Week in review: HP's spy games

As more details emerge on the company's probe into media leaks, Dunn resigns and Hurd says he was in the loop.

Bogus e-mail tips, physical surveillance and plans to infiltrate newsrooms with covert investigators--the actions of a Silicon Valley icon are sounding more and more like the stuff of Hollywood movies.

Day by day, more details emerged of Hewlett-Packard's investigation into leaks to the media from its boardroom. The week came to a climax on Friday afternoon, when to address the issues.

Hurd announced that Chairman Patricia Dunn would resign from the board, effective immediately, and that he would take over the chairman's post. He also confirmed that he knew about several key phases of the investigation and attended meetings where the investigation was discussed. In addition, he said that he was e-mailed a report summarizing the investigation, but that he did not recall reading the report.

"I could have and I should have," Hurd said.

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HP's boardroom drama
Catch up on the complete coverage, including the latest news on HP's controversial effort to root out media leaks.

Earlier in the week, Hurd had been linked to at least a part of the operation.

The company began tracking the phone records of News.com reporter Dawn Kawamoto on Jan. 17, about a week after a January strategy meeting for HP directors and executives and but six days before News.com published its Jan. 23 story about the meeting. News.com reporter Tom Krazit's personal phone records were accessed on Jan. 20, the same day he called HP spokesman Robert Sherbin for comment about the board meeting.

It has been widely thought that HP reignited and intensified a nearly yearlong leak probe after that story published, but the account given to Krazit and Kawamoto suggests HP had in place the means to quickly track down private phone records before their articles were published.

In addition, investigators tried to draw a connection between a board member and the father of a third News.com reporter.

HP investigators also employed physical surveillance on Kawamoto for three days starting on Feb. 9. One note by the investigators said: "Morning of Feb. 10: surveillance resumed on DK and on other subjects." Included in the notes is at least one surveillance photo of Kawamoto.

A sting operation conducted by HP investigators also sought to determine the source of the leaks; it focused on Kawamoto. Just days after the Jan. 23 story was published, she received an e-mail from someone posing as an HP tipster, government investigators have told Kawamoto.

A later e-mail from the fake tipster included an attachment believed to have contained marketing information about a new HP product. That attachment, government investigators told Kawamoto, is believed to have had the ability to track the e-mail, notify the sender if it was opened, and tell the sender if the e-mail was forwarded and to which IP address it had been forwarded.

HP also conducted feasibility studies on planting spies in news bureaus of two major publications as part of an investigation of news leaks from the company's board, according to a report in The New York Times. The studies, referred to in a Feb. 2 draft report for a briefing of senior management, included the possibility of placing investigators acting as clerical employees or cleaning crews in the San Francisco offices of CNET and the Wall Street Journal.

In addition to federal and state investigations of HP, the company has received an additional inquiry from the Securities and Exchange Commission regarding both the company's leak probe disclosure and its handling of the resignation of board member Tom Perkins.

News.com readers were largely incensed by the revelations of HP's behavior.

"It is amazing how the HP sewage widens every so more as time goes on, but the HP board members who were involved in this unethical, illegal, and immoral acts are still loose in public, even being awarded for the Business Hall of Fame. What a joke!" to the TalkBack forum.

Watching on the Web
Attorney General Alberto Gonzales stepped up his efforts to lobby for federal laws requiring Internet providers to keep track of what their customers do online. Gonzales asked senators to adopt "data retention" legislation that would likely force Internet providers to keep customer logs for at least a year or two. Those logs, often routinely discarded after a few months, are intended to be used by police investigating crimes.

"This is a national problem that requires federal legislation," Gonzales said during a Senate Banking Committee hearing.

It's unclear what the prospects are for mandatory data retention in Congress this year, or whether politicians will delay action until 2007. But with the Bush administration firmly behind the concept, and with state and local law enforcement lending a hand in the lobbying efforts and saying such mandates would help protect children, industry groups and privacy advocates may be hard-pressed to head off new regulations.

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