copyright © 2006 IDG Communications, Inc.

  
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