South-Western - Management  
Secret H-P Probe Casts a Wider Net
Topic Ethics and Social Responsibility
Key Words Surveillance, corporate spying, corporate boards
News Story

A covert investigation of leaks of critical information at Hewlett-Packard was more elaborate than was originally reported, and involved the illicit gathering of phone records and direct surveillance of board members and journalists.

Patricia Dunn, the company’s chairwoman, supervised the effort initially but then farmed out responsibility to a network of private investigation firms last year. Those detectives tried, among other things, to plant software on at least one journalist’s computer that would trace messages sent. They also followed journalists and board members in an attempt to determine who the information-leaker was.

The scandal around the methods HP used to obtain this information has resulted in Dunn’s agreement to step down as chairwoman in January, as well as two other board members’ resignations.

The most troubling part of the story, however, has been the questionable and possibly illegal methods used to uncover the potential leak on the board. The possibility of criminal charges is being considered by the California attorney general and the U.S. attorney in San Francisco.

H-P has said that as a public company, it had a responsibility to stop the leak of information that could hurt the company. At various times during the investigation, questions about the legality of the spying methods were raised, and a Boston firm that shares an address with the detective firm working on the case, appears to have given a crucial legal opinion in the case.

The investigation began after The Wall Street Journal and The New York Times published detailed information about board of director’s meetings, and the company tried to determine who was leaking information.


Research the latest information on the H-P probe. What prompted the internal investigation? What was Chairwoman Patricia Dunn hoping to find out?


What methods did the investigation use to try to find out who was leaking information that was only known to the H-P board?


In your opinion, was H-P within their rights to try to find out what board member was leaking private information about the company?


Many companies are using technology to read employee’s e-mail and track activity on websites, etc. Do you see this as a potential invasion of privacy? Or do you think companies are within their rights to know what employees are doing at all times at work? Do you have concerns for personal privacy? Where should the line be drawn? Be prepared to discuss your thoughts in class.

Source “Secret H-P Probe Casts a Wider Net,” Chicago Tribune, September 18, 2006, pp.3-1, 3-4.
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