California AG: HP Indictments Possible

The California Attorney General said late Tuesday that he had enough evidence to bring charges against some of those involved in the HP leak probe scandal, and that the indictments may not be limited to individuals within the company. The comments were made during an interview on the NewsHour with Jim Lehrer that aired Tuesday night.

Attorney General Bill Lockyer indicated that indictments are fairly likely. "We currently have sufficient evidence to indict people, both within Hewlett-Packard, as well as contractors on the outside," he told the newscast. Lockyer's comments are certainly not good news for HP.

The company is still awaiting results of an inquiry by the Justice Department, where charges could also be brought, and from the House Energy and Commerce Committee, where company officials could be summoned to testify at hearings on the subject.

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At the center of the firestorm is the company's use of a technique called "pretexting," which dupes companies into divulging personal information - in this case, phone records. Chairwoman Patricia Dunn authorized the move, which peered through the phone records of all its board members, and nine reporters, including those at CNET News.com, The Wall Street Journal and the New York Times.

Dunn's actions led to her removal from the chairwoman's position Tuesday, a change that will take effect in January 2007. HP CEO and president Mark Hurd will assume Dunn's duties, as well as retain his prior position. Dunn would stay with the company, but as a director.

It is not immediately clear who investigators are targeting, although Boston University School of Management professor James Post told Bloomberg he thought that it was "someone in the chain of command between the chairman and the outside counsel."

According to Lockyer, HP's investigation violated both identity and computer theft laws. However, pretexting is not exactly illegal in California, and some lawyers believe that depending on how it was done, it may actually fall into a gray area that would be impossible to prosecute.

Neither HP nor Lockyer's office would comment further on the situation, although HP offered that it was cooperating with the California Attorney General's inquiry.

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