HEWLETT-PACKARD’S 

PRETEXTING SCANDAL 

HEARING 

BEFORE THE 

SUBCOMMITTEE ON OVERSIGHT AND 

INVESTIGATIONS 

OF THE 

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED NINTH CONGRESS 

SECOND SESSION 

SEPTEMBER 28, 2006 

Serial No. 109-146 

Printed for the use of the Committee on Energy and Commerce 

Available via the World Wide Web: http://www.access.gpo.gov/congress/house 

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WASHINGTON : 2006 

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31-472DF 
COMMITTEE ON ENERGY AND COMMERCE 

JOE BARTON, Texas, Chairman 

RALPH M. HALL, Texas 

MICHAEL BILIRAKIS, Florida 

 Vice Chairman 

FRED UPTON, Michigan 

CLIFF STEARNS, Florida 

PAUL E. GILLMOR, Ohio 

NATHAN DEAL, Georgia 

ED WHITFIELD, Kentucky 

CHARLIE NORWOOD, Georgia 

BARBARA CUBIN, Wyoming 

JOHN SHIMKUS, Illinois 

HEATHER WILSON, New Mexico 

JOHN B. SHADEGG, Arizona 

CHARLES W. “CHIP” PICKERING, Mississippi 

 Vice Chairman

VITO FOSSELLA, New York 

ROY BLUNT, Missouri

STEVE BUYER, Indiana 

GEORGE RADANOVICH, California 

CHARLES F. BASS, New Hampshire 

JOSEPH R. PITTS, Pennsylvania 

MARY BONO, California 

GREG WALDEN, Oregon 

LEE TERRY, Nebraska 

MIKE FERGUSON, New Jersey 

MIKE ROGERS, Michigan 

C.L. “BUTCH” OTTER, Idaho 

SUE MYRICK, North Carolina 

JOHN SULLIVAN, Oklahoma 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

JOHN D. DINGELL, Michigan 

 Ranking Member 

HENRY A. WAXMAN, California 

EDWARD J. MARKEY, Massachusetts 

RICK BOUCHER, Virginia 

EDOLPHUS TOWNS, New York 

FRANK PALLONE, JR., New Jersey 

SHERROD BROWN, Ohio 

BART GORDON, Tennessee 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

BART STUPAK, Michigan 

ELIOT L. ENGEL, New York 

ALBERT R. WYNN, Maryland 

GENE GREEN, Texas 

TED STRICKLAND, Ohio 

DIANA DEGETTE, Colorado 

LOIS CAPPS, California 

MIKE DOYLE, Pennsylvania 

TOM ALLEN, Maine 

JIM DAVIS, Florida 

JAN SCHAKOWSKY, Illinois 

HILDA L. SOLIS, California 

CHARLES A. GONZALEZ, Texas 

JAY INSLEE, Washington 

TAMMY BALDWIN, Wisconsin 

MIKE ROSS, Arkansas 

BUD ALBRIGHT, Staff Director 

DAVID CAVICKE, General Counsel

REID P. F. STUNTZ, Minority Staff Director and Chief Counsel

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS 

ED WHITFIELD, Kentucky, Chairman 

CLIFF STEARNS, Florida 

CHARLES W. “CHIP” PICKERING, Mississippi 

CHARLES F. BASS, New Hampshire 

GREG WALDEN, Oregon 

MIKE FERGUSON, New Jersey 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

JOE BARTON, Texas 

 (EX OFFICIO)

BART STUPAK, Michigan 

 Ranking Member 

DIANA DEGETTE, Colorado 

JAN SCHAKOWSKY, Illinois 

JAY INSLEE, Washington 

TAMMY BALDWIN, Wisconsin 

HENRY A. WAXMAN, California 

JOHN D. DINGELL, Michigan 

 (EX OFFICIO)

(II)
CONTENTS 

Page 

Testimony of: 

Dunn, Patricia, Former Chairman of the Board, Hewlett-Packard Company................... 44 

Sonsini, Esq., Larry W., Chairman, Wilson Sonsini Goodrich & Rosati........................... 78 

Adler, Fred, IT Security Investigations, Hewlett-Packard Company................................. 80 

Hurd, Mark, President, Chief Executive Officer, and Chairman of the Board, HewlettPackard Company .......................................................................................................... 731 

Additional material submitted for the record: 

Hurd, Mark, President, Chief Executive Officer, and Chairman of the Board, HewlettPackard Company, response for the record of............................................................... 766 

(III) 

(1) 

HEWLETT-PACKARD’S 

PRETEXTING SCANDAL 

THURSDAY, SEPTEMBER 28 2006 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON ENERGY AND COMMERCE, 

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS, 

Washington, DC. 

The subcommittee met, pursuant to notice, at 10:06 a.m., in Room 

2123 of the Rayburn House Office Building, Hon. Ed Whitfield 

[Chairman] presiding. 

Present: Representatives Whitfield, Stearns, Bass, Walden, Burgess, 

Blackburn, Barton (ex officio), DeGette, Schakowsky, Inslee, Baldwin, 

and Dingell (ex officio). 

Staff Present: Mark Paoletta, Chief Counsel for Oversight and 

Investigations; Thomas Feddo, Counsel; Andrew Snowdon, Counsel; 

Krista Carpenter, Counsel; Peter Spencer, Professional Staff Member; 

John Halliwell, Policy Coordinator; Clayton Matheson, Analyst; Ryan 

Ambrose, Legislative Clerk; Matthew Johnson, Legislative Clerk; Chris 

Knauer, Minority Investigator; Consuela Washington, Minority Senior 

Counsel; and Chris Treanor, Minority Staff Assistant. 

MR. WHITFIELD. Today, the Subcommittee on Oversight and 

Investigations will examine how and why Hewlett-Packard Company, 

one of America’s largest technology companies, used pretexting and 

other nefarious practices as part of an internal corporate investigation. 

This subcommittee has been examining the practice of pretexting for 

the past 8 months. To be clear, pretexting means using fraud, deceit and 

impersonation to acquire someone’s personal records without his or her 

consent. The relative ease with which unscrupulous pretexters can 

obtain private information is cause for great concern. 

During our hearings we heard testimony from witnesses who were 

unsettlingly proficient in obtaining personal information regarding phone 

calls, bank accounts, credit card charges and other information without 

the consent of the person whose information they obtained. 

We also discovered that pretexting is commonly used for 

investigation purposes as well as for the purposes of identity theft, and 

we heard testimony how it was used frequently by the national news 

media. 

Hewlett-Packard has long been one of the most admired companies 

in America. Consequently, people were really shocked to learn that a 
2

company of this stature would resort to such tactics in an effort to 

identify the source of Boardroom leaks. Pretexting for phone records, 

physical surveillance, monitoring of e-mail were all part of the plan. 

HP’s investigative team even tried to plant or discuss planting electronic 

tracing software into a reporter’s e-mail account and even considered 

planting undercover spies in several newsrooms. 

While there is nothing objectionable on its face about 

Hewlett-Packard trying to determine the source of leaked confidential 

information, the methods used were clearly unacceptable. Obtaining 

private call records by pretexting is an invasion of privacy and probably 

is illegal. 

For over a year, the most senior levels of management at the 

company were designing and directing the investigation. This isn’t a 

case of some out-of-control and overzealous contractor who was hired to 

conduct a search for a leaker. Rather, this investigation was led by the 

Chairman of the Board Patricia Dunn; the company’s Senior Legal 

Counsel Ann Baskins; and the day-to-day operations were overseen by, 

of all people, the company’s chief ethics lawyer Kevin Hunsaker. 

We hope to get a better understanding today why no one among this 

group of very smart and experienced people had the good sense and 

courage to say, stop, this may be illegal, and at the very least it is not the 

way we should be doing business. And how, after all was said and done, 

could the Board’s outside counsel, Mr. Larry Sonsini, review the 

investigation and say that pretexting for phone records of Board 

members, employees and journalists was above board and legitimate? 

Further, I give little credence to the argument that HP was unaware 

that its outside consultants were inappropriately gaining access to 

confidential telephone records. If there are legitimate ways to obtain 

someone’s private records without their consent, short of a subpoena, I 

would be interested in knowing what they are. Our hearings this past 

June demonstrated that there are really none, and testimony from the FBI 

suggested that the Federal Wire Act may be implicated by pretexting. It 

is the company’s responsibility to know what those operating on its 

behalf are doing and how they are doing it. 

If you turn to the first page of the Hewlett-Packard Standards of 

Business Conduct, it reads, “Hewlett-Packard conducts its business with 

uncompromising integrity. Every member of the Hewlett-Packard 

community, directors, executives, managers, employees and business 

partners, have a duty to comply with all applicable law and adhere to the 

highest standards of business ethics.” It appears that they fell short this 

time. 

The committee began its oversight work of the Hewlett-Packard 

matter just a short time ago on September the 11th. We moved 
3

aggressively to learn as much of the facts as possible and hold this 

hearing and share the information with the American people. Our pace 

meant reviewing tens of thousands of documents in very short order, and 

I would like to commend Hewlett-Packard for doing everything in its 

power to cooperate fully and completely with the committee’s 

investigation on our schedule to ensure that this hearing was productive 

and we had all the information. I want to thank you for that. 

[Prepared statement of Hon. Ed Whitfield follows:] 

PREPARED STATEMENT OF THE HON. ED WHITFIELD, CHAIRMAN, SUBCOMMITTEE ON 

OVERSIGHT AND INVESTIGATIONS

 Good morning. Today the Subcommittee on Oversight and Investigations will 

examine how and why Hewlett-Packard Company, one of America’s most famous 

corporations, used “pretexting” and other nefarious practices as part of an internal 

corporate investigation. Documents reviewed by the Committee have revealed a series of 

investigations that were part Keystone Cops, part Mission Impossible, and part All the 

President’s Men. Sometimes the truth really is stranger than fiction. 

 This Subcommittee has been examining the practice of “pretexting” for the past 

eight months, and to date we have held two hearings on this topic. To be clear what we 

are talking about, pretexting, or “social engineering,” means using fraud, deceit, and 

impersonation to acquire someone’s personal records without his consent. In this hightech age, personal information is not only valuable, but vulnerable, and the relative ease 

with which unscrupulous pretexters can literally con their way into our personal lives is 

cause for great concern. 

 Lest anyone think that pretexting is limited to shady collection agencies, private 

investigators, and bail bondsmen, the recently-emerged scandal involving HewlettPackard proves otherwise. But, according to an email written this past June by H-P’s 

outside counsel, Mr. Larry Sonsini, pretexting is “[a]pparently a common investigatory 

method” and H-P’s pretexting was “well done and within legal limits.” If a corporate 

icon like H-P can sink to this level, then all bets are off. 

 Hewlett-Packard and its storied past would easily make the cut for a corporate Hall 

of Fame, if there were one. Consequently, I was absolutely shocked to learn a few weeks 

ago that a company of this stature would resort to such despicable tactics in an effort to 

identify the source of boardroom leaks. Pretexting for phone records, physical 

surveillance, monitoring of email, and background investigations were all part of the 

plan. H-P’s investigation team tried to plant electronic tracing software into a reporter’s 

email account, and even considered planting undercover spies in several newsrooms. 

 While there is nothing objectionable on its face about H-P trying to determine the 

source of leaked confidential information, the methods used here were clearly 

unacceptable. Sneaking into someone else’s private calling records is a tremendous 

invasion of privacy. These records provide a virtual roadmap of people’s daily lives – 

who they talk to, when, for how long, and even from where they make those calls. 

Calling records expose business activities and personal interactions. 

 What is especially puzzling to me is how nobody at H-P saw this train wreck 

coming, especially H-P’s General Counsel. For over a year, the most senior levels of 

management at the company were designing and directing the investigation. This isn’t a 

case of some out-of-control and overzealous contractor who was hired to conduct a 

search for a leaker. Rather, this investigation was led by the Chairman of the Board, 

Patricia Dunn, and the company’s General Counsel, Ann Baskins, and the day-to-day 
4

operations were overseen by, of all people, the company’s chief ethics lawyer, Kevin 

Hunsaker. 

 Yet, Ms. Baskins resigned her position as General Counsel just this morning. Mr. 

Hunsaker and another H-P security employee who participated in the internal 

investigation, Mr. Anthony Gentilucci, left the company just this week. Why weren’t 

they fired a long time ago? If I were Mr. Hurd, I would have made a wholesale 

housecleaning months ago, when it became clear to the Board and others exactly what 

unsavory investigative methods were used by these H-P executives, lawyers, and 

employees. 

 The company’s records show that H-P senior management – Patricia Dunn, Ann 

Baskins, and Mark Hurd – were aware of the pretexting and of the plot to “sting” a 

journalist. Exactly what did they know about the use of pretexting? What did they know 

about planting spyware on an email to a journalist? The records also show that even the 

company’s CEO, Mark Hurd, was provided information about the results of the two main 

phases of the investigation and of the email sting operation. Exactly what did Mr. Hurd 

know about the methods used during the investigation, and did he know about the 

electronic tracer used during the email sting of the reporter? 

 I have to say, if I were a corporate executive, and my staff came to me with the last 

300 cell phone calls of the CEO of a competitor company – say, Michael Dell’s last 300 

calls – I would be incredulous, and a lot of alarm bells would go off. Why should the 

spying on phone records here be any different? The individuals at H-P who sanctioned 

this are very smart, high-level managers and officers, and on many levels it is a 

questionable and inadequate defense to say “the lawyers said this was okay.” We heard 

that unacceptable excuse with Enron, and other corporate investigations. And even if it 

were legal in some sense, is it ethical conduct? 

 I hope to get a better understanding today why nobody among this group of very 

smart and experienced people had the good sense and courage to say, “Stop. This may be 

illegal, and at the very least it’s not the way we should be doing business.” And how, 

after all was said and done, could the Board’s outside counsel, Larry Sonsini, review the 

investigation and say that pretexting for phone records of Board members, employees, 

and journalists was above board and legitimate? 

 Further, I give little credence to the argument that H-P was unaware that its outside 

consultants were inappropriately gaining access to confidential telephone records. If 

there are legitimate ways to obtain someone else’s private records without their consent -

- short of a subpoena -- I’d be interested in knowing what they are. Our hearings this past 

June demonstrated that there are none, and testimony from the FBI suggested that the 

Wire Act may be implicated by pretexting. It is the company’s responsibility to know 

what those operating on its behalf are doing and how they are doing it. 

 I intend to get to the bottom of Hewlett-Packard’s widely publicized pretexting 

scandal today, and I thank all of the witnesses for appearing. Perhaps by shedding some 

light on H-P’s conduct, we can discourage other companies from utilizing such 

unconscionable practices in the future. I also hope this provides some momentum for the 

Congress to pass this Committee’s legislation, H.R. 4943, and make pretexting for phone 

records explicitly illegal. 

 I now recognize the Ranking Member of the Subcommittee, Mr. Stupak. 

MR. WHITFIELD. At this time I would like to recognize the Ranking 

Minority Member, Ms. DeGette of Colorado, for her opening statement. 

MS. DEGETTE. Thank you very much, Mr. Chairman. And, Mr. 

Chairman, I bring Mr. Stupak’s apologies for not being here. He is at a 

funeral today. 
5

I would also ask unanimous consent to put my full statement and the 

statements of Mr. Stupak and other committee members in the record. 

MR. WHITFIELD. Without objection. 

MS. DEGETTE. Thank you so much, Mr. Chairman. 

Mr. Chairman, over the last few years this committee has looked at 

major corporate scandals in this country, like Enron and WorldCom. I 

was privileged to serve on this committee during those hearings as we 

helped shine a light on corporate excess and pave the way to reform. 

One thing I felt at the end of the first series of hearings was that we 

left issues of Board accountability on the table. And I think it is 

important as today we continue this committee’s oversight role in 

looking at issues of corporate accountability, and in particular board 

accountability. 

Today, as we continue our series of hearings on pretexting, this time 

in the corporate context, this gives us a good opportunity to open the 

window for some of the practices that are going on in corporations 

around the country. 

The corporate context of pretexting that we are talking about today, 

of course, involves Hewlett-Packard. It is a sad day for this proud 

company, and I have been sad to see all the witnesses, the fine corporate 

representatives who one by one have announced their intentions to 

exercise their Fifth Amendment rights, although I have got to say, given 

the facts, I don’t blame them. 

HP is a company of iconic status in the U.S. and around the world, 

and frankly, looking around this committee room, Mr. Chairman, there 

are many products that we are using today that bear the HP logo. This 

company was started in a small garage in Silicon Valley and grew to be 

one of the Nation’s largest employers. So we know how proud so many 

are about what Hewlett-Packard became over the years. 

But something has really gone wrong at this institution, and one of 

the questions I want to ask today is is it just with this institution, or is it 

endemic through corporate America that the kinds of excesses that we 

will hear about and that we have seen in the voluminous documents and 

interviews are going on throughout corporate America? 

Mr. Chairman, this hearing really is about more than sorting through 

the mess that has sullied Hewlett-Packard. It is more than about how the 

Hewlett-Packard way became synonymous with digging through 

people’s trash, setting up bogus e-mails which were approved at the 

highest levels of the company, and stinging unsuspecting reporters. And 

it is more than about how a computer company suddenly found itself in 

the business of trailing and photographing board members across the 

globe, or surveilling journalists using ex-FBI agents who sat in cars and 

watched as if their subjects were busy making truck bombs. 
6

As I reviewed all of the documents for this hearing today, I felt like I 

was looking at a proposal for a made-for-TV movie. And maybe this 

will be a made-for-TV movie, but I think it is awfully, awfully sad. 

What this hearing is really about is sorting through a dark chapter of 

corporate governance so that shareholders and the employees themselves 

can look and see is this the kind of corporate practice that we believe in 

in this country? 

Understanding what happened here hasn’t been easy. As you said, 

Mr. Chairman, our staffs have reviewed thousands of documents and 

interviewed many witnesses in a short period of time. But we have been 

able to formulate some key questions. Why were such marginal methods 

used in this investigation? Who approved them? And who knew about 

them, and when? Have these tactics been used before, and, if so, where? 

And will they ever be used again at Hewlett-Packard? I think I know the 

answer to that already. What assurances can the company give that 

protections are in place so they will not be used? And for those that did 

approve them, what was the justification? And did they believe that that 

approval showed good judgment? And finally, where were the legal and 

ethical guardians of HP’s corporate interests when all of this was 

happening, and whose job was it to steer this ship clear of the icebergs? 

For example, was it not a red flag when discussions were occurring 

about fraud and deception to obtain third-party phone records from 

journalists? Was it not a red flag when discussions were broached about 

even the possibility of placing janitors or fake employees in news 

organizations like the Wall Street Journal or CNET to engage in spying? 

Was it not a red flag when covert photographers were photographing 

board members or tracking their wives to Bingo parlors or reporters to 

their children’s schools? 

I am very concerned, Mr. Chairman, about the judgment that went 

into these decisions, and I am concerned more about whether this is just 

an accepted practice throughout corporate America. 

Finally, I am just as concerned about who made--about other people 

who may have known about these things and didn’t say no. I don’t 

understand how the entire Board of Directors, all of them potential 

targets of this spy ring, the CEO or the general counsel saw or knew so 

little when so much was going on. 

Finally, Mr. Chairman--and I will finish. We passed a bill on 

pretexting out of this committee last spring. We passed this bill on a 

unanimous bipartisan basis and sent it to the floor. It was scheduled for a 

vote on May 2nd of this year, where it apparently fell into a black hole. I 

think that these practices, which we now all agree--the pretexting which 

were illegal need to be stopped, and Congress needs to send a clear 

message. That message is we need to pass our pretexting legislation. 
7

Thank you very much, Mr. Chairman. 

MR. WHITFIELD. Thank you, Ms. DeGette. 

[The prepared statement of Hon. Diana DeGette follows:] 

PREPARED STATEMENT OF THE HON. DIANA DEGETTE, A REPRESENTATIVE IN CONGRESS 

FROM THE STATE OF COLORADO
8
9
10
11

MR. WHITFIELD. The Chair recognizes Mr. Walden for his opening 

statement. 

MR. WALDEN. Thank you very much, Mr. Chairman. I appreciate 

the work that you have put into this and that our committee staff has put 

into this as well. 

This is a most troubling day, as you can tell, for all of us in this 

room, certainly for you at Hewlett-Packard, in terms of what went on and 

what we now know and what we may learn today. It is troubling for, I 
12

think, all of us as Americans to know that this practice goes on all across 

this country. 

And if this practice were so simply described as legal, then I ask you 

why are so many witnesses today either going to take the Fifth 

Amendment or have quit their jobs? 

Clearly when the spotlight of public scrutiny is put to bear on this 

practice, it is obvious that nobody believes this is right, and I think that is 

the fundamental question here. For those who said conveniently, well, 

we are told it is legal, so it must be okay, where was somebody to say 

this just isn’t right? Somewhere some adult should have stepped forward 

and said, stop this, this isn’t right. 

Planting spies in newsrooms? I have a journalism degree. I can’t 

imagine in a newsroom having spies planted there to find out who might 

be leaking. Setting up e-mail spyware, tracking down who calls whom 

from their private cell phone or their home phone? 

This is not about law, this is about ethics and, I think, morality. I just 

find it horribly offensive and outrageous conduct, I really do. I spent 5 

years on a community bank board, 5 years on a hospital board, I have 

been a small business owner for 20 years. I understand the importance of 

keeping proprietary information proprietary, but to go to this level to try 

and find out who might be leaking something, there is no excuse for it. 

There just isn’t. 

I agree with my colleagues on this committee. We have a fine piece 

of legislation that will draw a bright line about what is legal and not. 

You know, Congress passed a law that says you can’t find out what 

videos we rent. We need to pass a law, for anybody who questions this 

practice, that it is clear that this is illegal to go find out who I call, when I 

call them and divulge that information. Of course, pretexting goes much 

beyond phone records, as we have, unfortunately, learned in this 

committee, so we need to pass that legislation into law, and we need to 

do it soon. 

I also want to know, are these practices used on other boards in 

America? And some of our witnesses today probably serve on multiple 

boards. I want to know whether these practices of pretexting are thought 

to be okay to go after competitors to find out what they may know or 

who they are talking to. And I am not alleging that HP engages in that, 

but clearly this is a practice that, frankly, 6 months ago I didn’t even 

know existed. I never heard of the word “pretexting,” and I doubt that I 

am alone in that. Because to me, the synonym of pretexting is lying, 

because that is what it is about; I am going to lie to somebody to get the 

personal and private information on somebody else so that I can use it to 

my advantage. And I just think that is unacceptable, it is outrageous, and 

people better come clean about how they have done it and how they are 
13

never doing it again, and then we need to make sure that the law is 

crystal clear. 

Mr. Chairman, I appreciate the work you put into this, and I look 

forward to hearing from the witnesses who will be actually willing to 

testify today. Thank you. 

MR. WHITFIELD. Thank you, Mr. Walden. 

MR. WHITFIELD. At this time the Chairman recognizes the Ranking 

Member of the full committee, Mr. Dingell of Michigan. 

MR. DINGELL. Mr. Chairman, thank you, and thank you for holding 

this hearing. 

This morning we have a fine case study of deceit, dishonesty, 

improper behavior, probably criminal misbehavior, and we have a fine 

display of arrogance, coverup, and probably gross stupidity. 

We have before us today witnesses from Hewlett-Packard, a 

respected American company, to discuss a plumbers’ operation that 

would make Richard Nixon blush were he alive. And calling the folks 

who did or allowed or participated in this “Keystone Kops” is an insult 

of the grossest sort to the original Keystone Kops. 

Hewlett-Packard, as I have mentioned, is a well-respected company 

in the halls of Congress and around the world, appears before us to 

answer for using lies and deception to obtain telephone records and other 

sensitive personal information in order to uncover the source of leaks to 

the press. Now, I have to ask our witnesses, “What were you thinking?” 

Where was the management while this investigation was running 

amok? Why weren’t you paying attention at the briefings, and why 

didn’t you read the reports that raised red flags? 

Where was the Board of Directors? I understand board leaks could 

undermine a company’s planning and curtail frankness at board 

discussions, but the cure here proves to have been far worse than the 

disease; it now poses a severely greater threat to Hewlett-Packard. 

Where was the board leadership and responsibility? 

One interesting thing is where were the lawyers? The red flags were 

waving all over the place raising questions about the legality of 

pretexting, but none of the lawyers stepped up to their responsibilities. 

This morning we are probably going to have a very interesting 

exercise in which witnesses appearing at that crowded witness table 

amongst the lawyers will be taking the Fifth Amendment. One must ask, 

have we here a law which is so obscure, curious or nonexistent that 

lawyers couldn’t tell what was the law? Or that they participated 

actively? Or that they were part of the exercise about which we are now 

having proper complaints? 

Now, I note that the Congress has not stepped up either. What 

happened to this committee’s legislation, H.R. 4943, the Prevention of 
14

Fraudulent Access to Phone Records Act? It came out of this committee 

with a heavy vote, bipartisan participation, under the effective leadership 

of our Chairman and the senior Members on both sides of the aisle, and 

indeed all of the Members. That bill would permit the FTC to seek civil 

penalties against pretexters, and to provide expanded protections to 

customers’ call records. The bill came out, as observed by Ms. DeGette, 

and on May 2, 2006, it was scheduled for consideration on the floor of 

the House of Representatives. In some curious fashion, it disappeared. 

It was pulled from the suspension calendar where it would have passed 

comfortably under expedited process. But without explanation of any 

sort, it has not been heard of or heard from since. Why did this happen? 

Who did it, and why? 

Also, no one in the Administration is stepping up either. I submitted 

questions for the record of this subcommittee’s June 21 hearing asking 

comments from the executive branch, homeland security and law 

enforcement agencies on how the bill could be changed to address any 

concerns that they might have from a national security standpoint. I have 

been informed that the response is being held up--I assume diligently--by 

the Office of Management and Budget, which appears to be another 

black hole. 

I commend the Chairman of the subcommittee for holding 2 days of 

hearings on this matter, it is most important; but hearings are going to be 

a poor substitute if the committee’s bill remains in legislative limbo. I 

suggest that we all should get behind the bill again and see to it that it is 

enacted into law so that perhaps we don’t have so many distinguished 

Americans coming before this committee in the most profound 

embarrassment to take the Fifth or explain in some curious red-faced 

way why they or the entity of which they are a part is engaged in such 

shameful and shameless behavior. 

Thank you very much. 

[The prepared statement of Hon. John D. Dingell follows:] 

PREPARED STATEMENT OF THE HON. JOHN D. DINGELL, A REPRESENTATIVE IN CONGRESS 

FROM THE STATE OF MICHIGAN

 Mr. Chairman, thank you for holding this hearing. We have before us witnesses 

from Hewlett-Packard to discuss a plumbers’ operation that would make Richard Nixon 

blush were he still alive. And calling folks who did this, or allowed this, “Keystone 

Kops” is an insult to the original Keystone Kops. 

 Hewlett-Packard, a company well respected in the Halls of Congress and around the 

globe, appears before us today to answer for using lies and deceptions to obtain telephone 

records and other sensitive personal information in order to uncover the source of leaks to 

the press. I have to ask our witnesses, “What were you thinking?” 

-- Where was management while this investigation was running amok? Why 

weren’t you paying attention at briefings and why didn’t you read the reports that 

raised red flags? 
15

-- Where was the board of directors? I understand board leaks can undermine a 

company’s planning and curtail the frankness of board discussions. But the cure, 

in this case, was far worse than the disease, and now poses a far greater threat to 

Hewlett-Packard. Where was board leadership and responsibility? 

-- Where were the lawyers? There were red flags waving all over the place, raising 

questions about the illegality of pretexting. But none of the lawyers stepped up to 

their responsibilities. 

 Unfortunately, Congress has not stepped up either. What happened to the 

Committee’s legislation, H.R. 4943, the “Prevention of Fraudulent Access to Phone 

Records Act”? That bill would allow the FTC to seek civil penalties against pretexters, 

and provide expanded protections to customer call records. On May 2, 2006, this bill was 

scheduled for consideration on the Floor of the House of Representatives. It was pulled 

from the Suspension Calendar, without explanation, and has not been seen or heard from 

since. Who did it, and why? 

 Also, no one in the Administration is stepping up either. I submitted questions for 

the record of this Subcommittee’s June 21, 2006, hearing, seeking comments from 

Executive Branch homeland security and law enforcement agencies on how the bill could 

be changed to meet any concerns they might have. I have been informed that the response 

is being held up by the Office of Management and Budget. Why can’t I get answers? 

 I commend the Chairman of the Subcommittee for holding two days of hearings on 

this important issue. But hearings will be a poor substitute if the Committee’s bill 

remains in legislative limbo. 

MR. WHITFIELD. Thank you, Mr. Dingell. 

MR. WHITFIELD. At this time I recognize Mrs. Blackburn of 

Tennessee for her opening statement. 

MRS. BLACKBURN. Thank you, Mr. Chairman. I do want to thank 

you for holding the hearing today. 

The Energy and Commerce Committee has focused on the pretexting 

issue this year, as you have heard my colleagues mention in their 

statements, and it appears we were correct to recognize that this subject 

was a problem. 

Today’s inquiry, I believe, will reaffirm our previous work, which 

showed a need for legal clarity regarding pretexting, and we thank our 

witnesses for coming before us today. 

We are not here to serve as judge and jury of HP and their actions; 

their shareholders, the stakeholders and the legal system have that 

responsibility. Our job today is to focus our attention on the action and 

the practice of pretexting. 

Currently, the law regarding pretexting is ambiguous. As 

Mr. Dingell just said, this case does illustrate how some have taken 

advantage of that ambiguity. Ethical behavior is not always something 

that we can regulate. We certainly cannot mandate it, but we certainly 

can punish actions that are both unethical and a violation of others’ 

rights. 

Our committee is correct to be concerned with corporate governance 

and the American corporate culture. The trust and integrity of the 
16

American people toward the American corporate culture and our free 

enterprise system depends on ethical behavior and an element of trust. It 

is with deep regret that we see that there is a violation of that trust. 

I think we ought to be clarifying the concept of pretexting. The term 

sounds innocuous, but the reality is that it is theft, and the act of 

pretexting is purposeful. It is an action meant to deceive, defraud and 

obtain information one is not entitled to have. It is a more modern 

problem, but one this committee has recognized and is working to 

address. 

In January, my colleague Representative Inslee and I introduced the 

Consumer Telephone Records Protection Act of 2006. The bill 

dispenses with the ambiguity in laws governing the action prohibiting 

individuals or entities from fraudulently obtaining another person’s 

telephone records under false pretext, soliciting someone to obtain phone 

records under false pretext, selling phone records or fraudulently 

obtaining under false pretext. Violations would be criminal offenses 

punishable by up to 5 years in prison, and $250,000 in fines for 

individuals and $5,000 in fines for companies, which is a Class D felony. 

These penalties are doubled for an aggravated offense. 

We have passed a similar bill with civil penalties; these bills would 

clearly have penalized those who engage in the sort of behavior we will 

hear testimony about this morning. 

We are already receiving information that numerous companies are 

profiting by using suspect and irresponsible methods to gain access to 

consumers’ telecommunications records. When a Fortune 15 company 

contracts with one of these companies, yes, it gets our attention, and 

rightfully so. 

We want to know who in the company or in the private investigation 

firms came up with the proposal to pretext. Who created and ran the 

Jacob Project, which used suspect methods to gain information from 

media sources? We hope companies aren’t using these methods to 

engage in corporate espionage to gain a competitive advantage over other 

companies or over innovators or other creators, but we do want to know 

how pervasive is this practice in America’s corporate boardrooms. Are 

there other companies that are using pretexting for other reasons? 

I look forward to the testimony today. I hope we learn that HP is no 

longer using the services of the companies to monitor their Board 

members or the employees, or, just as concerning, using these tactics to 

monitor or spy on other companies. 

Thank you, Mr. Chairman, I yield back. 

MR. WHITFIELD. Ms. Schakowsky of Illinois is recognized for her 

opening statement. 
17

MS. SCHAKOWSKY. Thank you, Mr. Chairman and Ranking 

Member, for holding today’s hearing on Hewlett-Packard’s pretexting 

scandal. I am glad that we have the opportunity to further examine what 

is undoubtedly the most notorious case of pretexting for personal phone 

records to date. 

In July 2005, I circulated a letter to my congressional colleagues 

drawing attention to the burgeoning practice of pretexting of phone 

records. I urged them to join me as cosponsors of the SAFECALL Act, 

which is a somewhat tortured acronym for Stop Attempted Fraud Against 

Everyone’s Cell and Land Lines Act, a bill that would expressly prohibit 

pretexting for phone records. I am proud that my bill was used as the 

basis for title 1 of H.R. 4943, the Prevention of Fraudulent Access to 

Phone Records Act, which passed our committee unanimously. We 

drafted the bipartisan H.R. 4943 because questions were raised about 

whether pretexting for phone records was legal, not to mention the safety 

and privacy concerns that it raises. 

The FTC had successfully brought pretexting cases under its Section 

5 authority which prohibits unfair or deceptive acts and practices. You 

would have thought that that would have set the stage for understanding 

that this is not a legal act. A number of States, including my home State 

of Illinois, under our Attorney General Lisa Madigan, used their general 

consumer protection and consumer fraud statutes to file suits against the 

practice, and now, along with 11 other States, Illinois has passed a law. 

But obviously there are still those who missed the point and choose to 

dabble in what they claim is a grey area of the law. 

We need to pass H.R. 4943, and maybe instead of naming post 

offices for the rest of--most of today, we can do it before we recess. 

Hewlett-Packard is a perfect example. When Kevin Hunsaker, HP 

Senior Counsel and Director of Ethics, asked whether pretexting for 

board members’ and reporters’ phone records was, quote, “above board,” 

unquote, Tony Gentilucci, HP’s Investigations Manager, replied, quote, 

“I think it is on the edge, but above Board,” unquote. Hunsaker, instead 

of demanding an explanation or ringing the alarm bells, responded, 

quote, “I shouldn’t have asked,” unquote. 

Additionally, HP’s September filing with the FCC revealed that the 

Board was advised by its outside General Counsel Larry Sonsini that 

pretexting for phone records was, quote, “not generally unlawful,” 

unquote. The filing went on to say, “but such counsel could not confirm 

that the techniques employed by the outside consulting firm and the party 

retained by that firm complied in all respects with the applicable law,” 

unquote. 
18

Hewlett-Packard’s action and hedging about pretexting’s legality 

demonstrates just how pressing it is to pass our bill to put an end to all 

questions. 

As I said, Congress and at least 12 States that have passed 

antipretexting laws agree that pretexting is unacceptable, and that the 

ends, in HP’s case it was squelching Board leaks, do not justify the 

means. 

What makes the HP story more disheartening was HP was believed 

to be a corporation that set business standards that others should follow. 

In January 2005, HP was named the most trusted company in America 

for privacy. In July 2006, the Commerce, Trade, Consumer Protection 

Subcommittee, of which I am the Ranking Member, invited HP to testify 

about what it does to raise the bar on consumer privacy protections. 

Little did we know that when we were trying to learn about its best 

practices, HP had just been engaging in the worst practices out there. If 

corporations that are supposed to be so reputable are employing such 

legally and ethically questionable behavior--I would argue actually that 

the case is settled--we have to ask what other corporations are doing. 

So I very much look forward to hearing from today’s witnesses. I 

wish all of those that were called today would fully testify. And I truly 

hope that we can get to the bottom of this scandal. Thank you. 

MR. WHITFIELD. The Chair recognizes Mr. Barton of Texas, who is 

Chairman of the full Energy and Commerce Committee. 

CHAIRMAN BARTON. Thank you, Chairman Whitfield. Thank you, 

Ranking Member Stupak, for continuing this investigation. 

We are convened here to examine the facts of the Hewlett-Packard 

pretexting scandal. Pretexting is the use of deception to discover who 

you have been on the phone with, and maybe even where you were. In 

plain language, it is pretending to be somebody you are not to get 

something you probably shouldn’t have to use in a way that is probably 

wrong. 

We have been investigating it because most Americans believe that 

their phone records are theirs, that their private property should only be 

accessed with their permission. 

Pretexting first came to this subcommittee’s attention when it was 

reported that the Chicago Police Department, of all people, had warned 

undercover police officers that suspicious drug dealers could expose 

them just by poking through their phone records. Months of 

investigations and hearings produced plenty of troubling facts and even 

some news. Now today at this hearing it is global news, as you can see 

all the cameras and reporters that are in the room, because nobody would 

have guessed that such a great company as Hewlett-Packard, one of the 

first high-tech companies in the United States, would employ the 
19

methods of pretexting that are sometimes used to chase after cheating 

spouses in order to stalk its own Board members, and believe it or not, 

even tail journalists. 

But against what standard should Hewlett-Packard’s conduct be 

measured? I guess the best place would be a quote from an e-mail 

written by a Hewlett-Packard security employee on August the 23rd of 

this year. The subject line of that e-mail reads, “Standards of Business 

Conduct,” and the author writes, and I quote, “This investigation will be 

a defining case which will test the company’s claim of having 

uncompromising integrity,” end quote. I should say so. 

This hearing is going to examine a year-long course of questionable 

conduct led by Hewlett-Packard’s Chairman of the Board and reviewed 

by Hewlett-Packard’s General Counsel, who I am told has resigned this 

morning, or has announced that she is going to resign. That conduct 

included, among other things, obtaining personal phone records through 

pretext, physical surveillance, monitoring of employees’ instant 

messaging over the Internet, planting spyware or attempting to plant 

spyware on a journalist’s computer, and even planning to put spies in 

newsrooms. 

I think it will be some time before the American corporate icon of 

Hewlett-Packard can reclaim its mantle, self-imposed, but again, 

“uncompromising integrity,” end quote. The public, Hewlett-Packard 

shareholders, and this committee are all very concerned that such a great 

company has strayed off course. And I have to say that as alarming as 

these details that have been disclosed are, I wonder if Hewlett-Packard 

would have and could have done more to right the ship. The company 

seems paralyzed. 

On September the 6th of this year, HP publicly disclosed to the 

Securities and Exchange Commission that the company had obtained 

personal phone records procured through pretext as part of an effort to 

find an individual who was leaking confidential information. Records 

provided to this committee show that phone records were being pulled by 

HP’s internal investigation team for more than a year, with the approval 

and knowledge of both then-Chairman Dunn and General Counsel 

Baskins. 

It is my understanding that the day-to-day operations were controlled 

by the company’s lead ethics attorney Kevin Hunsaker so that the 

investigation could be protected by the attorney/client privilege. Mr. 

Hunsaker would frequently report to Ms. Dunn and to Ms. Baskins about 

the developments in the next steps in the investigation. Yet not until last 

Friday, September the 22nd, did HP force Patricia Dunn’s resignation. 

I also have to say that I am troubled to find that the Board’s outside 

counsel Larry Sonsini learned last April that the investigation included 
20

information from fraudulently obtained phone records. Why didn’t he 

immediately recommend putting the brakes on the investigation? Did he 

ask any questions about the investigative methods employed by 

Ms. Dunn, Ms. Baskins or Mr. Hunsaker? 

On June 28th of this year, instigated by concerns of former Board 

member Tom Perkins, Mr. Sonsini reported to Mr. Perkins that 

pretexting for phone records was, I quote, “a common investigatory 

method,” end quote, and that the, quote, “process was well done and 

within legal limits,” end quote. I hope that Mr. Sonsini will explain to us 

exactly what due diligence he undertook before providing his assessment 

of the legality of pretexting for phone records. And again, pretexting is 

pretending to be somebody you are not to get something you probably 

shouldn’t have to use in a way that is probably wrong. 

By coincidence, just a week before Mr. Sonsini’s e-mail, the Federal 

Bureau of Investigation testified before this same subcommittee about its 

position on the legality of procuring records through pretexting. The FBI 

testified that there are compelling reasons to believe such operations 

violate Federal law, including the Wire Act. In fact, over the next 2 days 

of hearings, we actually expect several other individuals--and several is 

actually--I should say numerous individuals to invoke their Fifth 

Amendment right against self-incrimination, which they are obviously 

entitled to do, and to decline to answer our questions about their 

involvement with pretexting for phone records. It is funny to me that if 

you have to invoke your Fifth Amendment right, you are doing 

something that is illegal. 

I am still waiting for someone to describe a legitimate way, short of a 

subpoena issued by a judge or Congress, to obtain another person’s 

phone records without their permission. 

I would like to close on this note. Whether such activities are 

already illegal or not, this committee has done its part to pass a bill that 

makes it abundantly clear where the Federal government stands 

regarding pretexting for personal records. 

On March the 8th, the Prevention of Fraudulent Access to Phone 

Records Act, H.R. 4943, was unanimously, unanimously reported out of 

this committee. H.R. 4943 would make it illegal to obtain cell phone 

records fraudulently, as well as to solicit or sell such records. I am, of 

course, disappointed by the delays that this bill has experienced since it 

left this committee. It has not yet come to the floor for a vote, but I have 

asked early this week that it be put on the floor as soon as possible. And 

I am going to continue to request that the House of Representatives vote 

on this bill on the floor before the Congress adjourns this year. 

We must make pretexting clearly illegal. There is no room in our 

society for pretexters getting your phone records. If it can happen to a 
21

member of the Board of directors of a Fortune 500 company like 

Hewlett-Packard, it can happen to any of us. 

With that, Mr. Chairman, I yield back. 

[The prepared statement of Hon. Joe Barton follows:] 

PREPARED STATEMENT OF THE HON. JOE BARTON, CHAIRMAN, COMMITTEE ON ENERGY 

AND COMMERCE

 Thank you, Chairman Whitfield. We are convened here to examine the facts of the 

Hewlett-Packard pretexting scandal. Pretexting is the use of deception to discover who 

you’ve been on the phone with, and maybe even where you were. We’ve been 

investigating it because the fact that this can be done and that it somehow seems legal is 

obnoxious to most and downright dangerous to some. 

 It first came to our attention when it was news that the Chicago Police Department 

had warned undercover police that suspicious drug dealers could expose them just by 

poking through their phone records. Months of investigation and hearings produced 

plenty of troubling facts, but even some news. Now it’s suddenly global news, because 

nobody could have guessed that a great enterprise like Hewlett-Packard would employ 

the methods of hired gumshoes chasing after cheating spouses, in order to stalk its own 

Board members and tail journalists. 

 But against what standard should H-P’s conduct be measured? 

 I guess the best place would be with a quote from an email, written by a HewlettPackard security employee on August 23rd of this year. The Subject line of that email 

reads: “Standards of Business Conduct,” and the author writes: “This investigation will 

be a defining case which will test the company’s claim of having uncompromising 

integrity.” 

 I should say so. This hearing will examine a year-long course of questionable 

conduct led by the company’s Chairman of the Board and reviewed by H-P’s General 

Counsel. That conduct included, among other things, obtaining personal phone records 

through pretext, physical surveillance, monitoring of employees’ instant messaging, 

planting spyware on a journalist’s computer, and even planning to put spies in 

newsrooms. Mr. Chairman, I think it will be some time before this American corporate 

icon can reclaim the mantle of “uncompromising integrity” again. 

 The public, H-P’s shareholders, and this Committee are all very concerned that the 

company has strayed far off course. And I have to say that, as these alarming details 

have been disclosed, I wonder if H-P could have done more to right the ship. Until 

recently, a company known for innovation and agility seemed paralyzed. 

 On September 6, 2006, H-P publicly disclosed to the Securities and Exchange 

Commission that the company had obtained personal phone records procured through 

pretext, as part of an effort to find an individual who was leaking confidential business 

information. Records provided to this Committee show that phone records were being 

pulled by H-P’s internal investigation team for more than a year, with the approval and 

knowledge of both then Chairman Dunn and General Counsel Baskins. It is my 

understanding that the day-to-day operations were controlled by the company’s lead 

ethics attorney, Kevin Hunsaker, so that the investigation could be protected by the 

attorney-client privilege. Mr. Hunsaker would frequently report to Ms. Dunn and Ms. 

Baskins about the developments and the next steps in the investigation. Yet not until last 

Friday, the 22nd of September, did H-P force Patricia Dunn’s resignation. 

 I also have to say that I am troubled to find out that the Board’s outside counsel, 

Larry Sonsini, learned last April that the investigation included information from 

fraudulently obtained phone records. Why didn’t he immediately put the brakes on H-P’s 
22

investigation? Did he ask any questions about the investigative methods employed by 

Ms. Dunn, Ms. Baskins, or Mr. Hunsaker? 

 On June 28th of this year, instigated by the concerns of former Board member Tom 

Perkins, Mr. Sonsini reported to Mr. Perkins that pretexting for phone records was “a 

common investigatory method” and that the “process was well done and within legal 

limits.” I hope that Mr. Sonsini will explain to us exactly what due diligence he 

undertook before providing his assessment of the legality of pretexting for phone records. 

 By coincidence, just a week before Mr. Sonsini’s email, the Federal Bureau of 

Investigation testified before our Subcommittee about its position on the legality of 

procuring records through pretext. The FBI testified that there are “compelling reasons” 

to believe such operations violate federal law, including the Wire Act. In fact, over the 

next two days of hearings, we actually expect several individuals to invoke their Fifth 

Amendment right against self incrimination – as they are obviously entitled to do – and 

decline to answer our questions about their involvement with pretexting for phone 

records. I am still waiting for someone to describe a legitimate way – short of a 

subpoena – to obtain another individual’s personal phone records. 

 I would like to close on this note, Mr. Chairman. Whether such activities are 

already illegal or not, this Committee has done its part to pass a bill that makes it 

abundantly clear where the Federal government stands regarding pretexting for personal 

phone records. On March 8th, the “Prevention of Fraudulent Access to Phone Records 

Act,” (H.R. 4943) was unanimously reported out of this Committee. H.R. 4943 would 

make it illegal to obtain cell phone records fraudulently, as well as to solicit or sell such 

records. I am of course disappointed by the delays, but will continue to push the House 

leadership to get our bill to the floor for a vote this Fall. We must make pretexting 

clearly illegal. There is no room in our society for pretexters getting your phone records. 

If it can happen to a member of the board of directors of a Fortune 500 company, it can 

happen to any of us. 

 I yield back. 

MR. WHITFIELD. The gentlelady from Wisconsin, Ms. Baldwin, is 

recognized for 5 minutes. 

MS. BALDWIN. Thank you, Mr. Chairman. 

Unfortunately, it has taken this Hewlett-Packard boardroom spying 

scandal to make pretexting a household word. 

Pretexting is simply a fancy term for lying and deceiving. 

Regrettably, this type of private invasion will now be associated with the 

HP way, a once proud reputation of the highest integrity and ethical 

standards now tainted. 

The committee’s investigation so far has turned up a textbook case of 

exactly how not to operate as a corporate board. Bickering and division 

between HP’s Board members created an atmosphere of antagonism and 

mistrust. 

Investigation into the source of boardroom leaks concerning what 

appears to be rather benign, albeit confidential company information 

were authorized against at least seven Board members, nine journalists 

and two HP employees, as well as some of their relatives. Unsavory 

techniques, including pretexting phone records, trafficking of Social 

Security numbers, a sting operation through a fictitious person, tracer 
23

spyware, physical surveillance, the planting of undercover operatives, 

even the search of individuals’ trash at home may have been employed 

during this investigation. 

Despite the involvement of teams of lawyers specializing in 

corporate ethics, events of the investigation code-named Kona 1 and 

Kona 2 unfolded like the plot of a third-rate detective novel. The laundry 

list of inappropriate investigative conduct, lax oversight and poor legal 

advice will be further explored today. But even when the dust settles, 

when we get to the bottom of who knows what when, an impression of 

corporate America turned rogue spying operation will persist in the 

minds of the public. It is one of the highly unfortunate consequences of 

HP’s conduct. People will wonder how many companies hire third-party 

investigators to spy on their own employees, Board members or outside 

contacts. They will wonder how their own phone records could be 

obtained by their employers under false pretenses, or how their Social 

Security numbers could be unscrupulously shared with strangers, and 

how their e-mails could be embedded with spyware, secretly mining 

personal information. 

HP, known for durable high-tech products, has now given us another 

lasting artifact, the perception of corporate America as our next Big 

Brother. Still, one silver lining of this scandal is that the public is now 

much more aware of the concept of pretexting. 

I believe pretexting in the wireless industry is only the tip of the 

iceberg; therefore, a comprehensive legislative approach is necessary to 

cover all sectors where pretexting is a possible method to breach 

personal data security. 

Our committee has worked diligently and in a bipartisan manner to 

pass legislation that would outlaw the specific tactics involved in the HP 

scandal. And I would further urge criminalization of pretexting to 

encompass the full spectrum of telecommunications and communication 

services, including records obtainable from calling cards and Internet 

websites. The protection of consumers’ fundamental rights to privacy 

simply cannot rely on patchwork policymaking. 

Now, make no mistake, I believe that existing law covering unfair 

and deceptive business practices already prohibits pretexting, but if 

corporate America desires further guidance on whether highly unethical 

behaviors are indeed legal or illegal, as demanded by some of the 

witnesses testifying before us today, our committee should provide 

assistance by enacting clear and overarching bright line rules to outlaw 

such behavior once and for all. 

When Dr. George Keyworth, one of the subjects of the leak 

investigation, was confronted with the results of the probe during a 
24

Board meeting, he reportedly exclaimed, and I quote, “I would have told 

you all about this. Why didn’t you just ask?” 

It seems that HP could have easily avoided this whole mess by 

applying the most basic principles of transparency and common sense. 

For working Americans in 2001, the scandal surrounding Enron 

challenged their trust in the markets. Today the HP scandal is shattering 

their expectations of telecommunications privacy. HP has led the Nation 

on an expedition into corporate intrigue. As they were trying to contain 

the damage, the public deserves to know what steps will be taken not 

only to restore confidence in this company, but also to shore up the 

boundaries of privacy breached by the scandal. 

Thank you, Mr. Chairman. 

MR. WHITFIELD. Thank you. 

The Chair recognizes the gentlemen from Texas, Dr. Burgess. 

MR. BURGESS. Thank you, Mr. Chairman. And thank you for 

continuing your leadership in investigating this important issue. 

Today’s hearing is, unfortunately, additional evidence of the 

deceptive practice of pretexting. I am confident that our committee will 

continue to work diligently to protect the American public and their 

private records. The war on privacy is fully engaged, and we need to 

provide consumers with additional protections. 

Pretexting, as Chairman Barton told us, is the impersonation of 

others to gain access to others’ personal information, probably crossing 

some legal line, but we all learned from an early age that prying is 

wrong, and I don’t understand how an intelligent board from a venerable 

old company in this country could not know that these deceptive actions 

were wrong. Even if you somehow believed that what you were doing 

wasn’t completely illegal, the questions you asked shows that reasonable 

minds would still view these actions as completely out of bounds. 

Others on this panel have already asked, “What in the world were you 

thinking?” 

The past 2 years your company even won awards such as the most 

trusted company for privacy award, and that is--you are supposed to be 

celebrating your respect for people’s privacy and encourage a safer 

digital marketplace. Your business model depends upon the public’s 

trust in a digital marketplace. 

While Hewlett-Packard’s headlines have brought the issue of 

pretexting in the public eye, this committee has been working on the 

matter for much of this year. In fact, this past spring the Energy and 

Commerce full committee marked up comprehensive legislation--you 

have heard others reference it, H.R. 4943--that will make pretexting for 

telephone records illegal and will strengthen security measures taken by 

telecommunications carriers to protect such records. Perhaps a silver 
25

lining to this cloud is that the questionable actions will be a call to action 

to get this important legislation passed. 

You have heard plenty of questions from, in fact, both sides of the 

dais. You know, a lot of people in this country, myself included, worry 

about outsourcing, worry about sending American jobs and 

manufacturing overseas. But at the same time, these types of actions--

and you have heard people reference it this morning--we may be forced 

to add additional regulatory layers trying to legislate the corporate board 

to simply behave responsibly, a Sarbanes-Oxley for ethics, if you will. I 

shudder to think what that will look like. But it begs the question, how 

widespread is this practice; how entrenched is this practice in corporate 

boardrooms in this country? 

And you have to worry about the collateral damage. You have 

140,000 employees worldwide, 57,000 in this country, almost 10,000 in 

my home State in Texas, 200 in my home district in north Texas. What 

about the responsibility to those employees? What about the 

responsibility to the shareholders, not just direct shareholders, but all 

those people hold mutual funds, 401(k)s, exchange trading funds, Thrift 

Savings Plan programs? Hewlett-Packard is a big player in all of those. 

And then finally, you heard it referenced already, the violation of the 

public trust. Again, the war on privacy is fully engaged from several 

sectors in our society. And, Mr. Chairman, I hope that we can encourage 

others in the Congress to get our bill to the House floor and give 

consumers at least one more tool to fight back. 

And I yield back the balance of my time. 

MR. WHITFIELD. The reason we are hesitating for a moment, we 

have some Members here today who are not members of this 

subcommittee, and there are members of the full committee. We are 

going to ask unanimous consent for them to be able to make a brief 

statement, but we want to get through the subcommittee first. 

And the Chair recognizes Mr. Stearns of Florida. 

MR. STEARNS. Thank you, Mr. Chairman. And of course we all 

appreciate this hearing. 

We are holding the hearing obviously to investigate the disclosure 

that investigators hired by Chairwoman Patricia Dunn used pretexting to 

obtain the phone records of directors and journalists during the 

investigation into company media leaks. 

Having been through the Enron oversight hearing, Mr. Chairman, 

there are some similarities here, but this is unique, I thought. Truth is 

stranger than fiction in this case. The evidence we have seen shows that 

this investigation is part Keystone Kops, it is part Mission Impossible, 

and perhaps part of All the President’s Men, all tied together. 
26

I think, Mr. Chairman, if we ask Ms. Dunn if she thought she was 

guilty, she would probably say, I was not. She would make the case that 

she went to the lawyers, and the lawyers told her what she is doing is 

acceptable, is legal; and that she continued to do that, so she hired the 

investigators, and they went ahead and used pretexting. 

But I would remind her and others that I remember when Ken Lay 

was here; and Jeff Skilling, of course, testified how he used the cloak of 

cover, Vinson and Elkins. And they all, during the Enron hearing, used 

the same kind of argument, that we have a cloak of cover because we 

talked to legal people. 

Now, when you look at the California Penal Code, which is 538.5, it 

says specifically, prohibits fraudulently obtaining information from a 

public utility. This statute makes it unlawful for any person to transmit 

or cause to be transmitted by means of wire, radio or television 

communication any words, sounds, writings, signs, signals or pictures for 

the purpose of furthering or executing a scheme or artifice to obtain from 

a public utility confidential, privileged or proprietary information, 

customer records, billing records, customer credit data or accounting data 

by means of false or fraudulent pretenses. So I think the law is that you 

can’t use fraudulent means. 

Obviously if you went ahead and did pretexting on Michael Dell of 

Dell Computers, and you got his last 500 calls, would you say that you 

had the right to do that, Ms. Dunn? I don’t think you would, and I don’t 

think Michael Dell would appreciate that. So in many ways I don’t think 

you can hide behind the cloak of cover of your legal team, and you must 

take personal responsibility. 

But the impetus for this hearing perhaps has much larger impact here 

in this country. I believe pretexting should be illegal in any context, 

financial or otherwise. The action by the Hewlett-Packard officials were 

unconscionable, but make no mistake, the recent events surrounding it 

are just symptoms of, I say, a much bigger problem. 

Obviously the question would come, what did she know and when 

did she know it? But another question is for Michael Hurd. Can he say 

he knew nothing about this? He was advised, I think, by e-mail. Can he 

also say, “Gee whiz, I am just out of the picture here?” He is a Chief 

Executive Officer and now Chairman, and certainly when Ms. Dunn 

notified him either by e-mail or by voice or whatever, he did nothing; he 

just sat there and said, go ahead. Because he could have said to her, 

“What are you going to do, who are the investigators, and are they going 

to do something that is fraudulent here?” So I think he has a certain 

amount of responsibility and culpability here, and shares it with Patricia 

Dunn. 
27

The growing market for personal information is enormous, and many 

of us have seen this, and that is why we need to pass legislation to stop 

this. I chair a subcommittee called Commerce, Trade and Consumer 

Protection. We have amassed extensive records on these issues. I have 

introduced H.R. 4727, the Data Accountability and Trust Act, which is 

designed to improve data security and attack the scourge of 

privacy-infringing practices like pretexting, that continue to be exploited 

on the Internet. The Data Act will go a long ways to protecting the 

privacy of all Americans, and I urge its passage. Our committee, you 

know, has also been involved with other hearings dealing with privacy. 

So in a larger sense, Mr. Chairman, we in Congress have to step up 

to the plate, pass not only the Data Act, which came out of my 

subcommittee and passed the full committee by a unanimous vote 

almost, but we also must go to the heart of this unprecedented assault on 

personal data and, more specifically, on our private lives. And thank 

you, Mr. Chairman. 

MR. WHITFIELD. The Chair recognizes the gentleman from 

Washington, Mr. Inslee, for his opening statement. 

MR. INSLEE. Mr. Chairman, we are all disturbed in our unique way. 

I learned about this last Christmas when I was surfing the Web reading 

some bloggers about people who will sell your personal records on the 

Web for a hundred bucks, and I was astounded that this was going on. 

And at the time I had this sense that what was going on was there was 

this sort of underworld of these scoundrels and sleazes that are operating 

in the dark recesses of American society who are using pretexting to sell 

your phone records on the Internet. And the thought that a major league, 

respected company like HP would be involved in that just never, never 

crossed my mind, and that is what is so disturbing to me. 

We immediately, in January of this year, Marsha Blackburn and 

myself, introduced a bill to make this, to close any possible ambiguity 

about this, to make sure these are criminal violations, and now this 

committee has, in fact, passed a bill that will give the Federal regulators, 

the FTC and the FCC, the tools they need to make sure that nobody does 

this, whether it is an HP or whether it is one of these lowlife scoundrels. 

But I have to say there is another sort of, if not scandal, at least great 

disappointment here. We have now known about this since last 

Christmas, and Americans today at this late date do not have protections 

against pretexting. Neither has the loophole or any ambiguity been 

closed, nor has the bill that this committee basis--on a bipartisan--passed 

to give the regulators the tools and a tool box to put a hammer to it and 

stop it. 

Now, I want to commend Chairman Barton for his work on this and 

some of my Republican colleagues, but I have to tell you, it isn’t just the 
28

leadership failure in HP, there has been a leadership failure in the GOP in 

getting this job done. And I would like to know who in the GOP 

leadership has their foot on this bill that has put it on ice? We passed it, 

it was scheduled to be on the floor in May under Chairman Barton’s 

leadership, we passed it in this committee in March, and nothing 

happens. That is a story here, too, that I would like to get to the bottom 

of. And while we are rightfully dumping every outrage we can on HP 

leadership, HP leadership may look back up here at the GOP leadership 

and say, how come you are not moving this bill? I have talked to the 

Intelligence Committee to see if they have got some hold on it. No 

problems there. So who is the little secret force here that has got control 

of this Congress that is stopping us from passing a bill to stop pretexting? 

I would like to know who that is, and I would like an answer from GOP 

leadership why they are not moving this bill. 

And I also hope today that we learn some more about how deep this 

is. I join my colleagues in wanting to know whether or not HP, if they 

did this to their own, what are they doing to their business competitors? 

I would like to know if this is a deeper situation that is going on, because 

this is clearly not the act of just one rogue employee. It does appear to 

be a widespread, concerted effort on multiple fronts to violate people’s 

personal privacy, and we would like to know where it is so that we can 

get the job done. 

I will tell you one thing I hope comes out of this hearing. I hope the 

message is delivered to the leadership of the House of Representatives to 

pass this bill in the next 24 hours. We can have this on the suspension 

calendar tomorrow night so we can pass this bill and not have to wait 

until some lame-duck session. And I hope that that is one thing that 

comes out of this committee hearing. Thank you. 

MR. WHITFIELD. The Chair recognizes the gentleman from New 

Hampshire for his opening statement, Mr. Bass. 

MR. BASS. Thank you, Mr. Chairman. And I appreciate you holding 

this hearing. 

A couple of observations. First of all, I think we agree on both sides 

of the aisle here that H.R. 4943 should be brought to the floor of the 

House and passed. I hope that what we have gathered from the 

information that we receive in this hearing is not so much who did what, 

where, when, how and to who, but rather whether agreeing that the 

process that--or the events that unfolded at Hewlett-Packard were 

not good, were not right, and probably not lawful, but how we can apply 

this issue to the legislative measure before us today, and whether or not 

the witnesses that are testifying today feel that the bill that we wish to 

have voted upon on the floor of the House is adequate to address the 
29

problem and prevent future occurrences like this from happening; or 

whether or not we need to address the issue in a broader fashion. 

I think this is a helpful hearing to the subject at hand, and I look 

forward to hearing the testimony of the witnesses. 

Thank you, I yield back. 

MR. WHITFIELD. I believe all members of the subcommittee now 

have given their opening statements, and last night we were approached 

by two members of the full committee who wanted to make an opening 

statement. So I am going to ask unanimous consent that those two, 

Ms. Eshoo, who represents Palo Alto, be recognized for 3 minutes for 

her opening statement. And unless there is objection--and Mr. Otter, do 

you want--do you want to make an opening statement, as well? Okay, so 

Mr. Otter and Ms. Eshoo and Mr. Markey for 3 minutes and without 

objection, I will recognize Ms. Eshoo for her opening statement. 

MS. ESHOO. Thank you, Mr. Chairman for allowing me to be a guest 

of the subcommittee this morning, as a member of the full Energy and 

Commerce Committee. This is obviously for the people of my 

Congressional district, including thousands of HP employees, a sad day 

for us. 

HP is headquartered, as you all know, in Palo Alto. The meaning of 

the words, Palo Alto is tall tree. And that is what HP has been from its 

earliest days to this new part of a new century. It is headquartered in 

Palo Alto, employs thousands of my constituents, decent people who 

have helped to lift up this company that has made enormous 

contributions to the American economy. 

HP is really the seminal company in Silicon Valley. It is the 

progenitor of so much that has followed. The two gentlemen that 

founded the company, Bill Hewlett and David Packard, changed our 

region. Silicon Valley--and those that come from the area are privileged 

to live there--know that we would not be what we are were it not for the 

billions of dollars that they have placed in trust funds that have improved 

health care for Lucille Packard Children’s Hospital to countless, 

countless efforts that have made our region really the envy of so many 

places in the United States, and in the world. 

So we are here on a troubled day, and deeply troubling, things have 

taken place. 

There is an irony, in my view, about all of this concern about 

surveillance. I am not here to defend anything that isn’t defensible. But 

the irony today is--I think it is an irony--that on the floor of the House, 

we are going to be considering the Administration’s domestic 

surveillance bill, where FISA is essentially being overthrown, removed. 

And a whole new set of issues, and the American people better get set for 

surveillance. 
30

I would like to point out something that I think the Congress, in 

addition to passing this bill, is going to have to address, and that is, 

where does a publicly held company go when they have a member of 

their board of directors that doesn’t stop talking and damages and walks 

away from not only the credibility of the company, but also their 

fiduciary responsibility? 

I think it is something that needs to be addressed. And I have some 

questions about it-- 

MR. WHITFIELD. The gentlelady’s time has expired. 

MS. ESHOO. I welcome everyone here and thank you, Mr. Chairman, 

for allowing me to be a guest of the subcommittee. 

MR. WHITFIELD. The gentleman from Idaho is recognized for 3 

minutes. 

MR. OTTER. Thank you very much, Mr. Chairman, and I appreciate 

very much the unanimous consent waiver that you have given to us 

nonmembers of this subcommittee. But I am here more today, I suspect, 

out of curiosity than the seeking, the actually seeking of information. 

And my curiosity runs in a couple of veins, and I think it was just 

mentioned by the lady from California--whether or not we can really 

establish in this Congress in this government, the moral high ground in 

order to sit in judgment, write rules and regulations about activities in the 

private sector that we don’t enjoy the same control over in the public 

sector. 

And, so, whether it is, and I fully understand the gravity in the 

difference in the situations. However, the process is no different. People 

have an expectation of privacy. They should enjoy their privacy. Yet we 

find out a very strong urgent message coming from our own Justice 

Department about how perhaps that privacy is not so dear as when the 

security of our government is being threatened. 

So I am looking forward with some curiosity as to how we are going 

to maintain in light of some of the activities of the National Security 

Agency and other agencies of our government, that have been questioned 

in the recent past and how easily we are going to sit on the bench in 

judgment of another who is simply trying to protect the security, and 

bear in mind, Mr. Chairman, I am not condoning any of this activity. I 

condemn it just as bad in the private sector as I do in the government. So 

my curiosity is going to keep me in this seat for as long as I can stay with 

you, Mr. Chairman and thank you for the time. 

MR. WHITFIELD. Thank you, Mr. Otter. The gentleman from 

Massachusetts, Mr. Markey, is recognized for 3 minutes. 

MR. MARKEY. Thank you, Mr. Chairman. The upshot of the HP 

snooping and spying program is the compromise of personal privacy for 
31

two HP employees, nine reporters, seven members of the HP Board, and 

various family members of the same. 

It involved illegal pretexting of phone numbers, Social Security 

numbers, sifting through garbage, and electronic enticements to at least 

one reporter to download malicious software willingly. 

What has happened to our corporate culture? You used to ask a 

company chieftain who does your PR? Who does your advertising? 

Now, do we have to add the question, so who does your spying? That is 

what the whole area has opened up. All of this from a company on its 

website that says HP and its subsidiaries respect your privacy and are 

committed to protecting it. 

Today, the subcommittee will be exploring the responsibility of 

Hewlett-Packard’s management for this illegal spying operation. Who 

authorized the spying operation? Who oversaw it? What were they 

thinking? 

I am very concerned that HP may be suffering from Sergeant Schultz 

syndrome, some in a position of authority are now saying, I heard 

nothing, I saw nothing, I knew nothing. That is their defense. 

It is not believable. 

Where were the lawyers when all this was happening? HP has an 

experienced in-house legal staff as well as access to experienced outside 

legal counsel. Where were these legal professionals when this spying 

program was put into place? 

Mr. Chairman, some are suggesting that there are ambiguities in 

existing law which made it difficult for HP and its attorneys to determine 

what the applicable law in this area really was. This is absolutely absurd. 

What happened is already illegal. 

Section 5 of the Federal Trade Commission Act has long prohibited 

pretexting. In May of this year, the Federal Trade Commission brought 

five court complaints charging Internet information brokers with illegal 

trafficking and consumers telephone number. It is already illegal. 

The Telecommunications Act of 1996 added a new Section, 222 to 

the Communications Act; Section 222 clearly states that customers’ 

phone records can only be disclosed to the customer or to someone else 

with the permission of the customer. I know that because I was 

co-author of that legislation. And the wire fraud statute also prohibits 

that kind of a practice-- 

MR. WHITFIELD. The gentleman’s time has expired. 

MR. MARKEY. I thank the Chairman. Either this is the tip of the 

iceberg or it is the iceberg. If it is the iceberg, then Congress must act to 

ensure that we never again see this as part of corporate culture. 

I thank the Chairman. 
32

MR. WHITFIELD. At this time, the Chair will call forward the 

following witnesses on the first panel and I would ask the staff because 

we have seating assignments there, and I am not sure, it is available to 

everyone, to make sure they are sitting in the right seats. 

But the first witness is Mrs. Ann Baskins, General Counsel for 

Hewlett-Packard; Mr. Kevin Hunsaker, Ethics Counsel for 

Hewlett-Packard; Mr. Anthony Gentilucci, Manager, Global 

Investigations; Mr. Anthony DeLia, Managing Director for Security 

Outsourcing Solutions; Mr. Joe Depante, Owner, Action Research 

Group; Ms. Cassandra Selvage, Owner, Eye in the Sky Investigations; 

Mr. Darren Brost, subcontractor to Action Research; Ms. Valerie 

Preston, subcontractor to Action Research; Mr. Bryan Wagner, 

subcontractor to Action Research; and Mr. Charles Kelly, subcontractor 

to Action Research. If you all would please come forward and have a 

seat at the table, we would appreciate it. 

Just the people whose name I called will be sitting at the table. If 

there are legal counsel involved we will be introducing them as we move 

forward but just the witnesses that I called will be sitting at the table. 

I apologize about the lack of space. I would say to those participants 

on the first panel, this is an investigative hearing. It is the tradition of the 

subcommittee to always take testimony under oath, and I would ask all 

of you, do any of you have any difficulty or do you object to testifying 

under oath this morning? 

So if you all would please stand and raise your right hand I would 

like to swear you in at this time. 

[Witnesses sworn.] 

Thank you very much. All of you are now under oath. Under the 

rules of the House and the committee, each of you do have the right to be 

advised by legal counsel as to your constitutional rights, and I would ask 

each of you, do you have legal counsel here today? If you do, if you 

would please raise your right hand. 

Okay. Now, Ms. Baskins, would you please give us the name of 

your legal counsel? 

MS. BASKINS. I am represented by Cristina Arguedas. 

MR. WHITFIELD. And Mr. Hunsaker, who is your legal counsel? 

MR. HUNSAKER. Michael Pancer. 

MR. WHITFIELD. And Mr. DeLia, who is your legal counsel? 

MR. DELIA. Mr. Kiernan. 

MR. WHITFIELD. Mr. Depante, who is your legal counsel? 

MR. DEPANTE. Richard Preira. 

MS. SELVAGE. Ms. Van Gelder. 

MR. WHITFIELD. And who is your legal counsel? 

MR. GENTILUCCI. Miles Ehrlich. 
33

MR. BROST. Susie Rebera Ariel. 

MR. WHITFIELD. All right. Thank you for introducing legal counsel. 

Now, Ms. Preston, do you have legal counsel? 

MS. PRESTON. No. 

MR. WHITFIELD. Mr. Kelly? And Mr. Wagner? 

MR. WAGNER. No sir. 

MR. WHITFIELD. At this time, the Chair would recognize 

Ms. Baskins for purposes of making an opening statement, if she so 

desires. 

MS. BASKINS. Mr. Chairman, I have no opening statement. 

MR. WHITFIELD. Turn your microphone on, I am sorry. 

MS. BASKINS. I have no opening statement, Mr. Chairman. 

MR. WHITFIELD. The Chair would then recognize Mr. Hunsaker for 

purposes of making an opening statement. 

MR. HUNSAKER. I have no opening statement, Mr. Chairman. 

MR. WHITFIELD. The Chair would recognize Mr. Gentilucci for 

purposes of making an opening statement. 

MR. GENTILUCCI. Mr. Chairman, I have no opening statement. 

MR. WHITFIELD. The Chair would recognize Mr. DeLia for 

purposes of make an opening statement. 

MR. DELIA. Mr. Chairman, I do not have an opening statement. 

MR. WHITFIELD. The Chair would recognize Mr. Depante for 

purposes of making an opening statement. 

MR. DEPANTE. Mr. Chairman, I do not have an opening statement. 

MR. WHITFIELD. The Chair would recognize Ms. Selvage for 

purposes of making an opening statement. 

MS. SELVAGE. Mr. Chairman, I do not wish to make an opening 

statement. 

MR. WHITFIELD. Chair would recognize Mr. Brost for purposes of 

making an opening statement. 

MR. BROST. Mr. Chairman, I have no opening statement. 

MR. WHITFIELD. Chair would recognize Ms. Preston for the purpose 

of making an opening statement. 

MS. PRESTON. Mr. Chairman, I have no opening statement. 

MR. WHITFIELD. Chair would recognize Mr. Wagner for purposes of 

making an opening statement. 

MR. WAGNER. Mr. Chairman, I have no opening statement. 

MR. WHITFIELD. Chair would recognize Mr. Kelly for purposes of 

making an opening statement. 

MR. KELLY. Mr. Chairman, I have no opening statement. 

MR. WHITFIELD. Chair then, since there are no opening statements, 

would recognize himself for 10 minutes for the purposes of questioning 

the witnesses. 
34

And Ms. Baskins, does she have the exhibit book before her? Would 

someone give Ms. Baskins our exhibit book, please. 

MR. WHITFIELD. I would ask Ms. Baskins to turn to Exhibit 124. I 

think they are numbered there. It is my understanding, Ms. Baskins, 

from Hewlett-Packard’s counsel, that these handwritten notes are yours, 

and the notes dated June 15, 2005 have the heading “Project Kona.” The 

first notes on the page say, “Obtaining phone numbers is a time 

consuming process. Call carriers Nextel, Sprint and use pretext to 

extract info, i.e., I didn’t make the call.” Now this document and others 

show that you were aware that HP was engaging in pretexting, that is 

obtaining personal telephone records through impersonation fraud, and 

deceit as a means of identifying the source of corporate leaks. 

Ms. Baskins, did you honestly believe at the time and do you believe 

today that such conduct is legal, ethical and consistent with the 

Hewlett-Packard way? 

MS. BASKINS. Mr. Chairman I respectfully decline to answer based 

on the rights and protections guaranteed to me by the Fifth Amendment 

of the Constitution of the United States. 

MR. WHITFIELD. So Ms. Baskins, you are refusing to answer all of 

our questions today based on the right against self incrimination afforded 

to you under the Fifth Amendment of the U.S. Constitution? 

MS. BASKINS. Yes, Mr. Chairman. 

MR. WHITFIELD. And it is your intention to assert that right for any 

and all questions that would be asked today. 

MS. BASKINS. Yes, Mr. Chairman. 

MR. WHITFIELD. If there are no further questions from the members 

of the committee, then I would dismiss you at this time? 

CHAIRMAN BARTON. Mr. Chairman, may I be recognized for a 

question? 

MR. WHITFIELD. Yes, sir. 

CHAIRMAN BARTON. Ms. Baskins, is it true that you have resigned 

your position from Hewlett-Packard? 

MS. BASKINS. Yes, Congressman. 

CHAIRMAN BARTON. Thank you. 

MR. WHITFIELD. Then Ms. Baskins, you are dismissed at this time 

subject to the right of the subcommittee to recall you if necessary, and at 

this time, you are excused. 

Mr. Hunsaker, if you would please turn to exhibit in the exhibit book 

there, Exhibit 25. This exhibit shows a January 30, 2006 e-mail 

exchange between you and Anthony Gentilucci. And in his e-mail to 

you, Mr. Gentilucci explains how Ron DeLia procured phone records for 

Hewlett-Packard’s investigation. 
35

“The methodology utilized is social engineering. He has 

investigators call operators under some ruse to obtain the call records 

over the phone.” Mr. Gentilucci later writes, “In essence, the operator 

should not give it out, and that person is liable. I think it is on the edge 

but above board.” And your response was, “I shouldn’t have asked.” 

Mr. Hunsaker if you knew that the phone records being obtained for 

Hewlett-Packard’s investigations were being procured through the use of 

a ruse or deceit, and that the legality and ethics of pretexting might be in 

doubt, why did you permit the use of this practice in the Kona 2 

investigations? 

MR. HUNSAKER. Mr. Chairman on the advice of my counsel I am 

asserting my rights under the U.S. Constitution and will not testify here 

today. 

MR. WHITFIELD. So it is your intent then to assert that right in 

response to any further questions that may be asked today? 

MR. HUNSAKER. That is correct, Mr. Chairman. 

MR. WHITFIELD. If other members of the committee do not have a 

question, then I would dismiss you at this time subject to the right of the 

subcommittee to recall you if necessary, and at this time you are excused. 

MR. HUNSAKER. Thank you, Mr. Chairman. 

MR. WHITFIELD. Mr. Gentilucci, I would ask you in the exhibit 

book to please turn to Exhibit 39. If you all could pass that down to him. 

You will notice that this is an e-mail dated February the 7th, 2006, 

addressed to you from Mr. Vince Nye, who I understand worked for you 

at Hewlett-Packard. 

In this e-mail, Mr. Nye states, “I have serious reservations about 

what we are doing. As I understand Ron’s methodology in obtaining this 

phone record information, it leaves me with the opinion that it is 

unethical at the least, and probably illegal. If it is not totally illegal, then 

it is leaving HP in a position that could damage our reputation, or worse. 

I am requesting that we cease this phone number gathering method 

immediately, discount any of its information. I think we need to refocus 

our strategy and proceed on the high ground.” 

Mr. Gentilucci, despite the ethical and legal concerns expressed to 

you by Mr. Nye, isn’t it true that you continued to utilize pretexting and 

other suspect tactics to obtain confidential information about HP’s 

employees, Board members and journalists? 

MR. GENTILUCCI. Mr. Chairman and other committee members, I 

understand the Constitution of the United States gives me the right not to 

be forced to be a witness against myself. And due to other ongoing 

investigations, I must assert that constitutional right. And I respectfully 

decline to answer the committee’s questions today. 
36

MR. WHITFIELD. So you are asserting yourself Fifth Amendment 

protection against self-incrimination, and it is your intention to assert that 

right in any other questions that may be asked of you today? 

MR. GENTILUCCI. Yes, Mr. Chairman. 

MR. WHITFIELD. If there are no further questions from other 

members of the committee, then I will dismiss you at this time, subject to 

the right of the subcommittee to recall you if necessary, and at this time, 

you are excused. 

MR. GENTILUCCI. Thank you. 

MR. WHITFIELD. At this time, Mr. DeLia, I would ask for you to 

please turn to Exhibit 4. 

In Exhibit 4, in July of 2005, you e-mailed the report to Patricia 

Dunn summarizing your findings in the Kona 1 leak investigation. 

In this report, you state that telephone subscriber and call registers 

are obtained verbally from the various telephone carriers and that the 

investigation into the review of telephone records and the backgrounds of 

BusinessWeek reporters and HP Board members is continuing. 

Mr. DeLia, did you or anyone working for you on behalf of Security 

Outsourcing Solutions engage in pretexting, namely obtaining access to 

someone’s personal telephone records without their consent through 

fraud, deceit or misrepresentation, as part of an investigation by the 

Hewlett-Packard Company into leaks of corporate information during 

2005 and 2006? 

MR. DELIA. Mr. Chairman, I must respectfully decline to answer 

your questions based upon the rights afforded to me by the Fifth 

Amendment of the Constitution of the United States. 

MR. WHITFIELD. And is it your intention to assert your Fifth 

Amendment rights to any further questions to be asked of you today? 

MR. DELIA. Yes, Mr. Chairman. 

MR. WHITFIELD. If there are no further questions from other 

members of the committee, then I dismiss you at this time subject to the 

right of the subcommittee to recall you if necessary, and at this time you 

are excused. 

MR. DELIA. Thank you, Mr. Chairman. 

MR. WHITFIELD. Mr. Depante, if you would please turn to 

Exhibit 109 in the document book. It is the small book, not the large 

book. There is a small book on the table somewhere. Exhibit 109 is a 

request for the private phone records of Mr. Robert Knowling submitted 

to Action Research Group by Security Outsourcing Solutions on July 6, 

2005. It appears that you procured Mr. Knowling’s detailed calling 

record through Eye in the Sky Investigations. 
37

Mr. Depante, did you and your company, Action Research Group, 

obtain and sell to Mr. DeLia, consumers’ personal phone records that 

were obtained through pretexting, lies, deceit or impersonation? 

MR. DELIA. Mr. Chairman, on the advice of counsel, I would invoke 

my Fifth Amendment privilege to decline comment at this time. 

MR. WHITFIELD. And it is your intention to assert that right to any 

additional questions we may have for you? 

MR. DELIA. Yes, sir. 

MR. WHITFIELD. If there are no further questions from members of 

the committee, we will dismiss you at this time subject to the right of the 

committee to recall you if necessary, and at this time, you are excused. 

MR. DELIA. Thank you, Mr. Chairman. 

MR. WHITFIELD. Ms. Selvage if you also would look at Exhibit 109, 

this is a request for the private phone records of Mr. Robert Knowling 

submitted to Action Research Group by Security Outsourcing Solutions 

on July 6, 2005. The second page of this exhibit is an e-mail you sent 

from your Eye in the Sky Yahoo e-mail account. In it, you provided 

Action Research with Mr. Knowling’s detailed calling records, which 

Action Research then passed on to Mr. DeLia. 

Ms. Selvage, did you and your company, Eye in the Sky 

Investigations, obtain and sell to Mr. Depante consumers’ personal 

phone records that you obtained through pretext, lies, deceit or 

impersonation? 

MS. SELVAGE. Mr. Chairman, and members of the committee, I am 

joined here today by my attorney, Ms. Barbara Van Gelder. I am aware 

of several ongoing criminal investigations relating to Hewlett-Packard 

and its security contractors. I am still not aware if I am connected to 

these investigations, or if so, how. 

Given these circumstances and considering the fact that the Fifth 

Amendment protects innocents who might be ensnared by ambiguous 

circumstances as this committee’s subpoena infers I may be, I accept the 

advice of my counsel and respectfully decline to answer any questions 

posed to me today on the basis of the rights guaranteed to me by my 

Fifth Amendment rights. 

MR. WHITFIELD. It is your intention to assert your Fifth Amendment 

rights for any other questions we may have? 

MS. SELVAGE. Yes, sir. 

MR. WHITFIELD. If there are no further questions from committee 

members, then we will dismiss you at this time subject to the right of 

recall if necessary. And at this time you are excused. 

MS. SELVAGE. Thank you, sir. 

MR. WHITFIELD. Mr. Brost, if you would turn to Exhibit 107, this is 

a document from Action Research Group, showing requests made by 
38

Security Outsourcing Solutions to Action Research Group for 

phone-related records as well as the corresponding completed order. 

On page 11 of this exhibit is a handwritten note from you to an 

Action Research employee providing subscriber information requested 

by Security Outsourcing Solutions. 

Mr. Brost, did you obtain and sell to Mr. Depante consumers’ 

personal phone records that you obtained through pretext, lies, deceit or 

impersonation? 

MR. BROST. Most respectfully, on advice of counsel, I wish to 

invoke my Fifth Amendment rights. 

MR. WHITFIELD. And is it your intention to assert your Fifth 

Amendment right on any additional questions we may have? 

MR. BROST. Yes, Mr. Chairman. 

MR. WHITFIELD. If there are no further questions from members of 

the committee I will dismiss you at this time subject to the right of the 

Chair to recall you if necessary, and at this time you are excused. 

MR. BROST. Thank you. 

MR. WHITFIELD. Ms. Preston, if you have the exhibit book and 

document book, on page 3 of Exhibit 107, this is an e-mail from you to 

Action Research Group which provides telephone subscriber information 

requested by Security Outsourcing Solutions. Pages 4 through 7 of that 

document also contain e-mails in which you provided personal phone 

records to Action Research. 

Ms. Preston, did you and your company, In Search Of, Inc., obtain 

and sell to Mr. Depante consumers’ personal phone records and other 

phone-related information that you obtained through pretext, lies, deceit 

or impersonation? 

MS. PRESTON. Mr. Chairman, I respectfully invoke my Fifth 

Amendment right at this time. 

MR. WHITFIELD. And is it your intention to assert that right for any 

additional questions we may have for you? 

MS. PRESTON. Yes, sir, at this time. 

MR. WHITFIELD. Given that, if there are no further questions from 

members of the committee, I will dismiss you at this time subject to 

recall of the Chair if necessary, and at this time, you are excused. 

MS. PRESTON. Thank you. 

MR. WHITFIELD. Mr. Wagner, if you would please turn to Exhibit 

112, this exhibit contains three e-mails that you sent to Action Research 

Group in February, 2006. The first e-mail includes two pages of Marian 

Keyworth’s detailed personal phone records. The second e-mail includes 

two pages of detailed phone records for the landline phone at George and 

Marian Keyworth’s home. The third e-mail includes two pages of 

detailed phone records for the Keyworths’ fax machine. 
39

Mr. Wagner, did you obtain and sell to Mr. Depante consumers’ 

personal cell phone records that you obtained through pretext, lies, deceit 

or impersonation? 

MR. WAGNER. Mr. Chairman, I respectfully invoke my Fifth 

Amendment right. 

MR. WHITFIELD. And is it your intention to assert that right for any 

additional questions we may have for you? 

MR. WAGNER. Mr. Chairman, I feel I have information that could 

help the subcommittee in their quest to make this illegal, but there are 

certain questions that I would not want to answer of course. 

MR. WHITFIELD. But you are asserting your legal right, your Fifth 

Amendment right, for all the questions we may ask today? 

MR. WAGNER. Yes, Mr. Chairman. 

MR. WHITFIELD. If there are no further questions from Members of 

the Committee we will dismiss you. 

CHAIRMAN BARTON. Mr. Chairman, before we let this witness go, 

would you inform the subcommittee of who the Keyworths are, since 

you asked the question. 

MR. WHITFIELD. Yes, well, Mr. Keyworth was a member of the 

Board of Directors of Hewlett-Packard. 

CHAIRMAN BARTON. And he is the one I understand who is alleged 

to have leaked the information? 

MR. WHITFIELD. That’s true. 

And so are you asserting your Fifth Amendment right? 

MR. WAGNER. Yes, Mr. Chairman. 

MR. WHITFIELD. If there are no additional questions from Members 

of the Committee then we will dismiss you at this time subject to the 

right of the subcommittee to recall you if necessary. And at this time 

you are excused. 

MR. WAGNER. Thank you, Mr. Chairman. 

MR. WHITFIELD. Mr. Kelly. If you would please turn to 

Exhibit 111. This is an e-mail that you sent to Action Research Group in 

January 2006. The e-mail includes 3 pages of Dawn Kawamoto’s 

detailed phone records for the entire month of January. And I believe 

that Dawn is a reporter for CNET News. 

Now, Mr. Kelly, did you and your company, CAS Agency, obtain 

and sell to Mr. Depante consumers’ personal phone records that you 

obtained through pretexting, lies, deceit or impersonation? 

MR. KELLY. Mr. Chairman, I respectfully invoke my Fifth 

Amendment privilege to decline comment at this time. 

MR. WHITFIELD. And is it your intention to assert your Fifth 

Amendment rights for any additional questions we may have today? 

MR. KELLY. Yes, sir. 
40

MR. WHITFIELD. If there are no further questions from members of 

the committee, I will dismiss you at this time subject to the right of the 

subcommittee to recall you if necessary, and at this time you are excused. 

MR. KELLY. Thank you. 

CHAIRMAN BARTON. Mr. Chairman? 

MR. WHITFIELD. Yes, Mr. Chairman. 

CHAIRMAN BARTON. I have been on the committee for 20 years, and 

I have been on this subcommittee for over half that time. I have never 

had a hearing where no witness gave an opening statement, where every 

witness took the Fifth. It is odd to me that a practice, that every one of 

the individuals just before us has in various forms indicated was totally 

legal, has invoked their Fifth Amendment right against 

self-incrimination. 

MS. DEGETTE. Will the Chairman yield? 

CHAIRMAN BARTON. I would. 

MS. DEGETTE. I agree with the Chairman and as a former lawyer 

myself, I cherish the right of witnesses to invoke their Fifth Amendment 

right against self-incrimination. It is one of our important constitutional 

provisions. 

But it is very difficult for us in Congress to have an investigation 

where all the witnesses come in, and at the very last minute, inform the 

committee that they are invoking their Fifth Amendment rights. It 

becomes almost the routine rather than the exception. 

And while I, in the corporate responsibility hearings, for example, I 

felt that there were many, many witnesses, some of whom are now in 

Federal prison, who should have invoked their constitutional rights; in 

this case, I would have to agree with the Chairman. 

And furthermore I would say, I know it is not our staff’s faults, but 

when you haul in a whole panel of people like this just to have them take 

the Fifth Amendment, I think it is a waste of the committee’s time and 

resources, and I think it is a waste of the witnesses’ time and resources 

and legal fees. I would hope we would work with witnesses in the future 

to prevent this kind of action. 

CHAIRMAN BARTON. Reclaiming my time, until this morning 

indications were that only two individuals were going to take the Fifth 

Amendment. 

MS. DEGETTE. That is exactly what I am saying, Mr. Chairman. 

CHAIRMAN BARTON. Which they have the right to do, and Mr. 

Chairman, I would encourage you to work with the Ranking Member of 

this subcommittee, the information that has been put together in 

preparation for this hearing is very important. And I would encourage 

you to work with the Minority to make it available, the proper format to 

the general public and to law enforcement authorities that are pursuing 
41

this case in other venues, because both staffs have worked very hard to 

prepare for this hearing. 

We have got voluminous information that I think is accurate and true 

information. And if we are going to put a stake through the heart of 

pretexting, we need to inform the public and make available the 

information that we have obtained, about just how prevalent it is and 

how obnoxious it is. 

MR. WHITFIELD. Thank you, Mr. Chairman. It is certainly our 

intent to do that, and it has been stated before by many of our members 

of the subcommittee and the full committee that it is our desire to move 

this pretexting legislation we reported out, and hopefully, we can do that. 

At this time, I would like to call to the witness table the second panel 

and on the second panel, we have Ms. Patricia Dunn, who is the former 

Chairman of the Board of Hewlett-Packard Company, Palo Alto, 

California. We have Mr. Larry Sonsini, who is the Chairman of Wilson 

Sonsini Goodrich & Rosati from Palo Alto, California. And we have 

Mr. Fred Adler, who is with IT Security Investigations at 

Hewlett-Packard in Palo Alto, California. 

I want to welcome you all to the witness table. 

TESTIMONY OF PATRICIA DUNN, FORMER CHAIRMAN, OF 

THE BOARD, HEWLETT-PACKARD COMPANY; LARRY 

SONSINI, CHAIRMAN, WILSON SONSINI GOODRICH & 

ROSATI; AND FRED ADLER, IT SECURITY 

INVESTIGATIONS, HEWLETT-PACKARD COMPANY 

MR. WHITFIELD. We appreciate very much you all being with us 

this morning, and as you heard in my remarks to the earlier panel, 

Oversight and Investigations, our subcommittee, does take testimony 

under oath and, I am assuming that none of you have any difficulty or 

objection to testifying under oath. 

MR. SONSINI. No objection. 

MS. DUNN. No, sir. 

[Witnesses sworn.] 

MR. WHITFIELD. Thank you very much. You are now under oath, 

and you also understand that it is the rules of the committee and the 

House that you are entitled to legal counsel. And Ms. Dunn, I would ask 

you, do you have legal counsel with you this morning. 

MS. DUNN. Yes, I do, Mr. Jim Brosnahan. He is here this morning. 

MR. WHITFIELD. Thank you. And Mr. Sonsini, I know you are an 

attorney, but do you have legal counsel with you this morning? 

MR. SONSINI. Yes, I do. My counsel is Mr. Evan Chesler. 
42

MR. WHITFIELD. And Mr. Adler, do you have legal counsel request 

with you this morning? 

MR. ALDER. Yes, I do. It is Mr. Malcolm Segal seated directly 

behind me. 

MR. WHITFIELD. Well, thank you very much for, as I said, being 

with us and introducing your counsel, and at this time, Ms. Dunn, we 

will recognize you for 5 minutes for your opening statement. 

MS. DUNN. Thank you, Mr. Chairman and other distinguished 

members of this committee, I do appreciate the opportunity to appear 

before you today. 

All corporate directors have a solemn duty of confidentiality to their 

fellow directors and to the shareholders they serve. Boardroom leaks 

create unfair advantages for some shareholders over others because stock 

prices can move on the unauthorized disclosure of information. 

Leaks corrode the trust that is fundamental to Board functioning and 

expose companies to regulatory sanction under the fair disclosure rules 

of the SEC. When the HP Board asked me to accept the position of 

Nonexecutive Chairman early last year, I expected challenges. But I 

never anticipated that the circumstances currently surrounding HP could 

ever occur. 

One of the first challenges I faced came from requests made by 

directors to continue efforts to identify the source, or sources of leaks 

that were undermining the Board’s functioning. 

I took this mandate seriously, because the leaks touched the very 

heart of the company’s most sensitive issues. 

As detailed in my written testimony, I sought the advice of Bob 

Wayman, the company’s CFO and then acting CEO, whom I respect 

greatly. He was the logical person to consult because all of HP’s control 

functions, including its legal and security groups, reported to him. 

He referred me to Kevin Huska, who had responsibility for global 

security who, in turn, referred me to Mr. Ron DeLia, about which I have 

explained in detail in my written testimony. 

In my two or three conversations with Mr. DeLia over the ensuing 

weeks and months, I learned that checking telephone records was a 

standard investigative technique at HP, and that they were drawn from 

publicly available sources. 

The first leak investigation from April to August 2005 failed to 

identify those responsible, but major new leaks occurred in January, 

2006. These involved another publicly traded company, CSC, whose 

stock price may have been impacted by as much as 8 percent. 

This raised the possibility of securities law violations. Mr. Hurd and 

I concurred that a renewed investigation was in order. Ms. Baskins 

advised on this matter from the start. I recommended that the company 
43

use an outside firm such as Kroll Associates to perform the investigation. 

However, Ms. Baskins felt strongly that the investigation should be 

performed by Kevin Hunsaker, who reported to her and who had 

responsibility for business conduct and ethics investigations. 

Mr. Hunsaker brought in the same underlying investigative team, 

including Mr. DeLia, in the second investigation as had been used in the 

first when Mr. Huska was involved. 

His final draft report was distributed to me and Mr. Hurd in midMarch. 

Throughout the process, as detailed in my written testimony, I 

requested and received assurance that the investigation was being 

performed in the HP standard way, legally, and properly. That this was 

the case was reiterated in Mr. Hunsaker’s final report. 

In April, the report was reviewed by Mr. Sonsini and the Chairman 

of the Board’s Audit Committee, who presented a summary of the report, 

which identified the director responsible for the leaks to the Board in 

May. 

In late June, I became aware from Mr. Sonsini that former director 

Tom Perkins had raised concerns with him about the investigation a 

month or so after he had resigned from the HP Board. Mr. Sonsini 

attempted to allay Mr. Perkins’ concerns after consultation with Ms. 

Baskins, concluding, in a January 28th e-mail that “the process was well 

done and within legal limits.” 

In late August, 2006, Mr. Sonsini advised the Board that its 

techniques were “not generally unlawful.” 

I am neither a lawyer nor an investigator, and in this matter, I relied 

on the expertise of people in whom I had full confidence based upon 

their positions with the company and my years of experience in working 

with them. 

I deeply regret that so many people, including me, were badly let 

down by this reliance. 

I would like you to know that I was a full subject of this 

investigation and I too was pretexted. 

Based on my experience, I hope that Congress will help companies 

like HP and people who find themselves in my position, as well as the 

targets of investigations, by establishing bright line laws in this area. 

In addition to protecting privacy, I hope that Congress enacts 

legislation to help companies protect themselves from threats arising 

from serious or repeated breaches of confidentiality through sanctioned 

legal means perhaps through investigations that can be conducted by the 

SEC. 

I appreciate the opportunity to appear before you and I look forward 

to your questions. 
44

[The prepared statement of Patricia Dunn follows:] 

PREPARED STATEMENT OF PATRICIA DUNN, FORMER CHAIRMAN OF THE BOARD, HEWLETTPACKARD COMPANY
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MR. WHITFIELD. Thank you, very much, Ms. Dunn. 

At this time, Mr. Sonsini, you are recognized for 5 minutes for your 

opening statement. 

MR. SONSINI. Thank you, Mr. Chairman, members of the 

committee. It is an honor to be asked to appear before you today. I want 

to thank my client, Hewlett-Packard, for authorizing me to answer your 
77

questions. I, therefore, believe that I can address the issues presented by 

these hearings without violating any confidentiality obligations that I 

have to them. 

First, let me explain my law firm’s role in these matters. We were 

not involved in the design. We were not involved in the conduct of the 

so-called Kona 1 or Kona 2 investigations. Indeed, I was not even aware 

of them when the investigations were being conducted. 

Hewlett-Packard asked my law firm to provide legal advice to the 

Board of Directors after the investigations had occurred. 

With respect to the subject of your hearing, in my opinion, the use of 

pretexting and similar intrusive investigative methods in these 

circumstances is plainly wrong. They should not be used by businesses 

or others no matter what the purpose. I know this as well as anyone 

since public reports have indicated that my own records may have been 

obtained using pretexting in this investigation. 

When we were asked by the Hewlett-Packard Board of Directors to 

investigate the matter, we told the Board that although generally 

pretexting except in the instances of financial institutions was not 

specifically unlawful, we could not confirm that the methodologies used 

in the investigations were legal. 

It seems to me that a positive outgrowth of the recent troubles at 

Hewlett-Packard would be passage of legislation governing such 

conduct. Although pretexting is clearly wrong, unethical and improper, 

the law is not as clear as it needs to be. As Mr. Chairman said in his 

opening statement, it is probably illegal. We need to make it clearly 

illegal. 

Having said that, the importance of preserving confidentiality within 

the Boardroom should not be minimized. The dominant trend in 

corporate governance in recent years has been to enhance the role of 

boards of directors, the role of not only oversight, but also the obligation 

to monitor management. Boards across the Nation have risen to this 

challenge. But a board cannot function effectively to safeguard the 

shareholders’ interests if its most sensitive deliberations are leaked to 

outsiders. A board’s duty of deliberation, a board’s duty of care, a 

board’s duty of candor is greatly weakened without confidentiality. 

Finally, in all the recent coverage about the disputes within 

Hewlett-Packard, I feel that some have lost sight of the underlying 

greatness of the company involved. The mistakes made in handling the 

investigation--and there were mistakes--do not alter the fact that HP 

remains a company that we can all be proud of. I look forward to 

answering your questions to the best of my ability, and thank you again 

for this opportunity to make this statement. 

MR. WHITFIELD. Thank you, Mr. Sonsini. 
78

 [The prepared statement of Larry Sonsini follows:] 

PREPARED STATEMENT OF LARRY W. SONSINI, CHAIRMAN, WILSON SONSINI GOODRICH &

ROSATI

MR. WHITFIELD. And Mr. Adler, you are recognized for 5 minutes. 

MR. ALDER. Good morning. Good morning, Mr. Chairman and 

members of the committee. My name is Fred Adler. I am with HP IT 

Security Investigations, and I am here at the invitation of the committee. 

No subpoena was required to compel my attendance. My fellow 

employees and colleagues at Hewlett-Packard have encouraged me to 

attend this hearing as have my employers. I believe, as do my friends at 

Hewlett-Packard, that the company has a tradition of being an 

outstanding and ethical member of the community. With the recent 

public disclosure of possible inappropriate conduct, I am sure that 

Hewlett-Packard will become a stronger company. I will be proud to 

continue to work there. 

In order to assist the committee in evaluating my testimony, I would 

like you to know my background. 
79

I spent 28 years working for the California Attorney General’s 

office, Department of Justice, and retired before joining 

Hewlett-Packard. 

The last 13 years at the Department of Justice, I served as a law 

enforcement officer. The last 7 years of my service, I was assigned to 

the Sacramento high technology crimes task force responsible for 

investigating computer-based criminal activity. 

I joined HP after my retirement knowing that many of the people I 

would be working with at HP were former colleagues who had 

outstanding careers in law enforcement investigating technology-related 

issues. 

In the time that I have worked for the company, we successfully 

protected the company, its customers, and vendors from criminal 

activity. 

When requested, we have also assisted law enforcement in 

investigating crimes when our particular expertise was needed. 

I am proud of our record and of our relationship with law 

enforcement. I am proud of the ethical standards that the company has 

set and my maintaining those standards. 

Because of the pride I take in our company, earlier this year I 

became uncomfortable when I learned of investigative techniques being 

used by certain members of the unauthorized disclosure investigation 

team with whom I worked during the investigation of leaks to the press. 

Those leaks had divulged important corporate information. 

In order to appreciate concerns that arose during the investigation, 

one must understand the legal issues surrounding the collection of 

relevant information. 

People who work at Hewlett-Packard, as at other corporations, sign a 

user agreement which permits the company access to data which resides 

on the company network. 

This includes data on desktop computers, laptop computers, e-mail 

accounts, servers and also includes corporate telephone records. 

If so, tasked and specifically authorized, I have access to those 

accounts and can track the pertinent calls, e-mails and contacts for 

investigative purposes. 

In that process, it may be helpful to know the phone numbers or 

e-mail identity of the employee or corporate officer or other key persons. 

The information we use to make our inquiries must comply with 

legal standards. If we wish to obtain third party data, we must, and do, 

comply with the law. As a result of our law enforcement experience, we 

usually know what standards apply. 

In this instance, when we grew concerned that legal standards may 

not have been met in obtaining personal phone records, a coworker and I 
80

brought the matter to the attention of our managers. My manager, a 

former law enforcement officer, appreciated our concerns and raised 

them with counsel. We were all subsequently assured by counsel 

everything being done met both Federal and State legal standards. 

We were advised that this opinion was a result of a review by at least 

two attorneys. 

I understand those opinions have since been questioned. I am not an 

attorney, and I can’t pass judgment on that issue. I do believe as a 

former law enforcement officer, that it is important that the law be as 

clear--be clear, so everyone knows it has its limits. 

If the problem that brought us here today starts the process of 

clarifying the law, some good will have will occurred. HP and its 

exceptional employees will get past this difficult period. It is a strong 

company with loyal customers and clients. 

In the meantime, I am pleased to assist the committee by answering 

questions and providing information, particularly if it helps in passing 

legislation which will clarify the law. Thank you. 

 [The prepared statement of Fred Adler follows:] 

PREPARED STATEMENT OF FRED ADLER, IT SECURITY INVESTIGATIONS, HEWLETTPACKARD COMPANY

 Mr. Chairman and Members of the Committee, my name is Fred Adler, HP IT 

Security Investigations, and I am here at the invitation of the Committee. No subpoena 

was required to compel my attendance. My fellow employees and colleagues at Hewlett 

Packard have encouraged me to attend this hearing, as have my employers. I believe, as 

do my friends at Hewlett Packard, that the company has a tradition of being an 

outstanding and ethical member of the community. From the recent public disclosure of 

possible inappropriate conduct, I am sure that Hewlett Packard will become a stronger 

company. I will be proud to continue to work there. 

 In order to assist the committee in evaluating my testimony, I would like you to 

know my background. I spent twenty-eight (28) years working for the California 

Attorney General’s Office, Department of Justice, and retired before joining Hewlett 

Packard. The last thirteen (13) years at the Department of Justice I served as a law 

enforcement officer. The last seven years of my service I was assigned to the Sacramento 

High Tech Crimes Task Force, responsible for investigating computer based criminal 

activity. I joined HP after my retirement knowing that many of the people I would be 

working with were former colleagues who had outstanding careers in law enforcement 

investigating technology related crimes. 

 In the time I have worked for the company, we have successfully protected the 

company, its customers and vendors from criminal activity. When requested, we have 

also assisted law enforcement in investigating crimes when our particular expertise was 

needed. I am proud of our record and of our relationship with law enforcement. I am 

proud of the ethical standards our company has set and my maintaining those standards. 

Because of the pride I take in our company, earlier this year I became uncomfortable 

when I learned of investigative techniques being used by certain members of the 

Unauthorized Disclosure Investigative Team with whom I worked during the 

investigation of leaks to the press. Those leaks had divulged important corporate 

information. 
81

 In order to appreciate concerns that arose during the investigation, one must 

understand the legal issues surrounding the collection of relevant information. People 

who work at Hewlett Packard, as at other corporations, sign a user agreement which 

permits the company access to data which resides on the company network. This includes 

data on desk top computers, lap top computers, email accounts, servers and also includes 

telephone records. If so tasked and specifically authorized, I have access to those 

accounts and can track the pertinent calls, e-mails and contacts for investigative purposes. 

In that process it may be helpful to know the phone numbers or e-mail identity for the 

employee or corporate officer and other key persons. 

 The information we use to make our inquiries must comply with legal standards. If 

we wish to obtain third party data, we must and do comply with the law. As a result of 

our law enforcement experience, we usually know what standards apply. In this instance, 

when we grew concerned that legal standards may not have been met in obtaining 

personal phone records, a co-worker and I brought the matter to the attention of our 

managers. My manager, a former law enforcement officer, appreciated our concerns and 

raised them with counsel. We were all subsequently assured by counsel everything being 

done met both federal and state legal standards. We were advised that this opinion was 

the result of a review by at least two attorneys. 

 I understand those opinions have since been questioned. I am not an attorney and 

can’t pass judgment on that issue. I do believe as a former law enforcement officer that it 

is important that the law be clear so that everyone knows its limits. If the problem that 

brought us here today starts the process of clarifying the law, some good will have 

occurred. HP and its exceptional employees will get past this difficult period, it is a 

strong company with loyal customers and clients. In the meantime, I am pleased to assist 

the Committee by answering questions and providing information, particularly if it helps 

in passing legislation which will clarify the law. 

MR. WHITFIELD. Thank you, Mr. Adler, and we appreciate all the 

testimony of all the witnesses. Ms. Dunn, I think all the evidence and 

documents and even your testimony show that as Chairman of the Board 

of Hewlett-Packard, that you were certainly involved in this investigative 

process. 

And you had mentioned in your opening statement that you thought 

these phone records were publicly available, that they were just available 

to the public. 

I was just curious, I know you have had a broad range of experiences 

and have been quite successful in your corporate life and--but, what, 

where did you feel like, that people could obtain phone records and 

private information like that publicly? 

MS. DUNN. Mr. Chairman, I did not know where this information 

could be found publicly. But, I was aware that the kinds of 

investigations done by Mr. DeLia had previously been based on solely 

publicly available information. 

In the context of my understandings from all of those whose 

representations I trusted, I took the understanding without any question, 

and I understand why that might seem strange today, knowing what I 

know now, but that was my state of mind at the time. 
82

MR. WHITFIELD. Now, Mr. DeLia, in some of his documents, which 

I won’t ask you to turn to right now, but he stated that back in 2005, in 

discussions with you and others, that he discussed the methodology of 

pretexting and what that was all about. Do you recall a discussion with 

him back in 2005 about the subject of pretexting? 

MS. DUNN. I have no recollection of a conversation with Mr. DeLia 

that included the word “pretexting” or anything about the 

misrepresentation of identity to obtain phone records. In fact, the first 

time the word “pretexting” entered my consciousness was at the time 

when Mr. Sonsini began responding to Mr. Perkins’ concerns in late June 

of 2006. The word, as some members of this committee have already 

said in their statements, is not one that was commonly understood as to 

its meaning, or certainly its potential illegality. 

MR. WHITFIELD. Now, when Mrs. Baskins was on the panel, I asked 

her about some notes that she made on June the 15th of 2005. And in her 

notes--and this is in Exhibit 124 of the exhibit book--these are notes of 

Mrs. Baskins, and the very first note says, “Obtaining phone numbers is 

a time-consuming process. Call carriers, Nextel, Sprint, and use 

pretexting to extract the information.” And then they have your initials 

down here of questions that you asked. 

Do you recall being at the meeting reflected in the notes of Ms. 

Baskins back in June of 2005 about pretexting? 

MS. DUNN. I do not recall being in that meeting. I assume it was a 

telephone meeting, but I do not know. She may have been passing along 

questions from me, but I don’t have a recollection to report to you. 

MR. WHITFIELD. So your comment to this committee, then, is that 

the first time you really heard the word “pretexting” or understood what 

it meant was in Mr. Larry Sonsini’s e-mail in June of 2006? 

MS. DUNN. That was the first time that the word jumped out at me. 

And it was within days or certainly weeks that I began to understand that 

pretexting could involve the fraudulent misrepresentation of identity. 

That was not something that I had understood until that point. 

MR. WHITFIELD. Because as I mentioned to you earlier in Exhibit 

115, Mr. DeLia, in an interview conducted by the law firm of Wilson 

Sonsini on August 21, 2006, he said himself that he had no doubt that he 

had discussed the methodology of pretexting, including impersonation, 

with you; but your testimony is you simply don’t recall that or are not 

familiar with it; is that correct? 

MS. DUNN. Well, at minimum I don’t recall it. I don’t agree with 

Mr. DeLia’s testimony. 

MR. WHITFIELD. Okay. Now, Mr. Sonsini, I know that you’re one 

of the most respected attorneys in the Silicon Valley. And I know that 

your expertise is not criminal law, and I know that some of these 
83

documents, as we went through this process of Kona 1 and Kona 2 and 

why your firm was not really involved in it, here say you had sent some 

e-mails or made some comments that it appeared to be proper what was 

going on, is that correct? 

MR. SONSINI. Yes, it is, Mr. Chairman. I believe you’re referring to 

an e-mail exchange with Mr. Perkins, and you--if you would like, I’d like 

to elaborate on that. 

MR. WHITFIELD. Go ahead. 

MR. SONSINI. Well, at the time Mr. Perkins inquired of me through 

the e-mail what was going on. I think it’s important to note that I, too, at 

that particular point in time did not understand pretexting, it’s not an area 

of my expertise. I immediately turned to Ms. Baskins and Mr. Hunsaker. 

I said, we should tell Mr. Perkins what was going on; he was the director 

at the time of the investigation. And I said, what can you tell me to 

respond to him? 

I got a detailed written response from Mr. Hunsaker telling me what 

was done and what was lawful. I got a confirming response from Ms. 

Baskins. And as my e-mail indicated, I then took that information and 

immediately went to Mr. Perkins and I said to him, here is what I’ve 

been told. And I said: it appears based upon the repeated assurances that 

I was given, that what was done was within legal limits. And that was 

the extent of my communication with him. 

MR. WHITFIELD. Now, did either one of you--are you aware of any 

document prepared by legal counsel within Hewlett-Packard about the 

legality or illegality of pretexting? And, Ms. Dunn, did you receive a 

legal document explaining that pretexting was legal? 

MS. DUNN. I never received a formal legal opinion, but in Mr. 

Hunsaker’s final draft report of March 14th on the investigation, as was 

also contained in the final report in May, he made it very clear, after 

laying out all of the investigative methods, that each of them were legal 

and proper and in conformance with the standard investigative 

techniques that the company had been using for years. 

MR. WHITFIELD. Because I tell you, from our review of the 

documents--and there have been a lot of documents--we’ve determined 

that the only legal opinion ever given was by the attorney for the private 

investigator in Boston, what was his name? Ron DeLia. He--John 

Kiernan was the attorney’s name, and that he wrote an opinion saying 

that pretexting was legal. And in further analysis, we’ve determined that 

actually a law clerk wrote that opinion. So it would appear that 

Hewlett-Packard, at the very highest levels, relied upon a document 

prepared by a law clerk hired by the private investigator saying that 

pretexting was legal; that’s what it looks like. 
84

MS. DUNN. I think you’ll also find in the documentary evidence that 

there was a memo to the effect that pretexting, indeed, all the 

investigative techniques used in this matter, were legal. I was not 

familiar with the second opinion, if they may be termed-- 

MR. WHITFIELD. Which e-mail is that that said it was legal? 

MS. DUNN. It has not been produced by the company. 

MR. WHITFIELD. Oh, it has not been produced by the company? Oh, 

okay. Well, did you have it at the time; or when did you receive that? 

MS. DUNN. I need to refresh my memory on the date of that, and I 

would be happy to come back to you with that answer. 

MR. WHITFIELD. If you would turn to document 83. And if you 

would look at that and tell me, is that the document that you’re referring 

to? 

MS. DUNN. In which section, sir? 

MR. WHITFIELD. The large book, document 83. 

MS. DUNN. May I have a moment to review this? 

MR. WHITFIELD. Sure. You don’t recognize it right off? 

MS. DUNN. This was a memorandum from Mr. Hunsaker to Mr. 

Gentilucci and Mr. DeLia. It says it’s prepared at the direction of 

counsel-- 

MR. WHITFIELD. The only question I was asking is, is this the 

document that you relied upon that showed that pretexting was legal? 

That’s all I want to know. 

MS. DUNN. I do not recall seeing this e-mail before this moment. 

MR. WHITFIELD. Okay. Just one other brief question, and then we’ll 

move on. 

Mr. Sonsini, I want to ask you this: California Penal Code 538.5 

reads as follows, that it prohibits fraudulently obtaining information from 

a public utility--and as I understand it, that in California a public utility is 

considered a phone company, among other things--that this statute makes 

it unlawful for any person to transmit or cause to be transmitted by 

means of wire, radio, or telephone communication any words, sounds, 

writings, signs, signals or pictures for the purpose of furthering or 

executing a scheme or artifice to obtain from a public utility confidential, 

privileged or proprietary information, customer records, billing records, 

customer credit data or accounting data by means of false or fraudulent 

pretenses, representations, impersonations or promises. That almost 

seems like it definitely is right on line with what we’re talking about. 

MR. SONSINI. No doubt, Mr. Chairman. Although I’m not an expert 

or familiar with that statute, we did do, when we investigated the legality 

of the investigation, conclude that methods may very well have been 

used which implicated that statute. 

MR. WHITFIELD. Okay. My time is expired. 
85

I recognize the gentlelady from Colorado for 10 minutes. 

MS. DEGETTE. Thank you, Mr. Chairman. 

Ms. Dunn, you have been involved in the corporate world for over 

30 years, as near as I can see, is that correct? 

MS. DUNN. That is correct. 

MS. DEGETTE. Have you ever had occasion to request or direct this 

type of investigation into corporate officers or employees before? 

MS. DUNN. Nothing of this kind. And if I may, I would like to 

correct the record, as is contained in my written testimony, that I was not 

the person who hired Mr. DeLia-- 

MS. DEGETTE. Okay, I understand that. But you were the one who 

requested the investigation, correct? 

MS. DUNN. At the--I was operating as a Nonexecutive Chairman-- 

MS. DEGETTE. Yes, I know that. 

Now, I want to ask you, Mr. Sonsini--and I apologize, I don’t mean 

to be short, but I only have 10 minutes. 

Mr. Sonsini, I want to ask you because you are one of the most 

prominent Silicon Valley lawyers. We’ve even heard of you in 

Colorado. My question to you is as outside counsel for many of these 

corporations, is this standard business practice in the industry where 

leaks or other kinds of breaches are suspected to have investigations of 

this type? Is this something you have dealt with? 

MR. SONSINI. I have never dealt with an investigation of this kind of 

a board of directors with respect to a leak of confidential information. 

MS. DEGETTE. Have you ever seen any kind of investigation of 

confidentiality leaks, whether board of directors or other types of 

employees of a corporation, where you have pretexting, have you ever 

seen that? 

MR. SONSINI. I have not, to my knowledge. 

MS. DEGETTE. Have you ever seen investigations that involved 

going through trash of corporate officers, directors or employees? 

MR. SONSINI. Not to my knowledge. 

MS. DEGETTE. Have you ever seen investigations come up with 

fake employees in order to get information from reporters? 

MR. SONSINI. Not that I have knowledge of. 

MS. DEGETTE. So this is news to you as well. 

MR. SONSINI. Yes, ma’am. 

MS. DEGETTE. Now, Mr. Sonsini, as outside counsel to HP, were 

you briefed or were you consulted about the scope of this investigation 

and the methods used? 

MR. SONSINI. No. 
86

MS. DEGETTE. Were you provided with the draft of the 

investigation report, which is dated on March 10, 2006? It’s in Tab 72 of 

our notebook. 

MR. SONSINI. I think you’re referring to a report I’m familiar with; 

yes, it was provided to me on or about April 6 of 2006. 

MS. DEGETTE. Okay. On page 3 of that report it says, they’re 

talking about the procedures that they used, and they talk about 

obtaining--obtained, reviewed and analyzed HP and third-party phone 

records to identify calls made to or from reporters or other individuals of 

interest. And then there is a footnote that says the investigation team 

utilized a lawful investigative methodology commonly utilized by 

entities such as law firms. 

Did that raise any red flags to you? 

MR. SONSINI. Well, I remember it, and I certainly did focus on that 

footnote. 

At the time I had the report, of course, I was asked to deal with the 

issue in the Boardroom, what do we do with Mr. Keyworth? I wasn’t 

asked at that time to investigate the investigation, and I’m certainly not 

an expert in such matters, so it wouldn’t have been sent to me. 

MS. DEGETTE. But you said you focused on the footnote. Were you 

concerned about what those techniques were to obtain the phone records? 

MR. SONSINI. I was concerned by the scope of the investigation as 

evidenced by the report, and I did focus on that footnote. 

MS. DEGETTE. And what did you do about your concern? 

MR. SONSINI. At that point in time I did nothing further. I had 

discussions with Ms. Baskins. I asked her about the performance of the 

investigation and its legality. I asked her, did you rely upon experts, did 

you get legal advice, did you research it, and I was assured that they did. 

MS. DEGETTE. It sort of seems to us up here like it was kind of 

circular reasoning, because Ms. Dunn says, look, I was just asked to stop 

the leak, but I wasn’t in charge of the actual conduct of the investigation, 

right, Ms. Dunn? Is that correct? 

MS. DUNN. I did not supervise this investigation. I initiated it at the 

request of the Board. 

MS. DEGETTE. So then General Counsel Ms. Baskins, who 

unfortunately is not testifying, she talks to her experts, and they say, 

well, this is all okay. Then she asks you, and then you’re relying back on 

Ms. Baskins; is that right, Mr. Sonsini? 

MR. SONSINI. No, she never asked me. At the time I got the report, I 

was not asked about it whatsoever. 

The fact is this investigation was conducted by the Hewlett-Packard 

legal department. They took the responsibility on. I learned of it after 

the fact, after it occurred. And it wasn’t until the Board of Directors 
87

asked me to investigate it that I was able to get into the legality of the 

conduct. 

MS. DEGETTE. Okay. Let me move on a little bit. 

And I want to ask you, Ms. Dunn, about something else that 

happened which I think is just almost as bad as the pretexting, and that’s 

the creation of this fictitious character named Jacob. Jacob was a 

fictitious employee of HP who was designed principally to find out about 

the potential sources of an outside reporter named Dawn Kawamoto. 

Now, you’re familiar at least now with this operation, correct? 

MS. DUNN. Yes, I am. 

MS. DEGETTE. Do you know, is it common practice for HP to create 

fake disgruntled employees to sting outside reporters? 

MS. DUNN. I do not know what normally goes on except what I have 

been told. 

MS. DEGETTE. Did you ever hear about that type of operation? 

MS. DUNN. It would not come to my attention if it were the case. As 

a nonemployee, nonmanager, outside director, I really can’t answer your 

question in the way I think you need it to be answered. 

MS. DEGETTE. Well, except for you’re the one that ordered the 

investigation, right? 

MS. DUNN. I initiated it at the request of the Board as Nonexecutive 

Chairman. And I would like to just add, this is an unusual position in 

corporate America. Less than 9 percent of companies have a position 

like this. I had no staff, no office, and I reported only to the Board. The 

CEO doesn’t report to me, nor do any other people at HP. 

MS. DEGETTE. I understand that. But if you take a look at Tab 60 in 

your notebook--actually, take a look first at Tab 21 in your notebook, 

where Mr. Hunsaker says to Mr. Gentilucci, “We DEFINITELY need to 

get the approval of Ann, Mark, and Pattie before doing it”--and this 

would be the Jacob operation. You have seen that e-mail, right? 

MS. DUNN. I have. 

MS. DEGETTE. And then you--if you will take a look at Tab 60, on 

February 22, 2006, Mr. Hunsaker sent you and Ms. Baskins an e-mail 

that says, “Hi, Ann and Pattie, below please find the e-mail we propose 

sending Dawn Kawamoto with the hope she would forward it to George 

Keyworth.... I made up everything in the side, trying to make it at least 

somewhat feasible...,” and it goes on, correct? 

MS. DUNN. I recall the e-mail. 

MS. DEGETTE. And you saw that at the time, too. So you knew this 

operation was going on at the time. 

MS. DUNN. I knew what--yes, I did. And-- 

MS. DEGETTE. And did you think there was any problem with that, 

someone pretending to be someone named Jacob sending e-mails to a 
88

reporter to try to get information from a reporter as to a leak within the 

Board? 

MS. DUNN. At no time in any part of this investigation was I 

responsible for designing its methods. 

MS. DEGETTE. Right. But you knew about-- 

MS. DUNN. I asked for this to be done in the HP standard way. This 

did raise a concern to me. I did not want to be at any point the person to 

whom the team turned for approval of specifics. The way I responded 

was to say this is a management thing. 

MS. DEGETTE. Okay. I understand that. But you ordered the 

investigation, you knew these techniques were being used, you 

developed a concern. What did you do about it? 

MS. DUNN. I sent the team to management to get approval for their 

techniques. 

MS. DEGETTE. Who was that in management? 

MS. DUNN. Mr. Hurd. 

MS. DEGETTE. So do we have an e-mail or-- 

MS. DUNN. I think there is some evidence that he was aware of this 

and-- 

MS. DEGETTE. Okay. What did you say to Mr. Hurd about this 

Jacob situation? 

MS. DUNN. I don’t remember a conversation. I remember telling the 

team that basically they had come to the wrong person for approval, that 

was not my role in this matter. 

MS. DEGETTE. So you knew this was going on, you’re the one that 

ordered the investigation, you had concerns, so your response was to 

send them over to talk to Mr. Hurd, but you yourself didn’t mention it to 

anyone? 

MS. DUNN. If I were going to have concern, it would have been 

expressed to Mr. Hurd. 

MS. DEGETTE. So did you express it to Mr. Hurd? 

MS. DUNN. I asked him to look into it and to give his opinion. 

MS. DEGETTE. And did you ever get an opinion from him? 

MS. DUNN. I understand that he did give a--I don’t know whether it 

was verbal, an e-mail or by an in-person meeting, but that they gained 

the approval they were seeking. 

MS. DEGETTE. Okay. Mr. Sonsini, in this draft investigation report, 

which you had said that you saw, Tab 72, a minute ago, they talk about 

this Jacob situation on page 4 of that report, which you saw. They said 

they engineered and executed a covert intelligence-gathering operation. 

Were you familiar with that? 

MR. SONSINI. No, ma’am. 

MS. DEGETTE. So you didn’t read that part-- 
89

MR. SONSINI. I read it, but I wasn’t familiar with it. Other than what 

was-- 

MS. DEGETTE. Did you have any concerns that HP might be using a 

fake person to get information from a reporter? 

MR. SONSINI. Congresswoman, at that time that was not my focus 

that I was retained to do. 

MS. DEGETTE. Thank you. 

MR. WHITFIELD. The gentlelady’s time is expired. 

At this time I recognize Chairman Barton. 

CHAIRMAN BARTON. Thank you, Mr. Chairman. 

I’m going to take my full 10 minutes, and I assume we will go to 

recess to go have the votes on the floor? 

MR. WHITFIELD. That’s correct. 

CHAIRMAN BARTON. As soon as the bells stop, I’ll start. 

Well, first of all, I want to thank you three for not taking the Fifth 

Amendment; it’s good to have some people willing to answer questions. 

I want to start with you, Mrs. Dunn--or Ms. Dunn. You claim that 

your position is one that is somewhat unique and that you don’t have 

direct staff. Who does report to you? 

MS. DUNN. No one. 

CHAIRMAN BARTON. No one? 

MS. DUNN. No one. 

CHAIRMAN BARTON. So you’re purely an administrative adjunct of 

the Board. 

MS. DUNN. As part of my written testimony, I submitted the job 

description for the Nonexecutive Chairman that was approved by our 

Board. And it is very clear it’s a coordinator role, it’s a facilitator role, 

it’s a conduit-- 

CHAIRMAN BARTON. You had no direct management-- 

MS. DUNN. No. 

CHAIRMAN BARTON. --responsibility? You are purely a functionary 

of the Board? 

MS. DUNN. I served at the pleasure of the Board. 

CHAIRMAN BARTON. Did you sit in on the Board meetings? 

MS. DUNN. I chair the Board meetings--I did chair the Board 

meetings until my resignation last week. 

CHAIRMAN BARTON. All right. Now, this whole investigation got 

started because there were leaks from materials presented in Board 

meetings, and perhaps leaks of discussions at Board meetings; is that 

correct? 

MS. DUNN. That is correct, sir. And in the submission, there is a 

detailed chart of some of the leaks that were the most serious and 

undermining to our company. 
90

CHAIRMAN BARTON. I appreciate that, but I don’t have too much 

time. 

The Board was divided, or was the Board unified? Was the 

Hewlett-Packard Board that you chaired a team that worked together, or 

were there schisms on the Board and quite a bit of controversy? 

MS. DUNN. After I became Chairman, I became highly cognizant of 

deep schisms between various individuals on the Board. 

CHAIRMAN BARTON. So some of the Board members, or member or 

members apparently took materials that were requested to be confidential 

and disseminated without permission. What steps did the Board take 

before you resorted to all of this sordid detail to try to get the Board 

members to ‘fess up’? Did you all discuss it in the Board, and if so, did 

everybody put their hand on a Bible and swear they weren’t the leaks 

and-- 

MS. DUNN. Yes. The first inquiry into leaks actually began under 

the administration of Carly Fiorina, who was Chairman and CEO until 

February of 2005. She asked Mr. Sonsini to talk with every director oneon-one about the functioning of the Board, and to seek the confession of 

whoever the person or persons were that were leaking this confidential 

information, as well as to reassert their commitment to confidentiality 

going forward. 

The reason why the Board, by the time I got involved, was so deeply 

concerned was because they knew that no one had come forward to 

admit their culpability. 

CHAIRMAN BARTON. How many Board members were there? 

MS. DUNN. I believe there were nine independent directors at that 

time, including myself, and two members of management--one member 

until Mark Hurd arrived in April. 

CHAIRMAN BARTON. And did the Board take a vote to initiate the 

investigation? How were you directed to start this investigation? 

MS. DUNN. I was directed in one-on-one conversations, about which 

I have submitted my notes to this committee, by seven of the nine 

directors that next to hiring or helping the Board to identify its next CEO, 

my top priority was to help the Board come to grips with these leaks. 

And I reported to the Board in my first meeting as Chairman in March 

that I took that responsibility seriously. 

CHAIRMAN BARTON. So 7 of the 11 Board members told you-- 

MS. DUNN. Seven of nine. 

CHAIRMAN BARTON. Told you individually, but there was never a 

vote collectively to start this investigation. 

MS. DUNN. There was never a vote collectively. 

CHAIRMAN BARTON. Was Mr. Keyworth one of the ones who told 

you to start the investigation? 
91

MS. DUNN. He was not. 

CHAIRMAN BARTON. He was not. So the first investigation was 

Kona 1, was inconclusive; is that correct? 

MS. DUNN. It was. 

CHAIRMAN BARTON. And Kona 1 did not use pretexting. 

MS. DUNN. I believe it did use pretexting. 

CHAIRMAN BARTON. Did it use pretexting? Okay. 

MS. DUNN. I’m sorry, I’ve just been corrected. I don’t know. 

CHAIRMAN BARTON. All right. Well, that’s a fair answer. I don’t 

know a lot of stuff either, and that’s okay every now and then to not 

know. 

But when did it arise to your attention that pretexting was being 

used? At what point, in which investigation? 

MS. DUNN. Mr. Chairman, in the sense of the word that we’re all 

using pretexting today, which is the fraudulent misrepresentation of 

identity, a form of identity theft, this was not something I understood 

until early July of 2006 as a possible component of either investigation. 

CHAIRMAN BARTON. Okay. Now, I just want to make sure that we 

understand. We have a divided Board. Somebody on the Board is 

leaking information that the people that are not leaking it think is 

inflammatory. So there is kind of a general investigation to get people to 

confess and stop their bad behavior. That doesn’t work, so a majority of 

the Board individually says: I want this stopped, I want to find out who is 

doing this, and by golly you’re the Chairman of the Board, you start this 

investigation. 

MS. DUNN. You work for us, we need this work done. 

CHAIRMAN BARTON. You go, apparently--do you clear this with 

Mr. Hurd, the Chief Executive Officer, who is going to testify next? 

MS. DUNN. He was not with Hewlett-Packard in the period when I 

was first named Chairman. 

CHAIRMAN BARTON. All right. Do you go to Mr. Adler down there 

and say, I want you to do it? I mean, did you go to Mr. Sonsini and say, 

I want you to do it-- 

MS. DUNN. No. 

CHAIRMAN BARTON. Who did you call to do it? 

MS. DUNN. I went to Mr. Bob Wayman, who is the long-serving 

CFO of Hewlett-Packard, arguably the CFOs’ CFO. 

CHAIRMAN BARTON. Even though you had no direct management 

responsibility, you went to the Chief Financial Officer of the company. 

MS. DUNN. He was a fellow director of the company, who, in his 

role as a director and a fiduciary, was as concerned about these leaks as 

any other director. 

CHAIRMAN BARTON. Is the director the same as a Board member? 
92

MS. DUNN. Yes, it is, sir. 

CHAIRMAN BARTON. So he was one of the Board members who 

wanted to do the investigation. 

MS. DUNN. He was one of the seven, yes, sir. 

CHAIRMAN BARTON. Okay. And is he the one responsible who 

hired these outside investigators to do the investigation? 

MS. DUNN. Not directly, but as noted in the reporting relationships 

chart, he had control over all of the functions that are involved in security 

investigations. He directed me to someone in his organization who 

directed me to someone that does this work. 

CHAIRMAN BARTON. When these Board members asked you to do 

this or told you to do the investigation, and when you went to 

Mr. Wayman, who is also a member of the Board, was there any 

discussion about--I mean, was this personal? Was this, we want to get 

him whatever it takes, do what it takes? Or was it, we’d like to know, 

but we don’t really want to cross any boundaries? 

MS. DUNN. There was never any question in my mind that the Board 

expected this investigation to be done not only legally, but ethically. 

CHAIRMAN BARTON. Well, if seven of the nine members wanted the 

investigation, I would start with the premise that the two that didn’t were 

the primary suspects. Was any extra consideration given to the two 

Board members who didn’t want the--I mean, it would seem to be they 

were the ones most likely to be leaking information. 

MS. DUNN. I did provide background to the investigators, as I was 

told was the normal process in these matters, about who wished and who 

did not wish to have an investigation. I, as I mentioned before, was one 

of those six or so directors whom the investigators decided was among 

the Board of Directors’ likely suspect. I saw myself as needing to be as 

independent of the investigation as possible so that they could do their 

work without the implication that I would not be considered. 

CHAIRMAN BARTON. Mr. Adler, what is your role in this? What is 

IT Security Investigations? Is it a direct arm of Hewlett-Packard, or is it 

on retainer by Hewlett-Packard? 

MR. ALDER. Mr. Congressman, I am under a completely separate 

entity within the Hewlett-Packard organization, and with no common 

point of management until Mr. Hurd. My role was to participate with 

regard to obtaining internal HP records, and to participate in the 

investigation as required or as directed by HP counsel, specifically Mr. 

Hunsaker. That may have included interviews or any other technical 

assistance, computer forensics, things of that nature. 

CHAIRMAN BARTON. So you’re an internal investigatory arm of 

Hewlett-Packard? 
93

MR. ALDER. Yes, sir. In this particular time I was; sometimes I 

functioned as the sole investigator, depending on the circumstances and 

where jurisdiction of the investigation falls under. 

CHAIRMAN BARTON. Mr. Chairman, my time is expired, and we 

have to go vote. I just have one final question. 

If I called you up, Ms. Dunn, and said, I’d like your phone records 

for the last 6 months, I’m Chairman Barton of the Energy and Commerce 

Committee, but I’d like to look at your phone log, would you give me 

that? 

MS. DUNN. If I understood why you wanted it-- 

CHAIRMAN BARTON. No. I call you up; would you give me it, your 

phone records? 

MS. DUNN. In your position? I would give you my phone records. 

CHAIRMAN BARTON. Praise the Lord. I wouldn’t give you mine. 

MS. DUNN. I hope that doesn’t mean you have something to hide. 

CHAIRMAN BARTON. I wouldn’t give them. 

Now, if I get with former Chairman Dingell, and he and I say we 

have reason to believe that we have an official right for the public to 

know your records, I can sign a subpoena as Chairman of this committee, 

with Mr. Dingell’s acquiescence, and I can get your phone records, but I 

have to sign an official document. And I’m doing that in an official 

capacity. And I don’t do that very often, I take that very seriously. I 

don’t issue many subpoenas. But if I just want to peruse your 

background, I can’t do that as an individual citizen, and I shouldn’t be 

allowed to without your permission. And in this investigation, at some 

point in time people very high up in your company either didn’t ask the 

right question or ignored it, because there was such a motivation to find 

out who was leaking. 

Nobody condones the leaks. We have leaks in this committee, but 

the-- 

MS. DUNN. Mr. Chairman, may I make a comment on Mr. Barton’s-

- 

CHAIRMAN BARTON. And I’m going to have to go. But this whole 

issue of pretexting is--we understand the right of confidentiality in a 

boardroom and the right to conduct a private investigation. This 

committee is concerned because the use of the pretexting ignores what 

most people think is right and wrong-- 

MS. DUNN. I understand that, sir. 

CHAIRMAN BARTON. That’s our problem. 

MR. WHITFIELD. Ms. Dunn, if you would hold your remarks. The 

reason I say that is we have 1 minute and 20 seconds to go vote on the 

House floor, and then we’re going to have this floor, and then three more 

votes at a maximum of about 5 minutes each. So we’re going to recess 
94

this hearing until about 1 o’clock, and then we will all come back, and 

then you can make whatever comment you would like to make at that 

time in response to Chairman Barton. So we will recess until 1 o’clock. 

[Recess.] 

MR. WHITFIELD. The hearing will come to order. 

I said we would be back at 1:00; it’s 5 after, so we were 5 minutes 

late. 

At this time, I recognize Ms. Schakowsky for 10 minutes. 

MS. SCHAKOWSKY. I want to also thank the witnesses for coming 

here today and being willing to testify; it really means a lot to us. 

And one other preliminary remark. I want to associate myself with 

what Mr. Otter and Ms. Eshoo both referred to, because I want to get at 

the culture that is taking place in boardrooms. But I think that we as 

Members of Congress have to look at our own culture here, too, and the 

issue of the processes that we have worked in terms of NSA 

eavesdropping and getting phone records, and the assertion of this 

administration that the ends in a sense do justify the means, in this case 

terrorism, in your case a leak within the Board of Directors. And I am 

concerned about both, that we have ethical and legal processes that allow 

us to achieve very laudable--or sensibly laudable goals anyway. 

But I think it is significant for us to talk about this issue of corporate 

culture. And I wanted to--Ms. DeGette was talking about the e-mails on 

February 22, 2006, from Mr.--is it Mr. Hunsaker--sent to you, Ms. Dunn, 

and Ms. Baskins about Jacob and about Dawn Kawamoto, the reporter, et 

cetera. And when he says, I made up everything on the sly, trying to 

make it at least somewhat feasible, I won’t quit my day job--he is being 

light-hearted. While your response did say that you said as a matter of 

course anything that is going to be potentially outside of HP should have 

Mark’s approval as well, et cetera. But you also said, “Kevin, I think this 

is very clever.” And I just wondered if you would comment on that. 

MS. DUNN. I will comment on that. I regret that comment; it doesn’t 

characterize my state of mind. I may have been trying in some kind of, 

in retrospect, inappropriate way to tell the team that I thought they were 

doing a good job. In reading that comment today, it embarrasses me. 

MS. SCHAKOWSKY. Thank you. 

I also wanted to know--and it is Tab 29 in the book, a PowerPoint 

that says that it was an initial briefing-- 

MR. WHITFIELD. Excuse me, Ms. Schakowsky. Do you have the 

document book on the table? 

MS. DUNN. It seems to not be here any longer. 

MR. WHITFIELD. Could you bring the document book over, please? 

Did you say document 29? 
95

MS. SCHAKOWSKY. Tab 29, correct. And on page 10 of that report, 

there are lists of either potential or ongoing investigative methods that 

are being proposed in this investigation. And I just wanted to walk 

through those a little bit and ask you if you had approved them or heard 

about them, or if they went forward. 

Under the title “Surveillance Intelligence Operations” it reads, 

“Pre-trash inspection survey is in process for key subjects for the 

investigation.” And I wondered if you knew that HP investigators were 

about to or were actually rummaging through the trash of certain 

individuals? 

MS. DUNN. The direct answer is no. The context is this was a 

PowerPoint presentation that was given in a meeting room-- 

MS. SCHAKOWSKY. You did see that presentation? 

MS. DUNN. I don’t know that every page was actually shown. I was 

interested in pages 12 and 13, which focused on the work that had been 

done to try and legitimately hypothesize who within our Board could be 

responsible for these confidentiality breeches. 

So to answer the question, did I focus on, did I know? It’s not even 

clear to me that this was put up on the screen, and I do not recall getting 

a hard copy of it. 

MS. SCHAKOWSKY. And did you know if Mr. Hurd--do you have 

any knowledge that Mr. Hurd knew about these activities? 

MS. DUNN. I have no knowledge--I have no direct knowledge. 

MS. SCHAKOWSKY. Okay. In this same document, and that is Tab--I 

guess in this one, it says, “Surveillance activity was conducted for G.K.”-

-I guess that’s George Keyworth--”speech in Colorado on January 31, 

2006.” 

Did you know that HP investigators were using HP money to 

assemble surveillance teams for this Board member and possibly press 

reporters at this point? And when did you know this, and who approved 

of this expenditure? 

MS. DUNN. I learned after this document, and I can’t pinpoint the 

date, but probably sometime after the release of Mr. Hunsaker’s report, 

that a security detail from Hewlett-Packard--which normally attended 

company events, so not specifically for the purpose of surveilling 

Dr. Keyworth--had reported nonetheless back to their chain that he had, 

on a number of occasions, disclosed confidential information orally to 

groups of employees who did not have authority to hear that information. 

So it’s not clear to me now that there were, for example, details of 

surveyors, surveillers to cover him specifically, but I am aware now--

have come to be aware that actually for several years there were concerns 

among the security staff about his public comments, and that they had 

reported some of them through the security chain. 
96

In terms of who approved the--if you would still like me to answer 

that. 

MS. SCHAKOWSKY. Well, I just wanted--it included photographs of 

his home in Italy. Obviously trips were taken. We know that 

Mrs. Keyworth was observed in Breeze Restaurant. The family was also 

followed. 

MS. DUNN. I was unaware of all of those activities until I read about 

them in the press within the last week or two as these documents started 

to find their way into the media. 

MS. SCHAKOWSKY. And for reporters as well, you weren’t aware? 

Did you see the photograph of the reporter, Ms. Dawn Kawamoto? 

MS. DUNN. No. I would like to specify that I became aware that 

reporters had been pretexted by Ms. Baskins on--I believe it was 

September 6, it was a Wednesday evening of this year. That was the first 

awareness that I had that reporters had been pretexted as a part of this 

investigation. 

MS. SCHAKOWSKY. Now, this PowerPoint--and I understand that 

you’re saying that you’re not sure that all the pages were being shown, 

but there is--on page 15 it talks about other investigative options under 

review. We’ve got misinformation/sting scenario, covert undercover 

operations, placement of agent in close proximity of persons of interest, 

most likely location news agencies. 

And I guess what I’m trying to get at in this line of questioning, is all 

of this really the HP way? I mean, it’s pretty well detailed out that 

whether or not--I’m not even talking about the legality issues so much as 

kind of the sleaze factor here, and I’m just wondering if none of this 

really came through to you over the period. 

MS. DUNN. Well, first I have to say that I never remember seeing 

this piece of paper; it may or may not have been presented. My view is 

that it wasn’t-- 

MS. SCHAKOWSKY. Who failed you? 

MS. DUNN. May I finish answering your first question? 

MS. SCHAKOWSKY. Sure. 

MS. DUNN. Thank you, Madam Congresswoman--I never knew if I 

was Chairman or Chairwoman. 

The fact is that I believe that these methods may, in fact, be quite 

common not just at Hewlett-Packard, but at companies around the 

country. Every company has a security department. Every company of 

consequence has people who do detective-type work in order to ferret out 

the sources of nefarious activities. 

An example might be that at Hewlett-Packard one of the great 

problems that it faces worldwide is called gray marketing, where 

unauthorized agents for the company’s products basically serve as a 
97

conduit between the company and channels of distribution. It’s a huge 

problem. And I’ve heard about, in the Audit Committee of 

Hewlett-Packard, how there are people in the investigations team who 

actually pose as customers or pose as suppliers or pose-- 

MS. SCHAKOWSKY. As clerical workers in newsrooms, too? 

MS. DUNN. That I never heard, but my point is--and I’ll wind up. 

But companies do a lot of this type of work to protect the interests of our 

shareholders, and maybe we’re all just coming to be aware of how 

common it is. 

MR. WHITFIELD. The gentlelady’s time is expired. 

At this time I recognize Mr. Walden for 10 minutes. 

MR. WALDEN. Thank you very much, Mr. Chairman. 

Ms. Dunn, I’m just having some trouble here tracking all this based 

on what I’m reading in your document binders and what I’m hearing 

today, and I want to go back to make sure I understood. 

When we referenced the document that was in Tab number 24, the 

handwritten minutes or notes of Ann Baskins from a meeting of June 

15th, as I recall your testimony earlier today under oath, you said you 

didn’t recall being in that meeting. 

MS. DUNN. I have no recollection-- 

MR. WALDEN. No recollection. 

MS. DUNN. I’ve seen this for the first time now. 

MR. WALDEN. I’m not wondering whether you have seen this for 

the first time. Do you remember being part of this discussion? 

MS. DUNN. I do not. 

MR. WALDEN. Then I would direct your attention to Tab number 2. 

Tab number 2 is a copy of an e-mail message from you to Ron DeLia in 

which you reference Kona. It is dated June 14th of 2005, the day before 

this meeting. In that--I’ll read it. It says, “Ron I would like to 

reschedule our call to include Ms. Baskins, General Counsel at HP, in the 

next couple of days. Ann is now involved in the confidentiality review, 

and it would be timely to compare notes and discuss where to go from 

here. Can you do it at 2 p.m. Eastern Daylight Time tomorrow, 

Wednesday? And can we use your conference line? Regards, Pattie.” 

June 14th, do you remember that e-mail? 

MS. DUNN. I remember that e-mail, but without Ann’s June 15th

notes, which have just been put in front of me, my recollection was 

incomplete. I haven’t seen all the evidence here. 

MR. WALDEN. I understand you may not have seen her notes. My 

question was, do you have any recollection of having any discussion with 

any of these people that you set the meeting up for the next day? 

MS. DUNN. I will say one more time, I do not recall the June 15th

discussion. If I connect these dots, it took place, but as I-- 
98

MR. WALDEN. The importance of that is because there was a 

discussion about pretexting that obviously went on in the meeting, if Ann 

Baskins’ notes are to be believed, I think you understand the relevance of 

that to our discussion here. 

MS. DUNN. I do. 

MR. WALDEN. Let me move you to Tab 116, because this is a 

document that includes interviews with you from August 21st, interview 

with you conducted by Wilson Sonsini, who apparently you are not 

willing to contradict Mr. DeLia’s statement that he shared with you the 

concept of impersonation to get records. And I would note it says, and I 

quote, “Dunn thinks it was probable that she was told in some 

circumstances that they may need to use false pretenses, but that she was 

always assured that the methods used were lawful and consistent with 

HP’s practices.” And if you go to paragraph 26-- 

MS. DUNN. Could you point me to the number of the paragraph? 

MR. WALDEN. The top of the page is paragraph 25, but the first 

notation is paragraph 26. It says, Schatz explained that Mr. DeLia 

believed that he shared with Dunn the concept of impersonation to get 

records. Dunn said she is not willing to contradict Mr. DeLia on this. 

And then it goes on to say, “Dunn thinks it is probable that she was told 

that in some circumstances they may need to use false pretenses, but she 

was always assured the methods used were lawful and consistent with 

HP practices.” 

Do you disagree with those findings? 

MS. DUNN. I disagree with the transcription by Wilson Sonsini’s 

lawyer of our interview, and I was never given an opportunity to review 

their notes. 

MR. WALDEN. Do you disagree with the notion that you were not 

willing to contradict Mr. DeLia’s view of this? 

MS. DUNN. I remember what I said to Mr. Schatz was that I--if Mr. 

DeLia said this, I had no recollection of it. I don’t recall saying I am not 

willing to contradict him. That seems a paraphrase. 

MR. WALDEN. Mr. Sonsini, are you comfortable with what’s 

reported here? 

MR. SONSINI. Yes, I am, sir. 

MR. WALDEN. And do you believe that Ms. Dunn was made aware 

of pretexting as a part of the investigation? 

MR. SONSINI. I believe that the notes taken by Mr. Schatz, a senior 

partner in our firm, a former U.S. assistant attorney and Federal 

prosecutor, accurately reflects his recollection of that interview. 

MR. WALDEN. What does probable mean? Where he writes, Dunn 

thinks it’s probable that she was told that in some circumstances they 

may need to use false pretenses? 
99

MR. SONSINI. Well, I wasn’t in the interview, of course, 

Congressman, but I think--I shouldn’t speculate on what that exchange 

was. 

MS. DUNN. I would like to try and interpret, if I may. I believe I 

told Mr. Schatz that it was possible that I had seen the word “pretext,” 

not that there were false pretenses that I was aware of and the fraudulent 

misidentification of identity as part of this investigation. The word 

“pretext” does show up in documents that I have been shown that I saw-- 

MR. WALDEN. So sitting here today under oath, you’re going to tell 

us you never knew that they were going to use these techniques to spy on 

Board members and impersonation of others; you just never knew? 

MS. DUNN. It is my sworn testimony that until July of 2006, I was 

unaware that the fraudulent misrepresentation of identity was a part of 

the standard arsenal of HP tactics or used in this investigation. 

MR. WALDEN. In the document that we have here, the interview of 

Ron DeLia, draft from Wilson Sonsini Goodrich & Rosati--I believe it’s 

document number 115--talking about Kona 1, 2005 investigation, and in 

number 4 on page 1, it says, “DeLia has no doubt that he discussed 

methodology of pretexting, i.e., impersonation, with Dunn at some point 

during the 2005 investigation.” 

Mr. Sonsini, this is on your corporate--your law firm’s letterhead. 

Are you familiar with this document? 

MR. SONSINI. I am, sir. 

MR. WALDEN. And how should we understand that to be? 

MR. SONSINI. That document reflects, sir, the investigation we made 

and the information we received from the parties we interviewed. 

MR. WALDEN. Ms. Dunn, do you see why we’re troubled by this? 

MS. DUNN. I do. I think there are also references in this document 

to my request and ongoing, both seeking and receiving of assurances that 

everything being done in this investigation was legal and part of HP’s 

normal investigative process-- 

MR. WALDEN. So if they told you it was legal to impersonate 

someone to get documents, you didn’t see a problem with that? 

MS. DUNN. I never understood that to be the case, sir. 

MR. WALDEN. Well, Mr. DeLia said he had no doubt he discussed 

the methodology with you. And so what you’re saying is you don’t 

believe him. 

MS. DUNN. I wish he were here so we can talk about it. 

MR. WALDEN. Ann Baskins’ notes discuss that as well. Do you 

dispute those? 

MS. DUNN. I dispute having ever understood or being told that the 

fraudulent use of identity was a part of this investigation. And I would 
100

add that I had no reason to think that anything illegal was going on. 

There were batteries of experts telling me that that was not the case. 

MR. WALDEN. And I understand that you were advised that way, 

and some of those batteries of experts are now looking for work, and I 

understand that. I guess my question-- 

MS. DUNN. I’m one of them. 

MR. WALDEN. I understand that as well, and there may be more 

after you leave here today. 

My question is, you indicated earlier, and some of these e-mails 

would indicate, that you signed off at--somebody--I don’t know if I got 

that e-mail where it says you--”Pattie and Ann gave the thumbs up. Now 

we need to hear from Mark Hurd.” 

I guess my question is, you referenced earlier that you’re sort of 

there on the Board as an outside director. You’re the one that’s sort of 

been tasked by seven Board members, without a vote of the Board, to 

secretly put together Kona 1, Kona 2. There is a lot of e-mail traffic 

back and forth. 

You know, this April 19th memo to Ron DeLia from you says, “Ron, 

let’s call this Project Kona. Attached is the information we discussed, 

the phone numbers of all those present at the meeting referred to in the 

article.” I mean, these would lead me to believe that you were very 

involved in this. Even without a staff you were pretty active. And my 

question is that the e-mail from Mr. Hunsaker, which is under Tab 51, to 

team, from Kevin, Mr. Hunsaker says, “This is a tentative go. I’ve 

attached a document that purports to be an e-mail sent to Jacob about an 

announcement taking place next week. Let’s talk about the content on 

our call. After that, Fred, can you begin to prepare the document for 

Cindy? We cannot put this completely in motion until they clear it with 

Mark, but Ann and Pattie have both given the thumbs up, so we should 

be prepared to send it if Mark approves. Kevin.” 

Do you remember that e-mail? 

MS. DUNN. I have read that e-mail. I don’t agree with its 

characterization of my giving it the thumbs up. I said it needed to be 

approved by management. 

MR. WALDEN. In another part of this interview on August 25th, 

DeLia thought, page 3, “in all probability,” quote, unquote, that he used 

the word “pretexting” with Dunn and explained the term to her, but did 

not have a specific recollection of using the word. DeLia said he knows 

he would have described the processes with Dunn, but he did not tell 

Dunn that he was using a subcontractor. 

MS. DUNN. Sir, I am testifying here under oath; Mr. DeLia is not. I 

think I will leave it at that. 
101

MR. WALDEN. Well, I’m not sure we can leave it at that. Answer 

my question about Mark Hurd’s role about this. What was his role? You 

have indicated--you kind of deferred to him--can I at least finish asking 

the question, Mr. Chairman? 

MS. DUNN. May I answer, sir? 

MR. WALDEN. Yes. 

MS. DUNN. The question was, what was his role? 

MR. WALDEN. What was your understanding of his role in this 

process? 

MS. DUNN. That this particular element of the investigation could 

not go forward without his approval. 

MR. WHITFIELD. And I might add that more than likely we will have 

a second round as well, so--Mr. Inslee, you’re recognized for 10 minutes. 

MR. INSLEE. Thank you. 

I want to ask about Tab 29, Ms. Dunn, about this document. I think 

there has been some discussion about it already. It’s identified as Project 

Kona 2 HP. It says “Initial briefing, Pattie Dunn” on it, on the title page. 

It’s dated February 2, 2006. It’s a rather extensive document. 

It’s interesting in time. I introduced the first bill in Congress in this 

session to make it clear and to have tools against pretexting on January 

31st. Two days later HP’s involved in a very significant effort that I 

think as we go through this will show substantial willingness to defraud 

other people about the sources and how you were obtaining information. 

The timing is pretty amazing to me. 

But I want to ask you about this document. It has your name on it. It 

is entitled “Project Kona 2,” and on page 10, I believe--excuse me, page-

-page 10 of the document, I’ll give you just a moment to get to page 10 

there. 

MS. DUNN. I was just asked to look at this page, so I’m familiar with 

it right now. 

MR. INSLEE. Now, this document, as I understand, was something 

like a PowerPoint or a slide projection to use; is that correct? 

MS. DUNN. Yes, that’s how I believe it was used. It was projected 

during a meeting. 

MR. INSLEE. And on the title page it says it’s for you, you were the 

subject, you were the audience of this document, this presentation, I 

assume; is that correct? 

MS. DUNN. I remember that the meeting took place, and Ms. 

Baskins was with me. And, yes, I was the person who on behalf of the 

Board was tasked with this investigation. 

MR. INSLEE. So on page 10--are you with me there? Do you have 

that in front of you? 

MS. DUNN. I’m with you. 
102

MR. INSLEE. It’s entitled “Investigation Activity Update.” Now, I 

have to tell you, I was impressed with this document, with its extensive 

list of activities. Surveillance, intelligence operations, 

intelligence-gathering effort to document communications for all 

pertinent subjects. Pretrash inspection survey is in progress for key 

subjects. Presurveillance reconnaissance is in progress. Surveillance 

activity was conducted--and there is a list. 

Now, I want to ask you about this last one. It says, Feasibility 

studies are in progress for undercover operations, clerical, in CNET and 

WSJ offices in SF California. Now, I would understand that to say that 

you were considering--undercover to me is another way of saying that 

someone would be lying about their status, that HP was considering a 

method of having a person lie about their identity or their responsibility 

or their presence in some fashion, and in this case it was to CNET and to 

the Wall Street Journal. 

And so if my interpretation is correct, it appears to me that you had 

already stepped up over the line of being willing to falsify the identity or 

the role or the responsibility of a person in order to obtain this 

information; is that a fair statement? 

MS. DUNN. I don’t think that is a correct inference. I am not in the 

mind or was not in the minds of the investigation team. What they 

considered and what I saw are in many cases two different things. I 

think you can probably appreciate what happens when you go into a 

meeting and someone’s got a 30-page PowerPoint deck, and you’ve got 

limited time, and you say, let’s get to the meat of the matter here. I want 

to know who do you think did this. Let’s go to the analysis, what we 

know about who did this. 

I remember focusing on pages 12 and 13-- 

MR. INSLEE. Today if any CEO in the land, if they see a document 

that says we are considering undercover operations against major media 

outlets in this country, don’t you think that should be a red flag to say, 

should we be doing undercover operations to major media outlets? And 

undercover, to me that means that someone is falsifying their identity or 

falsifying their responsibilities. Are you telling us today had you been 

aware of that, you would have stopped it? Or are you telling us that you 

weren’t aware of that? Or are you telling us that you missed that? Or are 

you telling us that you thought it was okay to think about undercover 

operations, and you would think about it later? Which of those scenarios 

happened here? 

MS. DUNN. What I’m telling you is that I don’t believe I saw this. I 

was not responsible for designing the techniques that Hewlett-Packard 

uses in investigations. And I will strongly affirm your statement that I 

advise--and I think that is what you just asked--other CEOs--I was not 
103

the CEO, but I would advise CEOs that if anyone in their organization 

came to them with this proposal, that they take appropriate action to 

prevent it. 

MR. INSLEE. So if anyone actually--what you’re telling me is if 

anyone in the chain of command saw this proposal, they should have 

shut it down right there; is that a fair statement? 

MS. DUNN. I think that this would have--this would have been and 

should have been a trigger to review the investigative methods at 

Hewlett-Packard from the standpoint of, say, an internal audit review to 

look for, on a risk basis, what was going on there that could put the 

company in jeopardy. 

MR. INSLEE. So while I was introducing a bill on January 31st to 

give us tools to stop pretext calling, which is an undercover device to 

obtain our personal cell phone information, what was HP telling 

Congress about whether or not we should have these tools to stop 

pretexting? What were your lobbyists telling Congress? 

MS. DUNN. I don’t know, sir. I’m not involved in HP’s lobbying 

efforts; I have no role in approving or even being informed about them. 

MR. INSLEE. And what is HP telling Congress now? Should we pass 

this bill that this committee passed back in March? What is your advice 

to us now? 

MS. DUNN. Sir, I think the right person to address that question to is 

Mark Hurd, who is an executive of the company. I am not, was never, 

and I have never been consulted about what HP does in its lobbying 

efforts with Congress. 

MR. INSLEE. Well, what is your personal opinion, if you have one? 

Do you think Congress should give the tools to agencies to stop 

pretexting Americans? 

MS. DUNN. Absolutely. I think as a--here’s what I think, and this is 

in my testimony and my opening statement. I think that the privacy of 

individuals needs to be protected with crystal-clear laws. I also believe 

that companies like Hewlett-Packard need to have a place where they can 

go to have investigations that are necessary to protect shareholder 

interest, accomplished within sanctioned safe harbors. Just like law 

enforcement carves itself out from pretexting laws, there needs to be a 

way for companies to do the kind of investigations they need to protect 

intellectual property and, in this case, repeated, unconfessed serious 

disclosure of confidential company information. 

MR. INSLEE. And do you have any information as to why the United 

States House of Representatives, having had a bill passed to solve this 

problem, introduced the same time that this was going on at HP, why the 

leadership of this House, do you have any information, won’t schedule a 

vote on this bill? Do you have any information why that is? Because, 
104

frankly, it is a mystery to me. I have checked with the Intelligence 

Committee. They said we don’t have a hold on this bill. I asked my 

friends across the aisle. No one admits to having a hold on this bill. And 

I have to tell you, my constituents are tired of a Congress with backroom 

holds put on bills by secret--I don’t know who they are--trying to stop 

this scandalous behavior that’s going on. So I wonder if you have any 

advice about what is stopping Americans from getting this protection? 

MS. DUNN. Sir, if there’s anything I know less about than the details 

on the law on pretexting or the methods that are permissible in 

investigations, it’s how the U.S. Congress passes bills. 

MR. INSLEE. Well, in this case, how they don’t pass bills. 

MS. DUNN. Or how they don’t pass bills. 

MR. INSLEE. That’s the situation. 

MS. DUNN. But I would be happy to talk off line about what I can 

do, if anything, to help you in that matter. 

MR. INSLEE. Well, I hope corporate America, responsible 

corporations, of which there are millions and millions, thankfully, in this 

country, will call Republican leadership in the House of Representatives 

and tell them to get this bill up on the suspension calendar and pass it. I 

have some suspicion that maybe those calls aren’t being made. Maybe 

they are calls with a different message to GOP leadership. 

I don’t know what’s going on here, but I hope that responsible 

corporate leadership will help us pass this bill. And I hope the pain that 

HP is going through today helps that message to get delivered. Thank 

you. 

MS. DUNN. Thank you. 

MR. WHITFIELD. The gentlelady from Tennessee is recognized for 

10 minutes. 

MRS. BLACKBURN. Thank you, Mr. Chairman. And thank you to all 

of you for your patience today. 

Ms. Dunn, to you first, please, ma’am. The document that you 

submitted to us with your testimony on your duties of the independent 

chair, it’s under Tab 3, I want to go, if we can, to that document for a 

couple of questions for clarification for the record. 

First of all, you have said that you were the--your duties as the 

Chairman, and you’ve defined how unusual those duties were. But for 

the record, you were compensated for those duties. You were 

compensated for your Board membership and then compensated for your 

duties, and most of that you took in HP stock, correct? 

MS. DUNN. That is correct. If you would like, I’ll give you some 

details on that. 

MRS. BLACKBURN. Yes, I would. 
105

MS. DUNN. I began as a director at Hewlett-Packard in 1998. I was 

required by the company I worked for to renet I think 25 percent of my 

director’s fees in cash. So I took 75 percent in stock and 25 percent in 

cash. 

By 2002, I was able to take 100 percent of my director’s fees in 

stock. I have received small cash stipends for chairing committee 

meetings along the way; I would say in 8 years, probably a total of 

$50,000 or less as a committee chairman and committee fees, which are 

extra. 

MS. DUNN. And in September, I believe in 2006, for 6 months the 

compensation committee at HP basically forced me to accept an 

additional $100,000 of compensation which I take in stock which are for 

my duties as Chairman. The reason I turned it down was because I 

thought this was a responsibility that ought to rotate among the directors 

and that ought to be done on the basis of the needs of the company. 

MRS. BLACKBURN. I want to go down on this, duties of the 

independent chair, and the first cell in this chart is flow of information to 

the Board. And in this, you state that you oversee the flow of 

information, including the quality, quantity and timeliness from 

management to the Board, and I will have to tell you, it is a--when you 

read the Kona report that is under Tab 29 that we have, and I think 

several of us are going back to page 10 in that report, it does lead me to 

ask, did you make decisions of holding back information about the 

pretexting, or did you decide to leave things off the agenda? Were there 

portions of the report that you chose to share and portions that you did 

not? Would you like to clarify that? 

MS. DUNN. Thank you for giving me the chance to do that. One of 

the pieces of advice that I received earliest in this process from the 

investigative team was that if those who are being investigated, including 

myself, know all of the details about how they are being investigated, 

you no longer have a valid investigation. 

So my approach to balancing my responsibilities to inform the Board 

and not compromise the investigation was to report to the Board at every 

regular meeting between the time that the first investigation began and 

ended that an investigation was underway, so-- 

MRS. BLACKBURN. So you basically distilled the information and 

then brought forward what you felt was appropriate? 

MS. DUNN. Especially that they had to know I had responded to 

their request and I was taking steps. 

MRS. BLACKBURN. Okay, the last cell in your duties of the 

independent chair, the CEO evaluation, was the Kona project included in 

Mr. Hurd’s evaluation? 

MS. DUNN. It was not. 
106

MRS. BLACKBURN. So it was never referenced-- 

MS. DUNN. Never. 

MRS. BLACKBURN. In the evaluation. What about for his 

predecessor? 

MS. DUNN. Never. 

MRS. BLACKBURN. Never. So it was never mentioned, it was totally 

off the record, off the book? 

MS. DUNN. Well, let me say that with respect to Ms. Fiorina’s 

reviews, I don’t know that they were ever written. If they were I was 

never privy to them. But I have no reason to think that anything related 

to investigating Board leaks was ever a part of the review process with 

her. And the same is true for Mr. Hurd. And as important as this matter 

is to us now, I will tell you that this never rose to the level of significance 

to focus on as a matter of performance by our Board the last time he 

received a review. 

I suspect it will the next time. 

MRS. BLACKBURN. You had mentioned and testified earlier in 

response to Chairman Barton’s question that it was your intention that 

the investigation be carried out ethically or legally and in the Kona report 

on page 10, you--in talking about this, the report that was given to you, 

contact established covertly with DK, a nontraceable Hotmail e-mail 

account, a dialogue has been established further planning of this 

operation is in progress. 

Does that sound like it is ethical? Do you believe that to be an action 

item that would be ethical? 

MS. DUNN. That rang a bell with me, which is why just as in every 

other case, I did not see myself as the right person to approve methods. I 

am not in charge of investigations at Hewlett-Packard. I referred the 

matter to management. 

MRS. BLACKBURN. Mr. Sonsini, when was the first time that you 

heard anything about this investigation? 

MR. SONSINI. The first time I heard about the Kona 1 and Kona 2 

investigations, I believe was a note I received from Pattie Dunn on or 

about March 15th of this year. 

MRS. BLACKBURN. So it would have been prior to the June 19th

e-mails that are in here? 

MR. SONSINI. Yes. 

MRS. BLACKBURN. All right, and your e-mail, which is Tab 91, I 

think the square, I have got a couple of questions about this, point 

Number 5 in this e-mail where you are talking about the investigating 

team did obtain information regarding cell phone calls that were made. 

You say in here on that point the legal team also checked with outside 

counsel as to the legality of this methodology. 
107

Other than you, sir, who was that outside counsel? 

MR. SONSINI. Well, I subsequently learned that the outside counsel 

referred to was counsel--made by John Kiernan. I believe that he was 

counsel specifically to the investigating, lead investigator, Mr. DeLia. 

MRS. BLACKBURN. So that was a separate outside counsel, it was 

not you, and you have represented yourself as being outside counsel to 

the Board. 

MR. SONSINI. I am one of many outside counsels that 

Hewlett-Packard uses, yes, but this reference is clearly not to Wilson 

Sonsini. 

MRS. BLACKBURN. And then point number 6 you--point number 4 

and point number 6 in that e-mail, where you have the investigating team 

did not attempt to obtain the phone records of nonemployee directors in 

point number 6, there was no secret spying example, no electronic gear. 

Do you now agree that those were false assumptions? 

MR. SONSINI. I think our subsequent investigation clearly is at odds 

with these conclusions at that time, yes. 

MRS. BLACKBURN. Okay. 

MR. SONSINI. And these conclusions at the time, as my e-mail points 

out, are based upon two separate reports I received from the HP legal 

department in response to my questions: What was going on? 

MRS. BLACKBURN. Did you know those were false before the 8/21 

memo, the Number 115 went out, this item Number 115 in our book? 

Did you know that those were false at that time? 

MR. SONSINI. Well, this all came to light during my investigation, 

which took place between August 9th, I believe, and August 23rd, so that 

is the period of time that this came to light to us. That is when we 

conducted an independent investigation as to the methods employed and 

when we began to learn, and I began to learn exactly what the 

methodology was. 

MRS. BLACKBURN. Okay. You know, it is so interesting to me to 

listen to your testimony and how you came to the awareness of what 

pretexting was, had you ever heard of it before this took place? 

MR. SONSINI. No ma’am, I did not. Not at all. I wasn’t familiar, 

quite frankly, with sub-rosa investigations. In 40 years of practicing law 

I have never been involved in one. 

MRS. BLACKBURN. I find it so interesting because in your e-mail, 

you seem to chastise Mr. Perkins for questioning, and while at the same 

time, you seem to give a confidence that there is no legal issue that 

would surround this, that the company’s Board Chairman really didn’t 

understand or know the details of the program either, but that everything 

seemed to be legal, even though you give yourself some cover in saying 

that you weren’t involved in the formulation of plan. 
108

So it leads--as we are trying to work through this pretexting issue, 

you know, you seem to contradict yourself several times within the 

e-mail as to your level of understanding of what this is. And maybe even 

your doubts, and I think that is one of the reasons that we are here. 

MR. SONSINI. With all due respect-- 

MR. WHITFIELD. Gentlelady’s time has expired, but I would like 

you to answer the question. 

MR. SONSINI. With all due respect, I am not chastising Mr. Perkins. 

Quite the contrary. I am being forthright as I can be to lay out to him 

everything that is going on. I am the first person to surface to him and to 

anyone that pretexting was taking place based upon the information I got 

from HP. That is first. 

Secondly at this point in time, I had conducted no inquiry. I wasn’t 

asked to conduct any inquiry. I was not knowledge--had no knowledge 

of the methodologies used. I was relying upon the HP legal department. 

And I required not just a telephone call--I required two separate reports 

confirming what they did so I could pass it on. 

I was, as my e-mail points out, being transparent with Mr. Perkins in 

response to his questions. There is no inconsistency whatsoever in my 

conduct at this time. If we look at the investigation that I did do, which 

has been referred to and turned over to the staff, you will see it was then 

that we were quite clear as our views on the situation. 

MR. WHITFIELD. At this time, I recognize the gentlelady from 

Wisconsin for 10 minutes. 

MS. BALDWIN. Thank you, Mr. Chairman. 

Ms. Dunn, I wanted to ask this question to Ms. Baskins, but earlier 

today, she pled the Fifth, so I am going to ask you. There was a press 

conference last week conducted by Mr. Hurd and an attorney from the 

law firm of Morgan Lewis. 

At that press conference, there was an indication that a draft of the 

Kona 2 investigation was prepared in early 2006. Is that correct? 

MS. DUNN. I think the first--sorry, the first report which was titled 

“Final Draft” was dated either March 14th or March 12, 2006. 

MS. BALDWIN. Could you turn to page--I’m sorry, Tab 72 of the 

document book. And this appears to be something labeled draft, not final 

draft. And it is dated March 10th directed to Pattie Dunn, Mark Hurd 

and Ann Baskins. Is that the document-- 

MS. DUNN. Yes, I stand corrected on the date. 

MS. BALDWIN. And do you believe you possibly received it around 

March 10th or on March 10th? 

MS. DUNN. Yes, I do. 

MS. BALDWIN. Ms. Dunn, can you tell me whether you met with 

Mr. Hurd to discuss this draft report at this stage of the investigation? 
109

MS. DUNN. Yes. After this report was issued, I am sorry I am not 

remembering the date, but it is in my written testimony, there was a 

meeting between myself, Ms. Baskins, the investigative team. It took 

place in Los Angeles. It was around March 15th or 16th. 

MS. BALDWIN. And can you share with the committee the nature of 

that discussion? 

MS. DUNN. Once again, it focused on the results. We were upset 

about this matter. We were upset that we were going to have to ask a 

long-standing Board member to come forward and acknowledge after 

having allowed this investigation to go on with his knowledge for a year. 

MS. BALDWIN. Ms. Dunn, at the time this draft was presented to you 

and to Mr. Hurd and to Ms. Baskins, who specifically was doing the 

legal analysis to ensure that the investigative methods detailed in this 

report were legal? Whose job was that? 

MS. DUNN. From my perspective, I was relying on Ann Baskins. I 

believe she was relying on Mr. Hunsaker. 

MS. BALDWIN. According to the same Morgan Lewis 

pronouncement last Friday, in April of 2006, this report was also 

provided to an outside corporate counsel. Is that correct? 

MS. DUNN. It was provided to Mr. Sonsini as well as to the 

chairman of HP’s Audit Committee. 

MS. BALDWIN. And can you tell me who and what was the role that 

they were to play having been provided this report? 

MS. DUNN. We, the group I will name, Mr. Sonsini, Mr. Ryan, 

myself, Mr. Hurd and Ms. Baskins, met at HP some time in late April, I 

believe, to discuss the way forward, given the results of this report. 

MS. BALDWIN. Mr. Sonsini, when you received this draft--you 

should look at the document book also. And do you recognize that 

document and recall having received it? 

MR. SONSINI. I do. 

MS. BALDWIN. Okay. When you reviewed that, what did you think 

when you saw on page 3, a bullet point at the bottom of that page: 

“obtained, reviewed and analyzed HP and third-party phone records to 

identify calls made to or from reporters or other individuals of interest 

during the relevant time frames.” And then on page 4: “obtained 

reviewed and analyzed--oops, I am sorry--engineered and executed a 

covert intelligence-gathering operation pursuant to which an undercover 

investigator established e-mail contact with Kawamoto, the CNET 

reporter using an untraceable Hotmail account.” The operation included 

placing a legally permissible software tracing device in an e-mail 

attachment sent to Kawamoto? 

MR. SONSINI. Yes. When I got the report, I got the report, as Pattie 

Dunn has indicated, with a view of what do we do with the result that we 
110

now have discovered the person who leaked the information, what do we 

the with the result in terms of a corporate governance point of view 

going forward? 

And I did not focus--other than on the words and the footnotes 

saying that it was lawfully done--on this sub-rosa investigation. It 

certainly seemed to me to be somewhat over the top. But my focus at the 

time because I am not an expert in such matters, and they would not send 

this report to me to comment upon those kinds of issues, my focus was I 

was dealing now with a serious corporate governance issue. I’ve got a 

problem. 

MS. BALDWIN. I, of course, am focusing on what you didn’t focus 

on. So I guess I want to explore that a little bit further, because this 

document was now available to you and to a number of others. Who was 

in charge of making sure that--making sure that this--the tactics used 

were legal and once this was disclosed back in March, who pursued 

questioning the legality of the techniques? 

MR. SONSINI. I think the record has become quite clear that who was 

in charge was the Hewlett-Packard internal legal department. They took 

the responsibility on rightly, wrongly, that’s what happened. I came in 

after the fact and learned that. 

So that is who is in charge. 

MS. BALDWIN. Ms. Dunn, on May 24, 2006, Mr. Kevin Hunsaker 

produced a final report of the Kona investigation, isn’t that correct? 

MS. DUNN. Yes. There was nothing to the best of my knowledge 

that went on from an investigation standpoint from March 10th to the 

final report. I believe the only thing that was left to finalize it were the 

results of Mr. Ryan, the Chairman of the Audit Committee, interview 

with Mr. Keyworth. 

MS. BALDWIN. And if you could turn to Document 89, I just would 

like to make sure that we are referring to the same document. 

MS. DUNN. Yes, we are. 

MS. BALDWIN. So that is the final report. 

And on page 4 of that document, we see obviously the final language 

here, but it indicates that HP obtained, reviewed and analyzed HP phone 

records and third-party phone information to identify calls made to or 

from reporters or other individuals of interest during the relevant 

timeframes. 

Ms. Dunn, when was the earliest that you knew that HP employees 

either directly or through outside investigators were obtaining third-party 

phone records? 

MS. DUNN. As I have testified and in my written testimony as well, I 

became aware that phone records were a part of this investigation in circa 

June 2005. 
111

MS. BALDWIN. When you read this bullet point in the final report, 

were you troubled by that? 

MS. DUNN. I need to find the exact bullet point, but I was certainly 

not surprised that phone records were involved. I had known that for 

9 months. 

MS. BALDWIN. On that same report, page 4, third bullet point down, 

again, I will read it for the record, “engineered and executed a covert 

intelligence-gathering operation pursuant to which an undercover 

investigator established e-mail contact with Kawamoto, the CNET 

reporter using an untraceable Hotmail account, the operation included 

placing a legally permissible software-based tracing device in an e-mail 

attachment sent to Kawamoto.” 

Were you troubled by this bullet point in the report? 

MS. DUNN. I saw that. Remember the first time I became aware of 

that technique was back in February. And that is when I referred it on. I 

did not see myself at any point as having a role in approving methods. I 

wanted the HP standard ways of doing these investigations to be used to 

investigate a standard of business conduct violation at the Board level. 

The Board is--the Board signs up to the same standards of business 

conduct as every other employee. And my view was what HP does 

normally to investigate these matters is the appropriate thing to use in 

this matter concerning our Board. That judgment may be seriously 

questionable in retrospect but it was my judgment at the time. 

MS. BALDWIN. One closing question. How did you come by the 

name Kona 1 and Kona 2? 

MS. DUNN. The first time I spoke with Mr. DeLia, which I believe 

was some time in possibly April of 2005, I was on vacation in Kona. 

The name Kona will never mean the same thing to me again. But he said 

you know when we do this work we always assign a project name to it. 

Do you have any preferences? And I looked down at the piece of paper 

in front of me and it had something about Kona and I said Kona. 

MR. WHITFIELD. Chair recognizes Mr. Burgess for 10 minutes. 

MR. BURGESS. Thank you, Mr. Chairman. Thank you all for being 

here and your forbearance; we do appreciate you providing answers to 

our questions. 

Mr. Adler, I don’t want you to feel left out, so let’s talk for a minute. 

Can I ask you for a minute do you have the big book in front of you? 

MR. ALDER. No, I do not. 

MR. BURGESS. Can I ask you to get a copy of the big book and turn 

to Tab 20? 

MR. ALDER. Did you say page 20, sir? 

MR. BURGESS. Tab 20 in the great big book in front of you. Not 

printed on the Heidelberg press. 20. 20. Two zero. 
112

And in this e-mail, Mr. Hunsaker asked whether there is any way to 

lawfully get text message content or is it the same as cell phone records, 

did that suggest to you that he believed accessing cell phone records was 

illegal? 

MR. ALDER. Sir, could you please restate your question? I want to 

make sure I perfectly understand you. 

MR. BURGESS. Well, you say here, Mr. Hunsaker says in the 

message or the message to Mr. Hunsaker says: “Even if we could legally 

obtain the records,” did you have a reason to suspect that the obtaining of 

the records would be other than legal? 

MR. ALDER. I am sorry. I am not trying to be smart about this. I do 

have a slight hearing deficit and I am having difficulty. 

MR. BURGESS. Let me speak slowly in simple declarative sentences. 

When Mr. Hunsaker asked whether “Is there any way to lawfully get text 

message content or is it the same as cell phone records?” Did that 

suggest to you that he believed accessing cell phone records was, in 

itself, illegal? 

MR. ALDER. I don’t fully understand the question. 

MR. BURGESS. Okay, we are not going to get an answer. Let’s go to 

Tab 40, if you don’t mind. Can I ask you to turn to Tab 40 in your book? 

MR. ALDER. Thank you. 

MR. BURGESS. Right in the middle of the page, under--there is a 

heavy line there and it says from Adler, Frederick P, which I assume is 

you, right, just below the middle of the page it says: “agreed I am very 

concerned about the legality of this information.” 

MR. ALDER. Yes, sir. I see it. 

MR. BURGESS. Can you tell us what you were concerned about? 

MR. ALDER. This message occurred between myself and my coinvestigator, Vincent Nye. This message went back and forth between us 

after a meeting on February 7th between the investigative, the leak, 

undisclosed leak investigation team consisting of myself, Mr. Nye, 

Mr. Hunsaker, Mr. Gentilucci and Mr. DeLia. 

It was at that meeting that we had, that both myself and Mr. Nye had 

started questioning Mr. Gentilucci and Mr. DeLia and Mr. Hunsaker 

about the pretext calling and how the information was being obtained 

and whether it was in compliance with law. 

MR. BURGESS. What did you do to ensure yourself that it indeed 

was in compliance with the law? 

MR. ALDER. This issue had already been broached the previous day 

with a statement by, I believe it was Mr. DeLia, that they had obtained 

call information from the personal call information belonging to 

Mr. Keyworth. That was the first time that I had been aware of any such 

activity. 
113

MR. BURGESS. Mr. Adler I want to interrupt you because of the 

interest of time, and I do have a follow-up question that I am going to 

submit in written form, and ask if you would--if you wouldn’t mind 

providing us an answer, but I am going to ask you a series of questions 

and it should go fairly quickly. 

At any point during the Kona 2 investigation, did anyone say, what 

we are doing is just crazy? 

MR. ALDER. Essentially, myself and Mr. Nye did. We went to--we 

went to--Mr. Nye went to Mr. Gentilucci, as we have already seen 

testimony up here today in evidence of. I went to my manager late on 

the 6th or early on the morning of 7 February, 2006, and told them I was 

deeply troubled and concerned about what happened. Shortly thereafter, 

Mr. Nye also contacted my manager after not receiving satisfaction 

through his manager, Mr. Gentilucci. My manager, Timothy O’Neill, a 

former law enforcement officer, also became very concerned with what 

was occurring. And he said that he would go forward with our concerns. 

He made contact with both Mr. Gentilucci and with counsel, which was 

Mr. Hunsaker, and expressed his concerns. 

MR. BURGESS. What was Ms. Dunn’s level of involvement in the 

Kona 2 investigation, to the best of your recollection? 

MS. DUNN. The suspense level? 

MR. BURGESS. No, her level of involvement in the Kona 2 

investigation? 

MR. ALDER. The level of whose involvement? 

MR. BURGESS. Patricia Dunn. 

MR. ALDER. I have only hearsay to offer to Mr. Hunsaker’s 

statements, and that was she was being reported to during the course of 

the investigation as to our progress, and at the end of the investigation, 

she was given a report as to our findings. 

MR. BURGESS. Did you attend any of the meetings with Ms. Dunn 

about the investigation? 

MR. ALDER. No, I did not. 

MR. BURGESS. During the course of the Kona 2 investigation, was 

Ms. Dunn aware that pretexting was being utilized to access personal 

telephone records? 

MR. ALDER. I have no knowledge of that. 

MR. BURGESS. Would that be included in that report that you just 

referenced? 

MR. ALDER. The pretexting? 

MR. BURGESS. Yes. 

MR. ALDER. It could be. 

MR. BURGESS. Do we have a copy of that report? 
114

MR. ALDER. I believe--well, I don’t know. It was in my e-mail, but 

I know the committee has received quite a bit of it, so I don’t know. 

MR. BURGESS. Well, did Ms. Dunn have to approve certain aspects 

of the investigation before you could proceed? 

MR. ALDER. I don’t know. That was between Mr. Hunsaker and 

Ann Baskins and Ms. Dunn. I have no knowledge. 

MR. BURGESS. Two of those individuals took the Fifth Amendment, 

so I didn’t have a chance to question them, so that is why I am asking 

you to help with that. 

MR. ALDER. I understand. 

MR. BURGESS. Who came up with the idea of the embedded 

tracking device? 

MR. ALDER. That was my idea. 

MR. BURGESS. And we have heard this referred to previously as a 

legally permissible-- 

MR. ALDER. Yes, at the time I understood it to be a legally 

permissible way to obtain information. And I still believe it to be as 

such. It is--it was and still is sanctioned by my management as an 

investigative tool. We have used it in the past for investigations for 

determining locations of stolen product and what not. We have also 

assisted law enforcement. We have recently recovered an at-risk child 

with the same technology. 

MR. BURGESS. But who has to approve the use of that--who has to 

approve the use of the tracking device; it is almost like putting a wiretap 

on your phone Mr. Alder. 

MR. ALDER. I beg your pardon, sir. 

MR. BURGESS. To me, to a lay consumer, that is akin to someone 

putting a wiretap on my phone. 

MR. ALDER. A wiretap is normally considered a real-time 

interception. This is not a real-time interception. It is also the 

interception of personal data. We did not intercept any personal data. 

MR. BURGESS. Mr. Adler, it is equivalent to going through the mail 

in my mailbox. 

MR. ALDER. I didn’t go through your mail. 

MR. BURGESS. Let me ask you this. Can you turn to Tab 50 for a 

moment. So there will be no question in anyone’s mind what we have in 

front of us, this looks to be a how-to kit on how to put this tracking 

device in a zip file and attach it to an e-mail. Is that correct? 

MR. ALDER. That is correct. 

MR. BURGESS. And these are instructions that were sent by you to 

Mr. Hunsaker and Mr. Gentilucci and Mr. Nye and other people who 

took the Fifth Amendment earlier? 

MR. ALDER. Correct. 
115

MR. BURGESS. Does Patricia Dunn know that this recipe was being 

forwarded and utilized? 

MR. ALDER. I have no idea. 

MR. BURGESS. Ms. Dunn, do you know? Do you have Tab 50 in 

front of you? Do you have Mr. Adler’s e-mail? 

MS. DUNN. I was not copied on this e-mail and I am seeing it for the 

first time here. 

MR. BURGESS. So this was not something you had been aware of 

before today? 

MS. DUNN. No, sir. 

MR. BURGESS. Does this strike you as being a permissible tactic to 

use, attaching a tracking device onto an e-mail? It is going to give me 

the creeps to think someone would do that. Does it bother you? 

MS. DUNN. It is kind of surprising that it is legal, isn’t it? 

MR. BURGESS. Ms. Dunn, Hewlett-Packard has acknowledged that 

the personal telephone records of several directors and employees were 

accessed during the Kona investigations. 

I would like to read to you written testimony provided by Scott 

Taylor the chief privacy officer of Hewlett-Packard, during a hearing of 

this committee’s Subcommittee on Commerce, Trade, and Consumer 

Protection. This occurred back in June, and I quote. “As a company, 

Hewlett-Packard is 100 percent committed to excellence in consumer 

and employee privacy for two fundamental reasons: First, because it is 

the right thing to do. We have an obligation to fulfill the trust that 

Hewlett-Packard employees have given us in handling their 

information.” 

I would ask you, would you agree that accessing personal phone 

records of your employees and directors is a major breach of trust? 

MS. DUNN. It should never have happened. I would like to add that 

99.999 percent of Hewlett-Packard’s employees live up to the statement 

you just read every day. 

MR. BURGESS. I thank you. Mr. Chairman, if I can make one 

observation, this is a day I guess that the stock market is going to crest at 

a historic high that it hasn’t seen since the year 2000. And we all recall it 

was in part the lack of corporate self-governance that brought the stock 

market low after its all time high of 11,700, whatever it was back in 

March of 2000. We have recovered from that corporate problem. We 

have recovered from 9/11. We have recovered from the dot com bubble. 

Please don’t take us down that path again. I yield back. 

MS. DEGETTE. Mr. Chairman, I would ask unanimous consent for 

1 minute to follow up on Mr. Burgess’ question, to ask Mr. Adler a 

question. 

MR. STEARNS. I object. 
116

MR. WHITFIELD. You object? Ms. Eshoo, I said I was going to go to 

you next, but it is our procedure to allow the members of the Oversight 

Committee to finish first, so at this time I recognize Mr. Stearns for 

10 minutes. 

MR. STEARNS. Mr. Chairman, I am going to give unanimous 

consent to the gentlelady to ask her question. 

MR. WHITFIELD. Ms. DeGette is recognized for 1 minute. 

MS. DEGETTE. Mr. Adler, I heard you testify in response to 

Mr. Burgess that this embedded technology is a technique used quite 

frequently. Is that correct? 

MR. ALDER. I believe it to be so. There is a site called 

readnotify.com. 

MS. DEGETTE. How long have you worked at Hewlett-Packard, 

Mr. Adler? 

MR. ALDER. A little bit over 3 years now. 

MS. DEGETTE. And how often have you used this technique of 

embedded technology to trace e-mails during your employment at 

Hewlett-Packard? 

MR. ALDER. Personally? 

MS. DEGETTE. Personally or your--that you know of. 

MR. ALDER. I would have to venture a guess at maybe a dozen, 2 

dozen times. 

MS. DEGETTE. And in what circumstances? 

MR. ALDER. In investigating corporate issues such as theft, as I said. 

Also we assisted law enforcement, just recently in locating an at-risk 

child with the technology. It is-- 

MS. DEGETTE. Have you used it to investigate internal leaks before 

this particular situation? 

MR. ALDER. No, we have not, not to my knowledge. 

MS. DEGETTE. Thank you. 

MR. WHITFIELD. Mr. Stearns. 

MR. STEARNS. Thank you Mr. Chairman. 

Mr. Sonsini, let me just ask this question. In your written testimony, 

you say that the use of pretexting and similar intrusive investigative 

methods in these circumstances is wrong. Is that correct? 

MR. SONSINI. Yes. 

MR. STEARNS. In Exhibit 91, however, you conclude that “the 

process was well done and within legal limits.” So I guess the question 

is what has changed between then and now? Do you want to see that 

Exhibit 91? 

MR. SONSINI. No, I am familiar with it, Congressman. At the time 

of that communication, I think you are referring to my June e-mail to 

Mr. Perkins, I was relying upon the HP legal department in responding to 
117

me when I asked how should we respond to Mr. Perkin’s concerns? Tell 

me what you have done? 

I received a written report from Mr. Hunsaker who oversaw the 

investigation. I received a written report from Ann Baskins of the 

General Counsel. I spoke to Ms. Baskins and I asked for repeated 

assurances: do you believe that this was all done properly? I then took 

that information without any independent investigation, and sent the 

e-mail to Mr. Perkins and it says “it appears.” “It appears.” 

MR. STEARNS. Can I safely say that at that point you felt you were 

within your legal limits to do this? 

MR. SONSINI. Yes. I was asked to do this by Ann Baskins. I was 

asked to respond to Mr. Perkins. 

MR. STEARNS. So what--knowing what you know today and what 

you said in your testimony, you stand by the position now that it is 

wrong, right? 

MR. SONSINI. Absolutely. After we did conduct an investigation 

and I had the opportunity to look into the matter and had the opportunity 

to research the law, and do our investigation, we concluded quite the 

contrary. 

MR. STEARNS. At the time of these investigations were you aware 

that several States including Florida, California and Georgia were 

considering legislation that would specifically ban pretexting for 

telephone records? 

MR. SONSINI. I subsequently learned that. When we did our 

investigation in August, we looked at those statutes and we saw that the 

law was rapidly changing in the country regarding pretexting. That’s 

correct. 

MR. STEARNS. Perhaps you heard my opening statement. I 

mentioned a California statute that said it was wrong to do this. And that 

was in play when you were previously involved, in fact, when you said 

that you thought it was legally acceptable. Did you know about that 

statute back then? 

MR. SONSINI. No, I didn’t, sir. As I indicated, I didn’t know about 

the methodologies going on then and I am no expert. I didn’t even know 

the law of pretexting at that point in time. It wasn’t until we did our 

investigation in August that I became cognizant of it. 

MR. STEARNS. Ms. Dunn, knowing what you know today, is it your 

position that pretexting is wrong today? 

MS. DUNN. Yes, sir, it is. 

MR. STEARNS. So you are categorically saying it is wrong? 

MS. DUNN. It is fraud. It is the fraudulent misrepresentation of 

identity. It is wrong. 
118

MR. STEARNS. And knowing what you do today you would not have 

let these investigators do this? 

MS. DUNN. I would have gone through the management chain. I did 

not supervise the investigators, but I would have either brought it to the 

attention of the Chairman of the Audit Committee or to the CEO if I 

thought fraud was involved. 

MR. STEARNS. I would think that since you--and you authorized it--

they would report to you regularly. Didn’t they do that with progress 

reports? 

MS. DUNN. They did provide me progress reports, but I was not the 

supervisor of this investigation. I had no role in management. Other 

people were involved in managing the investigation, choosing the 

techniques. 

MR. STEARNS. But you got progress reports, didn’t you? 

MS. DUNN. I got just updates, and I was focused on the results. 

MR. STEARNS. Were briefings given to you? 

MS. DUNN. I had--I think there were three meetings over the course 

of-- 

MR. STEARNS. So you had three briefings by-- 

MS. DUNN. The course of 13 months. 

MR. STEARNS. Okay. And the 3 briefings, did they ever tell you 

how they got the information? 

MS. DUNN. I was told in I think it was April or May, I have testified 

earlier, April 2005, that phone records were involved and I was informed 

of that by Mr. DeLia. 

MR. STEARNS. I think honestly, if you were notified that they were 

even doing pretexting, I am not sure you or many people would even 

know that that was wrong at that point, because you know when 

pretexting came up on our committee, a lot of us didn’t know what it 

was. And when we heard it and we had a chance to think about it, we 

understood it was wrong, but I mean it is such a serious way that 

investigators do this that it has probably become widespread. 

MS. DUNN. If I may offer, I think, the word “pretexting” is a pretext. 

It is meant to confuse. 

MR. STEARNS. Yes, I understand that. 

Ms. Dunn, your written testimony is 33 pages long. You go into 

great detail explaining why the investigation was necessary and how you 

were assured that these aggressive tactics were legal. You even advocate 

congressional action to produce clear-cut rules on pretexting, a 

suggestion that this committee has endorsed. However, conspicuous by 

its absence in your testimony is any degree of contrition or acceptance of 

responsibility. 
119

And I have listened to this testimony in my office, and you have just 

indicated it is wrong. You indicated you had been briefed three times, 

and yet, there is no suggestion that you are going to accept any 

responsibility and no sense that what you did was wrong. So I get the 

sense after reading your testimony that you still do not really believe that 

you did anything wrong here. And I guess that is a question. 

Do you feel that you are totally innocent here and with no 

culpability? 

MS. DUNN. My understanding is that my opening statement is a part 

of my full submission. 

MR. STEARNS. Ms. Dunn, if I-- 

MS. DUNN. May I answer your question, sir? 

MR. STEARNS. I am asking the questions. The question I want is yes 

or no, do you think that your--have any culpability in this whole fiasco? 

Just yes or no. 

MS. DUNN. I will repeat what I said in my opening statement. I 

deeply regret that so many people were badly affected. 

MR. STEARNS. We are not talking about other people. We are 

talking about you personally. 

MS. DUNN. Including me, that was said in my opening statement. 

And I would like to tell you what I would do differently-- 

MR. STEARNS. But regret is one thing, but culpability that you 

accept blame is another, and I am just trying to think--and I know, I 

mean, you could say you are not blamable. You can say that, but I am 

just trying to put on the record whether you think you are at fault for 

anything, other than regrets and you are sorry and things like that. 

Is it just possible you could say yes or no, that you feel you have 

some culpability? 

MS. DUNN. If I knew then what I know now, I would have done 

things very differently and there are some specific things I would have 

done very differently. 

MR. STEARNS. I am interpreting that-- 

MS. DUNN. It is a foundational component of corporate governance 

that directors must rely on the reasonable representations of 

management. 

MR. STEARNS. But-- 

MS. DUNN. And those I did have. 

MR. STEARNS. I am interpreting what you say is that knowing what 

you know today it was wrong? 

MS. DUNN. Absolutely. 

MR. STEARNS. And knowing what you do today that you have to 

accept responsibility, you have to accept personal responsibility for what 
120

happened. That is my interpretation of what you are telling me. Is that a 

correct interpretation? 

MS. DUNN. Sir, I do not accept personal responsibility for what 

happened. 

MR. STEARNS. Okay, okay. Mr. Chairman, I think she is basically 

saying she is not culpable here, and she accepts no responsibilities for 

what occurred. I understand. 

Now, under the circumstances, considering how you feel, wouldn’t 

it, at this point, occur to you that you might want to resign because of all 

these problems? 

MS. DUNN. I have done so, sir. 

MR. STEARNS. Okay. Okay. Okay. 

MS. DUNN. I will do so again, if you like. 

MR. STEARNS. I guess, in your opinion, now you can tell me why 

you resigned. 

MS. DUNN. I resigned because the Board of Hewlett-Packard asked 

me to resign a week ago Friday. Last Friday. 

MR. STEARNS. And why do you think they asked you to resign? 

MS. DUNN. Because they had voted twice in the prior 2 weeks. I am 

not sure if it was a vote, but I had heard that they unanimously supported 

me to remain as Chairman and Director until about 10 days ago, in which 

case, by which time the press reaction to all of this had become so 

intense that we agreed I should step down as Chairman in January. But I 

was asked to remain as a director by many directors. 

The press reaction became more and more and more intense. And I 

think that finally, the Board decided I was a major distraction to the 

company getting over this problem. They asked me to resign and I 

accepted their decision. 

MR. STEARNS. Let me ask one more question. Let me just say that, 

somehow in my personal opinion, that I have great empathy for you, 

because I have seen, I have been in these oversight committees enough to 

know that very competent innocent people get caught up in things they 

don’t understand, but let me, Mr. Chairman, get my one last question in 

here. 

Ms. Dunn, your written testimony says repeatedly that you received 

assurance that the tactics used in the investigation were both common 

and legal, but I would like you to turn to Exhibit 39. Exhibit 39, in this 

e-mail, one of the investigators, Vince Nye, expressed serious 

reservations about what was being done to gather phone records. 

He says “it is very unethical at the least, and probably illegal. If it is 

not totally illegal, then it is leading Hewlett-Packard in a position that 

could damage our reputation or worse.” 
121

So my question is, even if you had been told that these tactics were 

legal, why was Mr. Nye apparently the only one to consider the negative 

publicity that might be generated and how that might harm the company? 

Wasn’t that your job there to act and do something based upon that 

Exhibit 39? 

MS. DUNN. The first time I heard that any member of this 

investigative team had concerns about its legality was from my lawyer 

this morning, who read it in The Washington Post, and maybe less than a 

week ago, I read a report that Mr. Adler had expressed concerns. There 

was never any hint that anyone at Hewlett-Packard had concerns. Quite 

to the contrary. 

MR. WHITFIELD. The gentleman’s time has expired. Since all 

members of the Oversight Subcommittee have asked questions, I 

recognize Ms. Eshoo for 10 minutes. 

MS. ESHOO. Thank you, Mr. Chairman, very much. Thank you to 

the witnesses. 

Ms. Dunn, I want you to know that I have a great deal of respect for 

what you have done with your life. 

MS. DUNN. Thank you. 

MS. ESHOO. You have I think been absolutely remarkable from 

where you began, very humble beginnings and culminating with the 

chairmanship of the Board of Directors of one of the most prestigious 

companies in the world. I want you to know I respect that. 

And again, I have this heaviness about me because I think this is 

enormously sad. I just want to make a couple of observations. 

There are teams and teams and teams of lawyers around every 

company, corporation, publicly held entity, and I guess that is the way it 

needs to be. But I think that when you drill down in this, that there is 

some lawyer from some shoe box outfit in Massachusetts that people 

ended up relying upon for legal advice. 

And I think that that should send a huge message to the company--

and to all companies--that, as one of my colleagues said, none of these 

things should be circular. People are relying from one memo to another. 

But there is that whole the human interaction of taking time to be 

thoughtful and say, besides being legal, is this right? Is this right? 

That is why there is so much regret about this. Someone said to me 

many, many years ago, whatever you do, Anna, always remember, 

picture it above the fold on the front page of the newspaper, what you 

say, what you write, what you think and what you act on. And I think 

that is a lesson for all of us, there isn’t anyone in this hearing room that is 

perfect. This is a manifestation of how less than perfect human beings 

are, even those that are in the highest reaches of corporations and law 

firms. 
122

So with that, Mr. Adler, can you hear me? 

MR. ALDER. Yes, ma’am. 

MS. ESHOO. I would like to ask you a couple of questions about this 

whole investigative arm of HP. How long has HP had a retainer contract 

with either SOS, ARG or Eye in the Sky? 

MR. ALDER. I am afraid I can’t answer the question because I don’t 

have the information. That was all done through, I believe, Mr. 

Gentilucci. 

MS. ESHOO. Well, maybe we can find out from Mr. Hurd. Do you 

know if these companies have been on retainer with HP and if so, for 

how long? 

MR. ALDER. I am sorry, I don’t have that information either. 

MS. ESHOO. How long have you worked for HP? Have you worked 

for HP? 

MR. ALDER. I am sorry. I worked for HP over 3 years. 

MS. ESHOO. And prior to this explosion of this scandal, as an 

employee in your position had you ever heard of any of these people that 

were on retainer? 

MR. ALDER. Yes, I had previously been on an investigation where it 

was a group, more or less of a better word, task force. 

MS. ESHOO. How did you use them? 

MR. ALDER. Mr. DeLia SOS, a/k/a SOS, was responsible for 

providing background information during the course of the investigation. 

MS. ESHOO. Are you aware of any pretexting ever going on through 

contracting with these outfits, outside of Kona 1 and Kona 2? 

MR. ALDER. No, not until February 6th of this year. 

MS. ESHOO. When you say you were concerned, what did you do 

about your concern? 

MR. ALDER. I went to my manager and-- 

MS. ESHOO. And he was or she was? 

MR. ALDER. He is. 

MS. ESHOO. He is -- 

MR. ALDER. Timothy O’Neill, and Mr. O’Neill recognized my 

concerns. Mr. Nye also went to Mr. O’Neill, as I stated earlier, since 

Mr. Gentilucci wouldn’t listen to us. 

MS. ESHOO. Was it ever kicked upstairs? This is another circle, see, 

where people are concerned but something is not happening with it. Was 

it ever kicked upstairs? 

MR. ALDER. This is a rather unique circumstance. 

MS. ESHOO. It sure is. 

MR. ALDER. It was very confidential. There were a limited amount 

of people who knew about it. Mr. Hunsaker was counsel and so we 

knew, we, meaning Mr. O’Neill and myself and Mr. Nye, that if we had 
123

gone directly to Mr. Hurd or Ms. Dunn or Ms. Baskins with our 

concerns, they would have immediately gone back-- 

MS. ESHOO. I can tell something didn’t happen with it. 

Let me go to Mr. Sonsini. It is good to see you. 

MR. SONSINI. Thank you. 

MS. ESHOO. It is a long way from Palo Alto to this hearing, but at 

least the weather is beautiful. It is like Palo Alto here today. 

MR. SONSINI. Wonderful. 

MS. ESHOO. There is a quote that is attributed to you over and over 

and over again in the press. I think that it was, I know that it was 

referred to today. I don’t have the big briefing book in front of me with 

the different sections in it. But essentially it has been attributed to you 

that pretexting was legal. 

Can you speak to that just briefly? I have some follow-up questions 

I would like to ask you. 

MR. SONSINI. Yes. The press is absolutely wrong on that. I never 

took a position that pretexting is legal. Quite frankly once we 

investigated the matter and we got into it, we came out with a report on 

legality. The press took the e-mail to Mr. Perkins and turned it into a 

legal opinion of Mr. Sonsini. That was not it. My e-mail was very clear. 

Mr. Perkins made an inquiry of me. I promptly went to Ms. Baskins, and 

I said give me the information to respond to him. I want to be open to 

him, what was going on. 

I just didn’t receive a flippant answer. I got a written report from 

Mr. Hunsaker. I got a written report from Ms. Baskins. I talked to her 

about it, and I took that information, I conveyed it to Mr. Perkins and 

then I said, based upon what they told me, that it appears--that it appears-

-that this was within legal limits. It was not an opinion. It was 

conveying the truth, what I was told. 

At that point in time, I was not asked to give any legal opinion. That 

came later. At that point in time. 

MS. ESHOO. What about the form 8-K, where there is a reference to 

it? Can you speak to that? 

MR. SONSINI. The form 8-K--that must be the 8-K filed at the end of 

August, and that 8-K, I think, refers now to outside counsel’s view on 

legality. Yes, that came after we conducted the investigation which 

began August 9th, well after the June exchange. 

MS. ESHOO. Let me ask you this. You have been the outside 

counsel for HP for years, and-- 

MR. SONSINI. One of the outside counsel. 

MS. ESHOO. Yes, and I think everyone in the hearing room, if they 

don’t know, should know that you represent a good part of companies in 

Silicon Valley. 
124

When there is a director such as the one that--really I can’t believe 

that he is not here today. This is Dr. Keyworth. How do you advise a 

Board when--let me ask you this. Did the Board ever come to you and 

say, outside of pretexting and investigations, there is a problem with this 

Board. I mean, it really sounds like it is somewhat dysfunctional to me. 

People say the parties scrap, the political parties, but boy you really had a 

whopper there. But, at any rate, a member of the Board of Directors of a 

publicly held company has a fiduciary responsibility--it is a huge 

responsibility, because very average people’s money is placed in 

investment funds that are invested in premium companies: firemen, 

policemen, nurses, teachers, so this is, a very serious thing. 

Were you ever made aware that there was someone there who 

couldn’t keep his mouth shut and that it was damaging, that it was not 

only inappropriate, but proprietary information that goes right to the 

heart of damaging what shareholders hold? 

MR. SONSINI. As a matter of fact, I was aware. I was aware back in 

January of 2005. The Board did come to me. Actually it was the 

Nominating and Governance Committee along with Carly Fiorina that 

came to me and said we believe we have leaks in the boardroom. What 

should we do? 

I said there are three things we have to do. One, I should make an 

inquiry of each director; two, we should remind them of their 

confidential obligations; and three, we should conduct an evaluation of 

the Board. They said, you have the assignment. 

So what I did do, is I talked to each director. I was unsuccessful in 

finding the leak. 

I reminded them of their confidentiality and then-- 

MS. ESHOO. Did you talk to Dr. Keyworth? 

MR. SONSINI. I certainly did. 

MS. ESHOO. And he denied it? 

MR. SONSINI. And he denied it. And then I presented a report of my 

evaluation of the Board--a very candid report of what I thought the 

problem was. You are correct, Congresswoman, that the leak is a 

symptom of a greater problem. 

The way I dealt with it was to deal with it in the boardroom. 

MR. WHITFIELD. Gentlelady’s time is expired. 

MS. ESHOO. Thank you, Mr. Chairman. Are we going to have 

another round? 

MR. WHITFIELD. We are going to have another round. 

The gentleman from Massachusetts is recognized for 10 minutes. 

MR. MARKEY. Thank you, Mr. Chairman. Ms. Dunn, did any of the 

previous investigations by Mr. DeLia for HP involve the use of 
125

pretexting in order to obtain telephone records, Social Security numbers 

or other confidential personal information for the company? 

MS. DUNN. I have no knowledge about any previous investigations 

done by Mr. DeLia. All I knew, and know, is that he had done work, this 

kind of work for the company almost exclusively for 8 or 9 years. 

MR. MARKEY. Do you know, Mr. Adler, if Mr. DeLia had ever used 

pretexting in other investigations? 

MR. ALDER. Congressman Markey, I only can offer hearsay from 

Mr. Nye that he had complained to his manager, Mr. Gentilucci, on 

previous occasions about the practice. 

MR. MARKEY. Mr. Sonsini, do you know if Mr. DeLia had used 

pretexting in other investigations? 

MR. SONSINI. I don’t know. I think our investigation, when we 

interrogated him, there may have been an answer to that. I don’t recall. 

MR. MARKEY. Ms. Dunn, did any of the previous investigations by 

Mr. DeLia or any other person at HP or employed by HP involve spying 

on corporate competitors to HP? In other words, if HP was willing to 

spy on yourselves, did HP engage in corporate espionage of other 

companies? 

MS. DUNN. Congressman Markey, the only investigation that HP 

has ever done with which I have any familiarity are the ones known as 

Kona 1 and Kona 2. 

MR. MARKEY. Mr. Adler, do you know if there was corporate 

spying on other corporations? 

MR. ALDER. I have no such knowledge. 

MR. MARKEY. Mr. Sonsini, do you know? 

MR. SONSINI. No, sir, I don’t. 

MR. MARKEY. Ms. Dunn, in a January 2006 e-mail to Kevin 

Hunsaker, Mr. Gentilucci states, quote, “We use pretext interviews on a 

number of investigations to extract information and/or make covert 

purchases of stolen property, in a sense, all undercover operations.” 

What do you know about this use of pretext interviews by HP which 

Mr. Gentilucci was referring to? 

MS. DUNN. I know nothing about HP’s investigations outside of 

Kona 1 and Kona 2, but I have testified that the methods used in those 

two investigations were standard at HP. 

MR. MARKEY. Ms. Dunn, an amended 8-K was filed last night with 

the Securities and Exchange Commission. Will you please comment on 

the accuracy of that filing? 

MS. DUNN. Congressman Markey, I have asked my attorney, 

Mr. Brosnahan, to communicate directly with Morgan Lewis, a copy of 

which letter was sent this morning. There are inaccuracies in the 8-K. I 

have to point out that I was certainly no longer a part of the company 
126

when that was filed, but it was based on information that could have been 

obtained while I was part of the directors of HP. And I’m afraid that 

because no one ever asked me, and they certainly haven’t looked at my 

sworn testimony, that filing was made with a couple of mistakes. 

MR. MARKEY. Okay. An 8-K filing was made by HP today which 

reports that HP’s Board has, quote, “reviewed and approved certain 

benefits to Ms. Baskins,” HP’s General Counsel, who resigned from HP 

last night and took the Fifth Amendment here today and refused to 

testify. 

Do you think that giving a more than $3.6 million golden parachute 

is an appropriate action by HP at this time? 

MS. DUNN. Congressman, I’d like to point out that I’m no longer on 

the Board of HP. I did not participate in the deliberations-- 

MR. MARKEY. Do you think it’s appropriate for her to receive a $3.6 

million golden parachute last night? 

MS. DUNN. The way these decisions are made are based upon 

deliberation. I would want to hear the other views of the directors if it 

were me still sitting on this Board. She was a 26-year employee of 

Hewlett-Packard, she bled HP blue ink. This woman, I’m sorry to say, 

her career is ruined. She made some errors in judgment; I relied upon 

her, as did many others. I’m not going to comment right now what the 

appropriate compensation to her is to leave HP. 

MR. MARKEY. The results of HP’s leaked investigation were 

presented to HP’s Board at its May 18, 2006, meeting; is that correct? 

MS. DUNN. May 18th? 

MR. MARKEY. May 18th. 

MS. DUNN. Yes. 

MR. MARKEY. You participated in the Board’s discussions of the 

results of the investigation. During that discussion did anyone raise any 

concern about how this investigation had been conducted? 

MS. DUNN. No one did. 

MR. MARKEY. During a meeting a majority of the Board asked 

Mr. Keyworth to resign, which he declined to do; is that right? 

MS. DUNN. That is correct. 

MR. MARKEY. During that same Board meeting Mr. Perkins 

announced his resignation; is that correct? 

MS. DUNN. That is correct. 

MR. MARKEY. Did Mr. Perkins indicate the reason for his 

resignation? 

MS. DUNN. He did. 

MR. MARKEY. Did he indicate that it was related to the leak 

investigation? 
127

MS. DUNN. No. He related that it was due to what he perceived to 

be a betrayal by me, that we had an agreement to cover up the identity of 

the leaker from the Board, which I broke. And I explained to him that 

we never had such an agreement, but that was the reason for his 

resignation. 

MR. MARKEY. So he did not raise at that time any concern about the 

methods used in the investigation? 

MS. DUNN. He did not in the company’s filing of the 8-K. 

MR. MARKEY. No. In the meeting did he? 

MS. DUNN. In the meeting he did not. 

MR. MARKEY. On May 22nd did HP file a Form 8-K with the 

Securities and Exchange Commission which is used to report material 

events or corporate changes? 

MS. DUNN. The company did, sir. 

MR. MARKEY. Who was responsible for that filing? 

MS. DUNN. That’s a statement by management to the SEC; and it’s 

the responsibility of the Legal Department, with the approval of the 

CEO. 

MR. MARKEY. Did you review or approve this filing? 

MS. DUNN. No, I did not, nor did any member of the Board. We 

were provided copies of 8-Ks in the normal course of events after they 

were filed. 

MR. MARKEY. All right. On May 18th Thomas Perkins announced--

the 8-K stated on May 18th Thomas Perkins announced his resignation as 

a director of HP effective immediately. The text of HP’s press release 

related to Mr. Perkins’ resignation is filed with this report as Exhibit 92. 

That press release in turn merely states “HP announced today that 

Thomas J. Perkins resigned from its Board of directors on May 18, 2006 

with immediate effect,” and then goes on to quote Mr. Hurd as thanking 

Mr. Perkins for his service to the company. 

Would you say that this May 22nd, 2006, SEC filing and 

accompanying press release gave a complete picture of the facts and 

circumstances surrounding Mr. Perkins’ departure? 

MS. DUNN. Certainly not with respect to his opinion of me, but Mr. 

Sonsini has much more insight as to how that filing was made than I. 

MR. MARKEY. Mr. Sonsini would? 

MS. DUNN. Yes, sir. 

MR. MARKEY. So before this filing was made, was there any 

consideration given to fully disclosing HP’s leak investigation, its 

findings, the Board request to Mr. Keyworth that he resign, his refusal to 

do so, and Mr. Perkins’ subsequent resignation from the Board? 

MS. DUNN. May I turn to Mr. Sonsini, our counsel? 
128

MR. MARKEY. Yes. Whoever is the appropriate person to ask to 

answer the question. 

MR. SONSINI. Yes, consideration was given to that, Congressman. 

We filed the 8-K report at that time--I did receive a copy and did review 

it--based upon the information we had of why Mr. Perkins was resigning. 

I specifically, before that report was filed, talked to him, and I articulated 

almost verbatim the requirement of the 8-K, was there any disagreement, 

do you have any disagreement with the company or the Board over any 

operation, over any policy, or any practice? He said no. 

MR. MARKEY. So why did HP wait until September 6, 2006, to issue 

a new 8-K filing with the SEC describing the facts surrounding 

Mr. Perkins’ resignation if the Board knew in May what his concerns 

were, and if HP knew even more by July, why did it take until early 

September to issue a more accurate disclosure? 

MR. SONSINI. The 8-K was filed at the end of August. It was not 

filed with respect to the item about director resignation. It was filed to 

provide other information in the market, and it was provided then 

because by then we had completed the investigation that the Board 

requested we do about pretexting. 

Mr. Perkins’ disagreement was not over a company policy practice 

or operation. As a matter of fact, I subsequently confirmed that to him in 

a June e-mail, reminding him of that, and he had no-- 

MR. MARKEY. Well, the September 6 HP filing reports that after the 

May Board meeting and in response to the concerns raised by 

Mr. Perkins, the Board, quote, “engaged the outside counsel to conduct 

an inquiry into the conduct and processes employed with respect to HP’s 

investigation of leaks, and that this outside counsel was not involved in 

the investigation of the leaks initiated by the chairman or the internal HP 

group.” 

Isn’t it true that all of that information could have been made public 

much earlier in the 8-K filing? 

MR. SONSINI. I don’t think so. I mean, it could have been, but it 

really wasn’t material at that point in time because our investigation 

wasn’t completed. I am the outside counsel. So it was a judgment on 

materiality, when to get the information to the market, and that judgment 

was made. 

MR. WHITFIELD. The gentleman’s time is expired. 

We’re going to do a second round here. 

And Ms. Dunn, Mr. Markey raised the issue of the May 18th Board 

meeting at HP headquarters in Palo Alto, California in which you 

informed the Board that George Keyworth was the director that was 

leaking information. And it was told in this article here that you laid out 

the surveillance and pointed out the offending director. 
129

Now, could you describe to the committee what the surveillance data 

was that you laid out that at meeting? 

MS. DUNN. Mr. Chairman, I’m not sure what reports you’re 

referring to; if I may, I assume they’re press reports? 

MR. WHITFIELD. That is correct. 

MS. DUNN. The press reports on this matter have been wrong from 

the beginning. My sworn testimony, as written and submitted, has the 

details of what happened, which I will be very happy to review with you 

quickly. 

MR. WHITFIELD. Okay. 

MS. DUNN. The Chairman of the Audit Committee, Mr. Ryan, based 

on a meeting that I have refreshed my memory took place on April 27th, 

took away the responsibility for reviewing the report and informing the 

Board of its findings. At the May 18th meeting, he was the person that 

outlined a summary of the report’s findings to the Board. 

MR. WHITFIELD. And could you outline a summary of that report for 

us? 

MS. DUNN. There is a set of talking points that I believe have been 

produced that Mr. Ryan gave to the Board, although he presented them 

verbally. 

MR. WHITFIELD. What was the evidence against Mr. Keyworth? 

MS. DUNN. That is contained in Mr. Hunsaker’s report, and it is-- 

MR. WHITFIELD. Could you summarize it for us? 

MS. DUNN. There were 10 unauthorized media disclosures that took 

place over the course of a couple of years, seven of which were 

attributable to Mr. Keyworth and to which he later confessed. 

The Board meeting, if I may continue with its conduct, Mr. Ryan 

presented, without naming the leaker, the evidence. Another director had 

suggested that the identity of the leaker not be disclosed during 

deliberations so that the Board could have an objective discussion about 

what the right move, if any, was. 

MR. WHITFIELD. And who made the decision to disclose it to the 

Board? 

MS. DUNN. Mr. Ryan disclosed the name, I did not disclose the 

name. 

MR. WHITFIELD. So you didn’t have any say-so in the disclosure 

whatsoever? 

MS. DUNN. I had turned the matter over to Mr. Ryan on advice of 

counsel. There was agreement between myself, Mr. Hurd, Mr. Ryan, 

Mr. Sonsini and Ms. Baskins that that was the best way to take-- 

MR. WHITFIELD. And what was Mr. Ryan’s position? 
130

MS. DUNN. His position was that he--I’m sorry. He was the 

Chairman, and remains Chairman of the Audit Committee at 

Hewlett-Packard. 

MR. WHITFIELD. Okay. And from your perspective, did that end the 

investigation? The May 18th Board meeting, was that the end of the 

investigation? 

MS. DUNN. I believe the investigation ended for all intents and 

purposes in mid-March, except for the interview notes that came from a 

discussion between Mr. Ryan and Mr. Keyworth on May 17th. 

MR. WHITFIELD. And from the surveillance and the investigations, 

Mr. Keyworth was the only one identified as leaking Board information? 

MS. DUNN. That is correct. 

MR. WHITFIELD. Okay. And let me just say that I understand 

perfectly well that the news media does not always get everything 

correct. I think all of us have experienced that. But in this article it also 

says, and I think you maybe made reference to this in your testimony, 

that you and Mr. Perkins really did have some personality conflicts or--

would that be accurate? Or were you all the best of friends or did you all 

have personality conflicts? 

MS. DUNN. Mr. Perkins disagreed with many of the governance 

moves that I made on the Board. He always told me that he had nothing 

personal against me, and in fact we had cordial relations--a cordial 

relationship until some time in early 2006, when it became clear that this 

report was moving in the direction of identifying his friend and ally, 

Mr. Keyworth. 

MR. WHITFIELD. Well, the reason I was asking, because in this news 

article--which may or may not be true--it quotes you as saying that all of 

this, this investigation, all of this grew out of a personal dispute between 

you and Mr. Perkins. 

MS. DUNN. I never said that; I have never seen a news story to that 

effect. 

MR. WHITFIELD. So you would disagree with that? 

MS. DUNN. I have never seen that news story, and it would be just 

one among many, many, many that are completely misleading-- 

MR. WHITFIELD. Who is the first Board member that came to you 

and said you know what, we need to investigate these leaks? 

MS. DUNN. I have tried--I’m under oath here. I have tried, believe it 

or not, throughout this to maintain some shred of the sanctity of the 

boardroom. If you force me to say, I will, but I do not think that it is 

relevant to the public interest that I disclose my confidential discussions 

with directors. 

MR. WHITFIELD. Was there more than one Board member that came 

to you? 
131

MS. DUNN. There were seven of nine. 

MR. WHITFIELD. Seven of nine said we need to investigate? 

MS. DUNN. Yes, sir. 

MR. WHITFIELD. Now, reading from this news report again--which 

may or may not be true--it says that--they characterize Mr. Perkins as 

sort of a person who had a broad view of things, as more of a--looked at 

things in a broad perspective, and they talk about you as being sort of a 

nuts and bolts person who crossed the Ts and dotted the Is. And it was 

quoted in here that Mr. Perkins was particularly, in illustrating your 

attention to detail, how you became upset about a discrepancy between 

the corporate Board of Directors handbook and the HP bylaws, and that 

that subject matter took up hours of Board meeting time. 

Now I’m just asking this question. Would you say that is an accurate 

characterization or not? 

MS. DUNN. I’m sure it’s Mr. Perkins’ view. My view was what 

happened was, having been asked to take the job of Nonexecutive 

Chairman to bring HP’s governance practices up to best practice, there 

were a lot of things that needed to be addressed in the foundations of the 

Board’s governance. It was in the province of the Nominating and 

Governance Committee to address those. I asked Mr. Perkins to serve as 

chairman of that committee, and it was in that committee that his 

impatience with dealing with those matters showed itself most clearly. 

He felt that that committee should be talking about strategy. I felt that 

the Board should be talking about strategy, not the Nominating and 

Governance Committee. 

MR. WHITFIELD. Who gave to the agencies that did the pretexting 

the names of the people that you wanted surveillance on or you wanted 

the phone records on? Who gave the list to the-- 

MS. DUNN. They came up with their own list. I continue to be 

surprised by revelations of who was on it. 

MR. WHITFIELD. So they came back--did they come back--to you 

and gave you the list and said, what do you think about this? Or did you 

just wash your hands of it and say-- 

MS. DUNN. Well, they asked me for--I had to provide them input, 

context, I was the person who had the problem on behalf of the Board 

that had asked me to do something about this. So in any investigation, 

whoever it is that has got the problem has to explain the problem to the 

investigators. 

MR. WHITFIELD. Did you give them any names? 

MS. DUNN. No. I wanted them--that was part of having a 

professional investigative team--to be able to do whatever they do. And 

as I mentioned, ultimately they concluded I was one of the suspects. 
132

MR. WHITFIELD. And you said that they used the standards of HP, 

and yet this was a particularly unusual event because I’m quite confident 

that there has never been a surveillance or investigation of the entire 

Board before. 

MS. DUNN. I’m sure you’re right. And I believe that the 

surveillance was limited to their efforts to find out more evidence about 

whether Mr. Keyworth was in fact talking to a reporter after they had 

come to the strong thesis that he was the person responsible. 

MR. WHITFIELD. And you have had an opportunity, I guess--have 

you had an opportunity to see the list of everyone that they investigated? 

MS. DUNN. No, I have not seen that list. 

MR. WHITFIELD. So you do not know who was investigated then? 

MS. DUNN. I know some by--well, if the press reports are correct, I 

know some. 

MR. WHITFIELD. Was Mrs. Fiorina investigated from your personal-

- 

MS. DUNN. Yeah, that one I read about recently. 

MR. WHITFIELD. Okay. Now, did you receive a severance package 

at the termination of your tenure on the Board or when you resigned? 

MS. DUNN. I was never an employee of Hewlett-Packard. I have not 

had one nickel of cash flow from Hewlett-Packard in 6 years, except for 

committee fees. So I’m kind of out of pocket for dealing with HP right 

now. 

MR. WHITFIELD. Let me ask one other question, and my time is 

expired. Were you the Chairman of the search committee that brought 

Mr. Hurd to HP? 

MS. DUNN. I was the Nonexecutive Chairman of the Board. Our 

whole Board was the search committee, but I did lead the search 

administratively. 

MR. WHITFIELD. Okay. Thank you. 

I recognize Ms. DeGette. 

MS. DEGETTE. Thank you, Mr. Chairman. 

Mr. Adler, you told Ms. Eshoo that pretexting is--you told me that 

the embedded technology, the tracers is a standard technique used by 

Hewlett-Packard, correct? 

MR. ALDER. You also used the word “pretexting” when you started. 

Could you clarify that? 

MS. DEGETTE. You said the embedded technology, the tracers is 

standard practice, right? 

MR. ALDER. Yes. 

MS. DEGETTE. What about pretexting? I think you told Ms. Eshoo 

that pretexting is also a standard practice. 

MR. ALDER. Within HP? 
133

MS. DEGETTE. Yes. 

MR. ALDER. I have no further knowledge of pretexting, direct 

knowledge. All I can offer you is what I offered Congressman Markey, 

and that was there was a complaint by Mr. Nye that it had been utilized 

prior. 

MS. DEGETTE. You had never personally seen pretexting prior to 

this situation? 

MR. ALDER. I’m sorry. Could you repeat that? 

MS. DEGETTE. You had never seen pretexting prior to that 

situation? 

MR. ALDER. No, I had not. 

MS. DEGETTE. Had you heard of it? 

MR. ALDER. No, I had not even heard of it. 

MS. DEGETTE. Okay. Mr. Sonsini, as outside counsel to the 

corporation, what is your view of the use of tracer technology to track 

messages? Do you think that’s an appropriate--I’m not asking for a legal 

opinion. Do you think that’s an appropriate technique in these 

situations? 

MR. SONSINI. Given what I’ve learned, I think any technique that 

invades privacy is not appropriate. 

MS. DEGETTE. Including tracer technology? 

MR. SONSINI. Including tracer technology. 

MS. DEGETTE. Were you aware tracer technology was at least 

attempted to be used in this situation of the Board investigation? 

MR. SONSINI. I was not aware of any methodology that was being 

used in this investigation. 

MS. DEGETTE. Now, it seemed to me when I looked at some of the 

voluminous documents here, after Mr. Perkins made his allegations and 

you were asked to look into that, the allegations you were asked to look 

into were the specific allegations that Mr. Perkins made, correct? 

MR. SONSINI. Correct. 

MS. DEGETTE. Did anybody ever tell you that these investigators 

were using the tracer technology to try to trace messages? 

MR. SONSINI. No. 

MS. DEGETTE. Did anybody ever tell you that they were coming up 

with a fake individual to try to have communications with newspaper 

reporters? 

MR. SONSINI. No, none of that. I assume you’re talking about prior 

to our investigation of this investigation? 

MS. DEGETTE. That is correct. 

MR. SONSINI. No. 
134

MS. DEGETTE. Did anybody ever tell you that they were going 

through the trash of the Board members or tracking their family 

members? 

MR. SONSINI. No. 

MS. DEGETTE. And what advice would you have given if somebody 

had said this is what we’re going to do to try to find the leaks from the 

HP Board? 

MR. SONSINI. It would be totally improper. 

MS. DEGETTE. Why would that be? 

MR. SONSINI. Because I think it implicates in many respects the 

invasion of privacy. And although I’m not an expert on legality, it 

certainly doesn’t seem to meet the standards of ethics and integrity that 

we ought to have at the corporate level. 

MS. DEGETTE. Right. We’re all focused here on whether or not the 

pretexting is illegal, but in truth the rest of these techniques are just kind 

of sleazy and I would say not appropriate in a corporate context; would 

you agree with that? 

MR. SONSINI. I absolutely agree. I think in today’s world, 

particularly after what Congress has done with Sarbanes-Oxley, we have 

emphasized that tone at the top is very critical in the role of corporate 

governance, and that means ethics, that means veracity and that means 

integrity, and those types of tactics don’t have any place. 

MS. DEGETTE. Mr. Sonsini, I think you also would agree with me 

that the tone at the top that you refer to should also refer to corporate 

boards and officers and not just employees of the corporation, right? 

MR. SONSINI. It should begin with the boards. 

MS. DEGETTE. Exactly. This is what I’ve been saying for 5 years 

ever since we started these investigations. 

Ms. Dunn, I just want to turn to just a couple more issues about this 

fake person that you folks were coming up with to try to get information 

out of reporters. And I’d like you to take a look at Tab 60, if you will, in 

your notebook. It’s an e-mail dated--or some kind of memo dated 

February 22, 2006, from Mark Hurd--from Kevin Hunsaker to Mark 

Hurd, with a copy to you. Now have you seen this top e-mail? 

MS. DUNN. I am seeing it now. 

MS. DEGETTE. Okay. And underneath it there is an original 

message from you, Pattie, to these various people. Do you see that? 

MS. DUNN. Yes, I do. 

MS. DEGETTE. Do you recall sending that e-mail? 

MS. DUNN. I must have sent it. 

MS. DEGETTE. And that’s in response to an e-mail from Kevin 

Hunsaker to you and to Ann Baskins. And what that original e-mail says 

is they’re going to propose sending this e-mail to the reporter, with the 
135

hope that she would forward it to your target, the person who you 

thought was the leaker, and then what would happen? And the person--

and Kevin says “I made up everything in the side, trying to make 

it...feasible.” So was it your understanding this was the fake individual, 

Jacob, who was going to send this out to the reporter? Was that your 

understanding? 

MS. DUNN. That is my understanding. 

MS. DEGETTE. And then you said in response to that, “Kevin, I 

think this is very clever. As a matter of course, anything that is going to 

potentially be seen outside HP should have Mark’s approval as well.” Is 

that right? That’s what you said to Kevin? 

MS. DUNN. Yes. And what I testified earlier to is I regret the use of 

the word “clever” because it-- 

MS. DEGETTE. Right, I’m sure-- 

MS. DUNN. Because it does not convey what I was-- 

MS. DEGETTE. Right. And I’m not--I’m not trying to excoriate you 

for saying the word “clever,” but my point is, you knew that this--you 

had said before, you just said go do the investigation and then they did it, 

you didn’t know; but, in fact, you knew as it was going along that Kevin 

Hunsaker was doing this Jacob to try to get a reporter to respond, right? 

So you knew that was going on, right? 

MS. DUNN. I did not see myself, nor-- 

MS. DEGETTE. I’m just asking yes or no, did you know that was 

going on? 

MS. DUNN. I knew, and I did not see myself as the person who was 

appropriate to approve investigative methods. 

MS. DEGETTE. Right. And this is what I’m saying. And Mr. 

Chairman, I guess I’ll just say this, concluding this panel. At first I did 

not think this HP issue really rose to the level of the corporate 

responsibility issues that we looked at several years ago, but I’m 

becoming less convinced of that because this is exactly what we saw 

when we brought the executives from some of the other companies in. 

Of course these were situations of fraud where people have gone to jail. 

That’s not what we’re talking about here. But it could happen with 

another corporation. If boards don’t start to realize that this is a very 

serious problem, that you can’t just say to somebody, well, I’m only a 

board member or I’m not a compensated employee, and so I can put 

something into--I can put something into process. I can be the general 

counsel, I can be on the investigative team, but I’m not responsible for 

things that happen because it’s not in my chain of command. We can’t 

have that anymore. There is a fiduciary duty that every board member of 

every corporation has to that corporation. 
136

And Ms. Dunn and Mr. Sonsini, you’re both nodding, I think you 

would both agree with me. And that’s why we really need to look and 

see if there is any broader public policy implications to this. Because 

Ms. Dunn, you knew a lot of techniques were going on, you just didn’t 

think it was your job to do anything about it. Mr. Sonsini, you were 

outside counsel, and no one bothered to tell you about a lot of this. 

I think it is very disturbing, and I think it is a good case study. 

Anyway, that is all I would have to say, Mr. Chairman. 

MR. WHITFIELD. Thank you, Ms. DeGette. 

I recognize Mr. Walden for 10 minutes. 

MR. WALDEN. Thank you very much, Mr. Chairman, I appreciate 

the opportunity for another round of questions. 

Ms. Dunn, I remain concerned obviously about what I’ve heard 

today based on what also is contained in some of these reports. I would 

refer you again to Tab 119 in that huge book you were just about to slide 

past you. And in it, item number 14, it says--this is again from Tony 

Gentilucci, it stated, DeLia told him sometime during the week of July 

4th that pretexting was fully discussed with Dunn and Baskins in Kona 1. 

Do you dispute that that occurred? 

MS. DUNN. I’m just going to have to go back to my earlier 

statement, sir. I had no understanding or knowledge of the fraudulent 

representation of identity as a standard investigative tactic at 

Hewlett-Packard. The word “pretext” and pretexting means a lot to us 

now, it meant nothing to me in June 2005. 

MR. WALDEN. On August 21st, a report from Kevin Hunsaker, 

number 118, it’s the interview of Mr. Hunsaker, who unfortunately took 

the Fifth and has left the company. Number 42 says, “One month into 

the investigation the issue of pretexting came up again, and Dunn and 

Baskins asked him to confirm the legality of the investigative method 

during a Friday phone call before the March Board meeting in Los 

Angeles. Dunn and Baskins wanted him to confirm the method’s legality 

in case Hurd had any concerns during the presentation in Los Angeles.” 

MS. DUNN. Well, I think this is very close to true. I did ask for 

confirmation that the use of phone records in these investigations was 

permissible. 

MR. WALDEN. So the issue of--but it says here the issue of 

pretexting came up. 

MS. DUNN. Well, I think the word now has entered our lexicon as a 

substitute for the word “phone records.” 

MR. WALDEN. But why would you ask about the legality of it then? 

MS. DUNN. That’s what a Board member does, you look for 

representations-- 
137

MR. WALDEN. So they never described the process to you that they 

were using? I mean, he says they did. The issue of pretexting came up, 

they talk about investigative method. 

MS. DUNN. No one ever described to me that the fraudulent use of 

identity was the HP way of conducting internal investigations. 

MR. WALDEN. Right. DeLia, though, I’m told, mentioned 

impersonation during the June meeting, did that trouble you? 

MS. DUNN. If I heard the word “impersonation,” it probably would. 

I don’t recall it. 

MR. WALDEN. How did you think they were getting these phone 

records? 

MS. DUNN. My understanding was that these records were publicly 

available. 

MR. WALDEN. But I thought I read somewhere here--oh, that’s right. 

Number 116, page five. And it says, “Dunn said that DeLia told her such 

information was basically publicly available,” right, do you remember 

that? 

MS. DUNN. That’s my testimony here today, yes. 

MR. WALDEN. That DeLia told you that “such information was 

basically publicly available,” that is in quotes. Then it goes on down, 

number 30 says, “Dunn was not aware that one method for retrieving 

records entails the callers pretending they’re someone else. Dunn 

thought that the investigators were able to get the information just 

because of the administrative sloppiness of the phone carriers.” What 

did you mean by that? 

MS. DUNN. What I meant was that I understood that you could call 

up and get phone records, that it was a common investigative technique. 

MR. WALDEN. So you think I can call up and say anybody in the 

public can get your phone records? 

MS. DUNN. I thought a year ago, I thought 6 months ago that indeed 

you could. 

MR. WALDEN. You really believed this? Really? I’m sorry here, 

but you believe that I could call whoever your carrier is and say, I’m 

Congressman Greg Walden, I’d like Mrs. Dunn’s phone records, cell, 

home, office-- 

MS. DUNN. It really wouldn’t surprise me. 

MR. WALDEN. You’re serious? I’m not being funny here, I mean 

this. You honestly believed that it was that simple that your phone 

records, anybody in the world can just call up and get them? I mean, is 

that how you describe publicly available? 

MS. DUNN. We have to make a distinction between my knowledge 

now and my knowledge during this investigation. 

MR. WALDEN. That’s what I’m trying to get. 
138

MS. DUNN. During this investigation it was my understanding that 

these records were available through permitted mechanisms, and that it 

was the common practice within Hewlett-Packard to use phone records 

to perform investigations. 

MR. WALDEN. But you said you thought they were publicly 

available, which means going to the Internet, putting in somebody’s 

name and up pops my phone record. 

MS. DUNN. That would be one idea. 

MR. WALDEN. What would be others? 

MS. DUNN. I don’t know, I didn’t give it thought. 

MR. WALDEN. Then you go on to say through administrative 

sloppiness. That, to me, would say somebody is making a mistake at Ma 

Bell. 

MS. DUNN. That’s a transcription. I don’t recall using those words. 

MR. WALDEN. Mr. Sonsini, do you have any reason to doubt the 

summary of this? 

MR. SONSINI. No, I don’t. 

MR. WALDEN. Do you have a transcript? 

MR. SONSINI. I have no reason to doubt the transcript. 

MS. DUNN. This is not a transcript like this woman is recording our 

comments. It is an interpretation of what I said. 

MR. WALDEN. You’re right. So tell me what you meant--did you 

use the term “administrative sloppiness”? 

MS. DUNN. I don’t think so. If I did, I don’t understand the way that 

it’s appearing here, administrative sloppiness. My understanding was 

that these--sir, my understanding was that these records were available 

generally to investigations such as the ones that were being conducted at 

Hewlett-Packard. 

MR. WALDEN. Do you have any problem with us getting the 

transcript so we know exactly-- 

MS. DUNN. If one was produced. 

MR. WALDEN. Mr. Sonsini, was one produced? 

MR. SONSINI. I would have to ask my team, Congressman. 

MR. WALDEN. Were these interviews recorded? 

MR. SONSINI. Yes. These were just the interview reports, they were 

not recorded. There is no recording of the conversation other than the 

notes of those who made the inquiry. 

MR. WALDEN. But you believe these notes to be accurate? 

MR. SONSINI. I do. 

MR. WALDEN. And Ms. Dunn believes they’re not. 

MS. DUNN. This is the first time that these notes have been produced 

for me, so I haven’t had a chance to go through those notes. 

MR. WALDEN. But you read the part-- 
139

MS. DUNN. No one has given me an opportunity to review, either 

now or previously, what I said. My understanding is, for example, that if 

you give a deposition under oath, you get a chance to review those 

deposition notes to make sure that is your sworn testimony. 

MR. WALDEN. Well, this is all I have to work off of. And there are 

lots of issues here where lots of people have reported in the course of the 

investigation that Mr. Sonsini’s firm did, that they believe you were told 

about pretexting, and that the methods were described. 

MS. DUNN. I understand the problem. I understand the chain of 

communication and why it is confusing. 

MR. WALDEN. The part of the chain of communication that I’m 

confused about is, you sat as an outside director, charged by a Board of 

seven without an official Board position, as I understand it was seven 

Board members, basically said please go do this, you didn’t vote on it as 

a Board, right? 

MS. DUNN. We did not. In fact, it was not a matter that could be 

brought to our full Board. 

MR. WALDEN. And you told me you don’t have a staff. 

MS. DUNN. No. 

MR. WALDEN. You interact with the investigative folks, you name 

the investigation, you provide phone numbers for investigators for 

certain people you would like them to look at, you’re in interactions with 

your legal team and the investigators from time to time, you get briefed 

on draft findings of the investigative report, but you don’t sign off on any 

of this yourself, you defer to senior management, correct? 

MS. DUNN. With the addition that I did not hire these investigators-- 

MR. WALDEN. I understand, I’m trying to get to a different point, 

and that is who in senior management then is responsible for this 

investigation since you’re not? 

MS. DUNN. Well, the last investigation was clearly under the 

auspices of Mr. Hunsaker. 

MR. WALDEN. Well, he’s your counsel. I thought I read here where 

more like Mr. Hurd had to sign off on things, is that not the case? 

MS. DUNN. Well, Mr. Hunsaker’s title, by the time this investigation 

was partway through, and before, is--his title was Director of Standards 

of Business Conduct and Ethics Compliance-- 

MR. WALDEN. So he was the final decision maker on this? 

MS. DUNN. No. 

MR. WALDEN. Who was the final decision maker? 

MS. DUNN. I would have said Ann Baskins. 

MR. WALDEN. So nobody else on the Board, not Mr. Hurd--so she 

could overrule every other decision; is that what you’re telling me? 
140

MS. DUNN. She was responsible for the oversight of the person 

carrying out the investigation. 

MR. WALDEN. So she reported to nobody? 

MS. DUNN. Well, she reported administratively to Mark Hurd in ‘06 

and to Bob Wayman in ‘05. 

MR. WALDEN. Because at some point the buck stops somewhere. 

MS. DUNN. I’m trying to be responsive to your question about her 

reporting relationship. 

MR. WALDEN. That’s what I was asking. I appreciate that. My time 

is expired. 

MR. WHITFIELD. Thank you very much. 

Ms. Schakowsky, you are recognized for 10 minutes. 

MS. SCHAKOWSKY. Thank you, Mr. Chairman. I’m actually going 

to have to leave in 5, so-- 

Mr. Sonsini, I wanted to ask you some questions. And maybe we’re 

going over some other turf that’s already been gone over, and I hope you 

will bear with me, I want to explore it a little bit further. 

I’m looking now at this Tab 91 in the big book, and this is the 

communications, the e-mails that you have in June, the last one being 

your June 28th e-mail to Tom Perkins regarding your--he had asked you, 

it was very wordy, he was asking you, you should check into the sub rosa 

investigation of director’s communication at HP in the view of Viet 

Dinh, I guess that lawyer’s--unqualified opinion that it was illegal, I 

think the Board needs to know the potential risks. 

And then you respond that, quote, “The process was well done and 

within legal limits,” unquote. And you continue that the phone records 

were obtained by the pretexting, and that it is, quote, “a common 

investigatory method which was confirmed with experts.” The legal 

team also checked with outside counsel as to the legality of this 

methodology. So I’m wondering who the experts were whom you 

consulted? 

MR. SONSINI. As the e-mail indicates, I went directly to the HP 

Legal Department. I went to Ms. Baskins, and she went to Mr. 

Hunsaker. I requested that they give me a response to these concerns and 

Mr. Perkins’. 

Please understand that I was not conducting any investigation at that 

time, was not asked to and was not rendering any legal opinion. But I 

believe that he needed to have a response. I asked for a detailed 

response. I got two written responses plus oral assurances, and I reported 

it to Mr. Perkins. Based on those responses only, without any 

independent judgment, I made the statements that I made here. 

MS. SCHAKOWSKY. So your legal team or--an outside counsel didn’t 

check to determine whether pretexting was legal? 
141

MR. SONSINI. Not at that time, not at that time at all. When we got 

the report, we were asked to focus, as Ms. Dunn has testified, on what do 

we do with the results? We have a crisis. The Board was looking to me, 

we need corporate governance here, what are we going to do with this. 

And I laid out a plan that we had to have full disclosure to the Board, this 

be vetted out, et cetera. 

It was afterwards that the Board, through the Nominating and 

Governance Committee, came to me and said we need you to look into 

the legality of this, and it was then that my team conducted the 

investigation and came to the findings that we came to. 

MS. SCHAKOWSKY. So you didn’t check, but you conveyed to 

Mr. Perkins essentially that you had-- 

MR. SONSINI. No, I was-- 

MS. SCHAKOWSKY. The investigation-- 

MR. SONSINI. With all due respect, my e-mail was very careful. I 

told them this is where I went and this is what I learned. Mr. Perkins was 

not a director at the time. The question is whether Mr. Perkins had any 

standing to even request me to do anything. But because I believed it 

was important to get this fully reported and because I believed that he 

was entitled to know what legal counsel would say because he was a 

director at the time, I asked him, what do you want me to say, give me a 

thorough response. I got it and I conveyed it. 

MS. SCHAKOWSKY. Well, I mean, he was clearly very worried at 

that time about the sub rosa investigation, and so you’re saying the team 

did not check the Federal Trade Commission. 

MR. SONSINI. I don’t know what the team did, other than what they 

gave me. I was not involved in this investigation. When they said that 

they conducted this legally, when they issued a report that I received in 

April, well after the investigation was done, that it was done in lawful 

limits, you know, they were relying on their own experts. They said that 

they reviewed it, they said they researched it. You know, the HP Legal 

Department is a big department, it has over a hundred lawyers; I’ve 

worked with them for years. Not all matters are farmed out to outside 

counsel. And when they are farmed out, they are not all farmed out to 

Wilson Sonsini, they have multiple lawyers. 

I was given a specific task, and it was a crisis. There was a crisis in 

this Boardroom because, as I said, I believe a leak is a symptom of a 

bigger problem, and that’s what I focused on. 

And I want to make that very clear that the press has it all wrong, 

that I was passing upon legality at that time. I passed upon it when I was 

required to do it, and I passed upon it thoroughly and strongly and made 

very difficult findings that were conveyed to the Board. 
142

MS. SCHAKOWSKY. So then you don’t stand behind the fact that 

appears--well, except the fact that you say it appears--that you say that 

the process was all “well done and within legal limits, the concerns 

raised in your e-mail did not occur.” That’s a declarative sentence. 

MR. SONSINI. At that time, as I repeated, I was passing on 

information; I demanded that the information be thorough. And it is 

correct, “it appears.” I was very careful with this e-mail. “Mr. Perkins, 

this is where I went, this is what I was told on the basis of that, it 

appears.” I was not saying it was legal at that time. I did not understand 

the methodologies that were involved. There was a lot more that we 

needed to find out and we did find out, and that’s when we started 

passing on legality. 

Mr. Perkins took my e-mail, he thanked me for it, it gave him the 

information he wanted, and we were on our way. 

MS. SCHAKOWSKY. Well, the information that he got was 

reassurances, quote, “the concerns raised in your e-mail did not occur.” I 

would have felt--I would have liked it, too, and thanked you for that. 

MR. SONSINI. I don’t think Mr. Perkins was asking me for 

reassurances. Mr. Perkins had counsel at the time, Mr. Dinh, he had the 

opinion of Mr. Dinh’s concern about legality; that’s what he told me, and 

I was giving him the information. 

MS. SCHAKOWSKY. Thank you. 

MR. WALDEN. Ms. Schakowsky, would it be possible for you to 

yield to me for a question? 

MS. SCHAKOWSKY. I would be happy to. 

MR. WALDEN. Ms. Dunn, I have one more question for you on this 

topic. It’s Tab 66. And this is an e-mail from Kevin Hunsaker to Vince 

Nye, Mr. Adler, Mr. Gentilucci, Mr. Anthony, Mr. DeLia. It says, “I just 

got off the phone with Pattie. She would like to put a comprehensive 

summary of what we’ve done, what resources and techniques we’ve 

used, et cetera. It should include everything we’ve done on the EC folks, 

the Board members and other employees. It should also include things 

like our, and in parens, unsuccessful attempts to obtain the EC members’ 

cell phone members,” et cetera. It’s dated February 24, 2006. 

Did you indeed have a conversation with Mr. Hunsaker on the phone 

on that date where you ask about resources and techniques? 

MS. DUNN. I have no reason to think that he would write this e-mail 

without our having had that conversation. I do not remember this 

specific conversation. It’s quite logical it took place. I believe what was 

going on here was that we were preparing for the issuance of the report 

that he--final draft or early draft of the report that came out on May 10th--

sorry, March 10th, and I wanted to convey to him--I’m not sure I 

conveyed all the details that he says I conveyed. He may have been 
143

using the fact of a conversation with me, as sometimes happens in big 

companies, to put his own momentum behind something that-- 

MR. WALDEN. Oh, so you think this isn’t what you said? 

MS. DUNN. I don’t know that I said all of these things, but it would 

be very logical that I would have said “Kevin, when that report is 

written, it needs to be complete, it needs to have everything in it that 

you’ve done.” 

MR. WALDEN. I guess I’m questioning, if you weren’t in charge of 

the investigation and you only focused on the last couple of pages, why 

were you giving him that much direction? 

MS. DUNN. Because I had the responsibility and was thinking ahead 

about what our Board was going to receive as a basis for making a very 

important, very sensitive decision about a fellow director-- 

MR. WALDEN. But this is really pretty specific about resources and 

techniques, it doesn’t really get much beyond that. 

MS. DUNN. That’s his interpretation of our conversation. 

MR. WALDEN. Okay, thank you. 

Every one of these e-mails we have, Mr. Chairman, seems to have a 

different interpretation, depending upon who is reading it. Thank you. 

MR. WHITFIELD. The gentlelady from Tennessee is recognized for 

10 minutes. 

MRS. BLACKBURN. Thank you, Mr. Chairman. And thank you to all 

of you for your patience. 

Mr. Adler, I had a couple of questions for you. In going back to your 

testimony--which with all of my papers now I have misplaced. But you 

talked--I think it was on page 2 of your testimony where you talk about 

the standards, and having standards that apply. And you mention in your 

testimony several different times standards, legal standards, and then my 

assumption is HP standards that would be applicable to a corporate 

investigation. Would I be right in that assumption, sir? 

MR. ALDER. No. The standards I referred to were the HP Standards 

of Business Conduct, which would be applicable to all employees. And 

also, as you said, the legal standards, which are all, again, applicable to 

everyone. 

MRS. BLACKBURN. Okay. And is that a criteria, a set criteria that 

exists in writing, or was that just something that in your department with 

Mr. O’Neil as your supervisor you all had devised kind of a best 

operating practices? 

MR. ALDER. HP practices of conduct are in writing. Every year 

employees are required to review those standards and are given training 

in them. 

MRS. BLACKBURN. So these were standards that were widely 

known? 
144

MR. ALDER. I’m sorry, one more time? 

MRS. BLACKBURN. They were widely known? 

MR. ALDER. The standards of business conduct were widely known, 

yes. 

MRS. BLACKBURN. Another question. In reference to using the 

Spyware, as we call it, the tracer, you mentioned that attorneys had 

reviewed the information. Which attorneys reviewed that for you? 

MR. ALDER. I think we’re getting this confused perhaps slightly. 

Attorneys review with regard to--I know I did say that, with regard to the 

pretexting? 

MRS. BLACKBURN. Yes, sir. 

MR. ALDER. That was in my statement. I was making reference to 

the pretexting issue, that we were told that at least the attorneys had 

reviewed the pretexting. 

MRS. BLACKBURN. But it did not apply to the investigation as a 

whole? 

MR. ALDER. Well, Kevin Hunsaker, our chief of ethics, is an 

attorney, and we worked at his direction, and he was our counsel. And 

so everything was reviewed by him for legal compliance. 

MRS. BLACKBURN. Okay. All right. Thank you. 

MR. ALDER. You’re welcome. 

MRS. BLACKBURN. Ms. Hurd, I want to stay with this tracer. 

MS. DUNN. I think the real Mrs. Hurd would be surprised by that. 

MRS. BLACKBURN. Ms. Dunn, and the relationship between you and 

Mr. Hurd. And I’ll tell you where I’m going with this. I’m going to read 

from your testimony again that you supplied to us yesterday, and I’m on 

page 20 in the first paragraph, where you say “neither Mr. Hurd nor I 

designed or implemented the investigative techniques; however, we both 

were made aware of the sting operation that the investigators proposed in 

early February for the purpose of determining whether the CNET 

reporter whom Mr. Keyworth was suspected of talking, and by then the 

investigative team had narrowed its hypothesis about the identity of the 

leaker to him, was in contact with Mr. Keyworth. I was contacted by Mr. 

Hunsaker, with Ms. Baskins in the loop on the communication about this. 

Having asked for and received all immediate assurances that this was a 

legal and common investigative technique, I referred them to Mr. Hurd 

for the final decision.” 

Now, did he indeed make the final decision about moving forward 

with all forms of the investigation? 

MS. DUNN. With all forms of the investigation? No. I don’t think 

that is true. I think that the methods were delegated to Mr. Hunsaker, 

with oversight from Ms. Baskins. 
145

MRS. BLACKBURN. So he made the final decision on the sting 

operation? 

MS. DUNN. I believe he needed to be aware of it. I don’t know the 

way in which he communicated his views back to the investigative team. 

MRS. BLACKBURN. I just have such a difficult time trying to figure 

out who--where did the buck stop? In HP, where did the buck stop with 

making the decision to conduct the sting? Where did the buck stop with 

making the decision to use a tracer technology? Because Mr. Hurd is 

going to come and tell us on page 7 of his testimony that they--let’s see, 

“In February 2006 I was informed by the investigation team that they 

intended to send an e-mail to a reporter containing false information in 

an effort to identify the source of the leaks. I was asked and did approve 

the content of the e-mail. I do not recall seeing, nor do I recall 

approving, the use of tracer technology.” 

Well, we’ve got two different things going here. One is the 

Spyware, if you will, and that is attached to the e-mail, and another is the 

content, the text that is in the e-mail. And it is of tremendous concern 

that we don’t seem to have anybody that wants to say yes, indeed, I was 

in charge, I was expected to be in charge, and I made the decisions 

accordingly. So I’m trying to get to that-- 

MS. DUNN. Well, I think some of those people have just declined to 

testify, and that’s frustrating for us all. 

MRS. BLACKBURN. Okay, let’s go to Exhibit 52. 

MS. DUNN. Would that be Tab 52? 

MRS. BLACKBURN. Yes, ma’am. 

MS. DUNN. I’m there. 

MRS. BLACKBURN. Okay, great. Okay. This is an e-mail from you, 

starting with the original message. “I spoke with Mark. He is on board 

with the plan to use the info on new hand-held leader. He also agrees 

that we should consider doing something with the adaptive enterprise 

branding issue, given there is some chance D.K. will seek clarification on 

this from her CNET source.” And then his response, the response 

coming back to you, “Understood, thanks. We will put this in motion in 

the next few hours.” 

So this e-mail seems to indicate that Mr. Hurd was not only aware of 

the operation, but he was making suggestions to you or somebody as 

how to implement it. Is that accurate? 

MS. DUNN. That doesn’t feel like what happened to me. 

MRS. BLACKBURN. Well, what-- 

MS. DUNN. What happened was that this team was devising methods 

to finalize the investigation to be very confident that they have identified 

the correct person after nearly 2 years of problematic leaks, and that they 

were enthusiastically sharing their ideas with the most senior people that 
146

they could find. And I don’t know how Mark responded per se. I would 

respectfully say that that’s a question for him to answer because it would 

be hearsay on my part. 

MRS. BLACKBURN. Okay. All right. Thank you. 

Mr. Chairman, I yield back. 

MR. WHITFIELD. Thank you very much. 

At this time I recognize Mr. Inslee for 10 minutes. 

MR. INSLEE. Thank you. 

Mr. Adler, I wanted to ask you about the tracer technology, and I 

want to make sure that I understand how it worked. As I understand, HP 

would essentially send an e-mail with an attachment, with this attached 

to Mr. Smith, and when Mr. Smith sent an e-mail to Mr. Jones, somehow 

that would report back to HP indicating that Smith had sent Jones this 

document; is that how it works? 

MR. ALDER. No, sir. 

MR. INSLEE. Okay. Tell me how it works then. 

MR. ALDER. It’s dependent upon--well, the document itself, not the 

e-mail, the document is within the e-mail, the document itself must be 

opened. 

MR. INSLEE. Correct. 

MR. ALDER. Is that what you said? 

MR. INSLEE. Well, you corrected me, I’m sorry. You were accurate, 

I misstated. It is the documents--the delivery of the document that is 

reported back to HP. Thank you for correcting me. 

MR. ALDER. It does not report back to HP. It reports back to the 

company that provides the service, readnotify.com, and it’s through the 

auspice of your personal account. You may then open the account and 

see if a return receipt has been provided for that particular document. 

MR. INSLEE. And when does that information come back? Is it 

essentially contemporaneous with Jones, the recipient of the second 

e-mail, opening the document? Does it happen right away? 

MR. ALDER. Any time the document is open, there is a report that is 

generated. 

MR. INSLEE. So you attempted to distinguish this from a trap and 

trace system or an eavesdropping system or a tap by saying it’s not 

contemporaneous; it pretty much is contemporaneous, isn’t it? 

MR. ALDER. No, not really. 

MR. INSLEE. I mean, because as soon as Smith gets it and opens up 

the attachment, boom, that goes immediately back to this company; is 

that right? 

MR. ALDER. But Smith had already received this attachment, and 

therein I believe lies the difference. 
147

MR. INSLEE. I just want to make sure I understood this. When 

Smith sends an e-mail to Jones, as soon as Jones opens that attachment, 

immediately that information goes back to the reporting agency; is that 

right? 

MR. ALDER. That is my understanding, as soon as the document is 

open. 

MR. INSLEE. Now, is it my understanding that HP’s corporate policy 

is that that is an acceptable corporate strategy to use trace technology like 

this when HP decides to use it? Is that HP’s decision now, or was it 

during the scope of this investigation? 

MR. ALDER. That was and still is current policy. 

MR. INSLEE. So let’s say that you have a customer of HP, you do 

business with them, you sell their products, they are your trusted, 

treasured customer to whom you expect to have a relationship of great 

integrity. You believe, and it is currently HP’s policy, as I understand it, 

that you can send an e-mail to them with this tracing system. Let’s say 

you sent it to ACME Electronics, your good customer, and when ACME 

Electronics then sends an e-mail to Smith, let’s say their attorneys, they 

send an e-mail to their attorney or to their priest or to their doctor, and 

what they may consider to be a confidential communication, free from 

the prying eyes of HP, as soon as their priest or their doctor or their 

accountant or their neighbor or friend opens that attachment, HP will 

then get back a report immediately that this e-mail has been sent to that 

location, even though your customer has never been informed you’re 

going to do that. Is that pretty much HP’s operating procedure? 

MR. ALDER. No. Number one, we don’t send this type of--we don’t 

use this type of technology with our customers. Number two, in the 

sense that there is no information from the recipient that is derived, other 

than the IP address; that is, the Internet Protocol address, that is all we 

get. That address may only tell us that it is in the United States, that it is 

in the world or in a specific region. As in the case of what we attempted 

to do is we’ve suspected it would be Mr. Keyworth that would be the 

recipient. The best that we would have found out from his IP address 

reporting back to this “read notify” was that it would have been in the 

Oakland area or in northern California for an AOL customer. That is 

what it would have discerned. 

MR. INSLEE. Let me make sure I understand. You used that IP 

address and eventually found out where the e-mail was being sent to. 

That is the reason you did this. You didn’t do this for a statistical sort of 

information purpose. You were going to use this to find out where those 

e-mails were being sent. That is obvious to everybody in this room. So 

that is pretty clear. 
148

Now, you said you don’t do it to your customers. I can see a 

situation where HP would want to know if your customers are having 

communication with your competitor, for instance, a potential contractor 

who is a competitor of yours. Is there an internal policy that prevents 

any of your thousands of employees from doing that? 

MR. ALDER. I would consider it in violation of our Standards of 

Business Conduct, yes. 

MR. INSLEE. And what standard would it violate? 

MR. ALDER. Since I don’t have them in front of me, I can’t 

specifically recall which one would be the specific one that would apply 

in this case. I am sorry. 

MR. INSLEE. Well, Mr. Sonsini, is the use of that trace technology 

legal, in your opinion, under Federal and/or State law? 

MR. SONSINI. That is a great question. I think that the law regarding 

that is not as clear as it should be. Depending on how it is used and the 

methodologies, it could very well implicate Federal or State statutes. 

I think the whole area is an area that we probably need more clarity. 

MR. INSLEE. I agree with that assessment, and we--many of us have 

been trying to get more clarity regarding privacy laws, including the 

Chairman and Mr. Barton have been involved in some efforts in that 

regard. We have been stymied. We have this simple bill, just so you 

will know what is going on here in Congress--we have this--you know, a 

bill that we all voted for unanimously we can’t even get House GOP 

leadership to schedule for a vote now. 

But let me ask you this: Do you think, knowing what you consider 

to be a grayness in this area, would you suggest that there should be 

statutory codification clarifying this situation regarding trace technology 

in these e-mails? 

MR. SONSINI. I think so. We do have computer statutes that make 

invasion of computer hardware illegal. And I am not an expert on how 

tracers are used in invasion, but if there is invasion of computers, we 

probably have good coverage. 

But in the whole area of pretexting and the various methodologies 

used, I agree with the statements of many members of your Committee 

that we should have more clarity in that area. That does not mean that 

methodologies that are employed cannot be in violation of law, existing 

law. 

MR. INSLEE. I want to get a clarification of something that I just did 

not understand. I understood you in earlier testimony you said 

something to the effect that this pretexting and similar type of efforts 

were a violation of privacy and should not be common, something to that 

effect. And what I didn’t understand about that is that you receive this 

draft--I understand it was a copy sent to you from Mr. Hunsaker--which 
149

described the pretexting that had gone on in considerable detail. Then 

you wrote--that was on June 21st, 2006. 

Seven days later on June 28, 2006, you wrote an e-mail to 

Mr. Perkins basically saying everything is hunky dory, there is nothing 

illegal. And I am reading this document, this e-mail from you, that 

doesn’t--a fair reading of it, I think, is raising no red flags or a concern 

from you as counsel. 

Now, given your testimony to us today that you consider pretexting 

to be--sinful is the wrong word, but unacceptable, a violation of people’s 

privacy, how do you juxtapose this when you’re a lawyer--you have been 

told this is going on with one of your treasured clients, somebody asks 

you for a report, you send them an e-mail, and you don’t raise any red 

flags whatsoever. I have trouble reconciling that. 

MR. SONSINI. Let me explain it. As I have testified to several times 

today, and I would like to elaborate on again, that e-mail to Mr. Perkins 

was not a legal opinion because, A, I had not conducted any research; B, 

I was not aware at that time of the methodologies used, I was conveying 

the opinion of the HP legal department. 

MR. INSLEE. What do you mean you didn’t know the methodology? 

That is where I had trouble. You were told in this that they were doing 

pretexting. 

MR. SONSINI. Yes, and pretexting generally, other than the 

Gramm-Leach-Bliley Act relating to financial institutions, is not illegal. 

It depends upon the methodologies in pretexting. For example, if 

Social Security numbers are used, then it is very likely that there is a 

violation of a Social Security statute. There are other laws; the Federal 

Trade Commission takes a viewpoint it could be an unfair trade practice. 

The point is that as members of the Committee have said, we need 

more clarity. You have a bill in the House now that is designed to clear 

things up. 

MR. INSLEE. Let me ask just a simple question. Pretexting to 

anybody here means you call up and you lie about your identity in order 

to get information. To any lawyer or layperson, that is what it means. 

You were told that people in HP were calling up to get phone 

records, lying about their identity, and getting that phone record. And 

then you sent an e-mail that didn’t raise any concerns suggesting that it 

stop, suggesting that the method be investigated. You didn’t suggest 

whether Social Security numbers were involved. You did not suggest 

that you clarify as to whether or not you were violative of these. You 

didn’t suggest anything suggesting that this thing was unacceptable. And 

I just find that unacceptable. I don’t understand it. 

MR. SONSINI. I want you to understand it. It is a fair question. I 

didn’t know what pretexting was. 
150

There was--I had no knowledge of the methodologies. I did not 

know Social Security were used. That is the problem. At the time that I 

sent that e-mail, I was being as open and transparent as I could. I was 

not an expert in these matters. I did not know what pretexting meant at 

that time. I was not asked to investigate it at that time. I was trying to do 

my job, reporting to him what the HP Legal Department gave me the 

assurances that they did. 

MR. INSLEE. One more question if I can, sir. Do I understand you 

didn’t know pretexting involved lying about the identity? 

MR. SONSINI. I didn’t know what pretexting was. 

MR. WHITFIELD. The gentleman’s time has expired. 

Ms. Eshoo, you are recognized for 10 minutes. 

MS. ESHOO. Thank you, Mr. Chairman. 

I think that there is an awful lot that has been set down for the 

record, and I think that Members have really asked excellent questions 

from both sides of the aisle. 

I have a few questions. I don’t know whether I will use the 

10 minutes or not, but I want to go to Mr. Adler first, again. 

Are you aware of any rusing that has been used in anything at HP? 

Is it something employed by HP? Did you hear me? 

MR. ALDER. No, not really. This is an unusual circumstance as far 

as my knowledge is concerned. You said rusing, correct? 

MS. ESHOO. Uh-huh. 

MR. ALDER. No. This is pretty much--this is unusual. It is not 

something that--are you maybe-- 

MS. ESHOO. I don’t want your opinion about what you think of it. I 

want to know if it is something that is practiced or used. Is it a tactic that 

is used or has been used at HP? 

MR. ALDER. What do you consider to be a ruse so I can better 

answer my question? 

MS. ESHOO. You were just describing it to me. If you don’t know, I 

will describe it to you. 

MR. ALDER. If you want to talk about the use of the e-mail by the 

name of Jacob, that is the first time we have ever employed that, to my 

knowledge. If you want to talk about the tracer technologies in that 

context, then we have used it probably, as I said, a dozen times that I am 

aware of. 

MS. ESHOO. It is a few shades off from the pretexting for sure, but it 

is still a deceptive method that is used to secure information. It could be 

used by an employee, used by a relation to impart or to convince the 

third party that it is the authentic party requesting the information. If you 

are saying no, then I will accept your answer. But-- 

MR. ALDER. Okay. 
151

MS. ESHOO. You said no? 

MR. ALDER. No in regard to what? 

MS. ESHOO. Well, you know what, you have to be smart to play 

dumb. So I think I have been pretty direct about my question. I asked 

you if rusing has been used. Then you asked me to define it. I give it to 

you, and then you are confused? 

MR. ALDER. Yes. Rusing, it has been used. 

MS. ESHOO. It has been used? 

MR. ALDER. Yes, ma’am. 

MS. ESHOO. And for how long? 

MR. ALDER. I don’t know. I would probably say probably for the 

last 3 years or so that I am aware of since I have been there. 

MS. ESHOO. Mr. Sonsini, what is there today in terms of our laws 

that direct themselves to the situation that the HP Board found itself in? 

And that is, a director that lied consistently that he had not leaked, when 

it was determined—by pretty bad ways, but it was still determined--that 

he was the guilty party, damaging information, damaging, I think, in 

terms of shareholders, and certainly, in my view, violated his fiduciary 

responsibility. 

In advising the Board or if you were to advise the Board, what are 

the options that are available for a publicly held company when they 

have a director that they can’t fire? I mean, I don’t know what the 

directors’ terms are at HP. They are probably going to go back and look 

at this. There is a lot of talk in politics about term limits. They are going 

to have to look at term limits there or shorten the term limits. 

Is it simply the manual of the ethics of the company, or are there 

other instruments that can be used to be brought to bear in this kind of a 

situation? Because, I don’t think, with all due respect to HP, that this is 

totally unique to them. Human beings make up boards. Human beings 

are less than perfect. God knows, there is leaking. We know sitting up 

here that there are leaks. And this is something that people are tempted 

to do, I am sure, in the private sector as well. So-- 

MR. SONSINI. Well, what we do, and it is a very good question, and 

it is very consistent with what we did back in January 2005 or February, 

first of all, it is very important that boards continually evaluate 

themselves, peer-to-peer evaluations, board evaluations where you have 

candid review of what you are doing and what people are doing. 

Secondly, it is very important that boards adopt guidelines that deal 

with fiduciary duty issues, confidentiality and the like. 

MS. ESHOO. But are there Federal or State laws or agencies, to go to, 

for example, the SEC, and say, our hands are tied, we believe there is 

something wrong here? 
152

MR. SONSINI. No. It is corporate law. It requires directors to 

exercise due care and duty of loyalty and duty of candor. And if they 

step over the bounds, then they are in breach of that fiduciary obligation. 

They lose the protections of the business judgment rules that shield them 

from liability. So they have personal liability exposure, and that is the 

tone at the top that you have to-- 

MS. ESHOO. Can the corporation sue them for this if they determine-

- 

MR. SONSINI. Yes. If a director breaches a fiduciary duty and harms 

a corporation, the corporation that has been harmed can bring legal 

action, yes. 

MS. ESHOO. Well, there is an area where the law really comes into 

play, and that is in terms of tipping, but that is a whole other standard. 

That is a whole other standard. 

Ms. Dunn, thank you. 

Ms. Dunn, you have testified today more than once that you didn’t 

direct the investigation; it was, in other words, this was an internal unit 

within HP management, that they executed and contracted out or had 

someone on retainer that did this. 

Now, you also said that you found out what other members asked, 

others that were investigated. And how did you find out that you were 

pretexted? Is it through the press, or you were told that you were going 

to be? 

MS. DUNN. No, I was not told I was going to be, but in all candor, 

there has been such a torrent of information that has come to me in the 

last 3 to 4 weeks about this matter, I can’t tell you how I found out, but it 

was within the last 3 or 4 weeks that it came, someone told me that I had 

been pretexted, which I didn’t--I hadn’t realized previously. And I am 

sorry, I just can’t remember who told me. If I could consult with my 

attorney, he may remember, but I don’t. 

MS. ESHOO. I just thought it was interesting in terms of your 

testimony that you were as well. 

So was the whole Board investigated by-- 

MS. DUNN. My understanding-- 

MS. ESHOO. Maybe Mr. Adler knows. Mr. Adler was the entire 

Board investigated? 

MR. ALDER. Yes, ma’am. 

MS. ESHOO. Everyone? 

MR. ALDER. Yes, ma’am. 

MS. ESHOO. All nine? 

MR. ALDER. Yes. 

MS. DUNN. That is the first I am knowing this fact, so that is an 

interesting fact. 
153

I would like to throw in that, you know, the attitudes by directors 

toward their privacy versus the confidentiality of the company they serve 

seems to be very different from the general public. I will draw your 

attention to an Associated Press survey that was done in the last week to 

10 days-- 

MS. ESHOO. I saw that. I read that in your extended testimony. I 

thought that was very interesting. 

MS. DUNN. And it turned out that 85 percent of directors surveyed 

believe that their personal privacy was secondary as director to the needs 

of a company to uphold confidentiality. And I have had directors say to 

me since this matter broke, many directors from well outside of HP, that 

when they join a public company board, they assume away a lot of 

privacy rights. It comes with the territory. 

Now, I am not condoning the misrepresentation of identity through 

pretexting. I have said and would like to repeat that. I think there needs 

to be a much clearer legal backdrop for that activity. 

MS. ESHOO. I want to get back to--I have my needle stuck on 

something. 

From what I am hearing is that regardless of what a member of a 

board, a director, does, there really are not tools or instruments to remove 

that member other than kind of appealing to the director and saying, “We 

don’t think you have lived up to your fiduciary responsibility,” or 

whatever the case may be. 

Is there something, or is there not? I mean, what is there to prevent 

this in the future? And are there any instruments to indeed punish 

someone if they don’t live up to that? Is it simply--I shouldn’t say 

simply--I know that the standard of business conduct is very important, 

but is there anything else? 

I think Mr. Sonsini probably wants to answer that. 

Thank you, Mr. Chairman. 

MR. SONSINI. Directors serve at the pleasure of the shareholders. 

The shareholders are the ones that can appoint and remove directors. 

Boards can’t remove directors. 

What boards do is they have to evaluate themselves and decide who 

should stand as director. If a director takes action that harms the 

corporation, that director can be sued and has liability. That is basically 

the state of the law. 

MS. ESHOO. Thank you. 

MR. WHITFIELD. Mr. Markey is recognized, 10 minutes. 

MR. MARKEY. Thank you, Mr. Chairman. 

Ms. Dunn, on page 20 of your testimony, you say that in early 

February of this year, both you and Mr. Hurd were briefed about a sting 
154

operation proposed to send a fake e-mail to a CNET reporter; is that 

correct? 

MS. DUNN. That is my testimony, yes, sir. 

MR. MARKEY. Were you both told that this e-mail would include an 

attachment that had a tracer or spyware in it? 

MS. DUNN. I never heard the word “spyware” in connection with 

this investigation. 

MR. MARKEY. But did you hear the word “tracer”? 

MS. DUNN. I did hear the word “tracer.” 

MR. MARKEY. What did you understand that to be? 

MS. DUNN. I understood it to be a way of confirming the receipt of 

an e-mail by someone who was under investigation. 

MR. MARKEY. So you did not understand it to mean that it would 

perhaps open up then this reporter’s file; that would make it possible then 

to trace where that reporter would be going in terms of phone calls or 

other communications to other people? 

MS. DUNN. No. That is not my understanding of how it works, and 

perhaps Mr. Adler could clarify how it works-- 

MR. MARKEY. What did you understand the word “tracer” to mean? 

MS. DUNN. That it would simply confirm whether a certain e-mail 

had been received and not necessarily by the person, but by someone in, 

let’s say, the area the size of the Bay area. 

MR. MARKEY. So in order to catch a leaker on the Board, an 

investigation was launched. The concern was that these leaks are hurting 

HP. The Board members have a fiduciary responsibility not to hurt the 

company, but to grow it. And so investigating HP directors was deemed 

fair game given their role at HP. 

But what thought was given to whether it was appropriate to spy on 

reporters who have no relationship, fiduciary or otherwise, with HP? 

MS. DUNN. The spying on reporters was not something that was 

brought in any clear way to the attention of certainly me. I don’t know 

about Ms. Baskins, but I did learn on September 6th that reporters had 

been pretexted. 

MR. MARKEY. Can I just say this, Ms. Dunn? I understand that you 

are the Chair of HP. 

MS. DUNN. I was the Chairman. 

MR. MARKEY. You were the Chairman of HP, and it is one of the 

leading technology companies in the world, and you are testifying here to 

a decided lack of knowledge of technology and its uses, which to a 

committee with jurisdiction over the telecommunications industry, is a 

little bit disconcerting, to be quite frank with you. 

MS. DUNN. May I respond to that? 
155

MR. MARKEY. You may. But we are only congressional experts, but 

that means we are only experts compared to other Congressmen. 

MS. DUNN. I am not an expert in technology, and that was not my 

role on the HP Board. A board is composed of individuals who have 

different skills-- 

MR. MARKEY. I understand what you are saying. 

MS. DUNN. My particular skills were not in technology, and that was 

not the role I fulfilled on the HP Board. I was considered a financial 

expert. And ironic as it may seem to you now, I was also an expert in 

corporate governance. 

MR. MARKEY. So who believed it was appropriate to spy on 

non-Hewlett-Packard individuals in this investigation, Ms. Dunn? 

MS. DUNN. I don’t know who at my level or Mark Hurd’s level 

considered it was appropriate to spy on reporters. 

MR. MARKEY. Are you saying that you didn’t understand that the 

attachment with the spyware was an intrinsic part of the sting? You 

didn’t understand that? 

MS. DUNN. The word “spyware” was never a part of what I 

understood to be the case. 

MR. MARKEY. Or some similar type of term to describe what was 

going to be--what the plot was with regard to this report, not necessarily 

spyware. 

MS. DUNN. Well, as Mr. Adler has testified, this is a common 

investigative technique that has been used, and I am just quoting his 

testimony, one to two dozen times at Hewlett-Packard in sensitive 

investigations. It is still the policy of HP that this technique is a standard 

and acceptable part of its arsenal in investigative methods. 

MR. MARKEY. Did you receive any substantive reports as to the 

subsequent success or failure of this sting? 

MS. DUNN. I heard, by the by, that it didn’t work. 

MR. MARKEY. That it didn’t work. And can you give a name to the 

vine? Does the vine have a name? 

MS. DUNN. No. No. I was saying by the by. I heard somewhere 

within the chatter, if you will, that it hadn’t worked. I don’t recall a 

specific communication. 

MR. MARKEY. And how often is this technique used on non-HP-- 

MS. DUNN. I don’t know. The only knowledge I have of it firsthand 

is in this matter, and I was quoting Mr. Adler’s previous testimony as to 

its use at HP otherwise. 

MR. MARKEY. Mr. Adler, how often is this technique used on 

non-HP individuals? 
156

MR. ALDER. I can only speak from my own personal experience, 

and I would venture a guess as to the rest, sir. I know that I have used it 

at least on two occasions on non-HP persons. 

MR. MARKEY. And who were those persons? 

MR. ALDER. Excuse me? 

MR. MARKEY. Who were those persons? 

MR. ALDER. One was the reporter, Ms. Kawamoto, and also on a 

suspected theft suspect in Houston. I don’t recall his name. 

MR. MARKEY. And to the best of your knowledge, those are the only 

two occasions where HP used this technique on non-HP individuals? 

MR. ALDER. The only 2 occasions that I used it. I know that my 

coworkers have also used it. I know that law enforcement uses it. 

MR. MARKEY. I am talking about just HP itself, not law 

enforcement. You are saying that at HP it has been used by other 

individuals as well on non-HP individuals? 

MR. ALDER. Yes, sir. 

MR. MARKEY. How prevalent? Are you talking about a handful of 

times, or is it a prevalent practice? 

MR. ALDER. I think I offered earlier, one to two dozen times I 

estimate in totality. 

MR. MARKEY. Mr. Sonsini, you are one of HP’s outside legal 

counsels. Were you at all involved in the company’s 8K filing made 

earlier today, disclosing the fact that HP had concluded an agreement 

with Ms. Baskins that provides her with a multi-million-dollar golden 

parachute? 

MR. SONSINI. No, I was not. 

MR. MARKEY. Thank you. 

Mr. Adler, you say that you were advised that this opinion was the 

result of a review by at least two attorneys. Were you told who the two 

attorneys were who provided the legal opinion that you relied upon? 

MR. ALDER. The two attorneys that I referenced were Mr. Hunsaker 

and an outside attorney whose name I don’t know. 

MR. MARKEY. Now, Mr. Adler, did you ever read any legal memos 

or e-mails from these two attorneys that explained their basis for their 

opinion? 

MR. ALDER. No, I did not. 

MR. MARKEY. I would like to turn to a Saturday, January 28, 2006, 

e-mail that HP senior counsel Mr. Hunsaker sent, and also a copy to 

HP’s Global Security Manager Mr. Gentilucci and your colleague 

Mr. Nye. This e-mail says this: “Hi Fred, apparently Perkins almost 

never uses his cell phone and instead does just about everything by way 

of text message. Is there any way to lawfully get text message content, 

or is it the same as his cell phone records?” 
157

Now, when Mr. Hunsaker writes to you, “Is there any way to 

lawfully get text messages content, or is it the same as cell phone 

records,” doesn’t that suggest that as of January 28, 2006, that 

Mr. Hunsaker already was aware that getting phone records was illegal? 

MR. ALDER. Illegal--possibly, yes. 

MR. MARKEY. I think it is clear it is yes. Is the law the same as cell 

phone records that you can’t get them? So he knows in January of this 

year that it is illegal. 

Now, Mr. Adler, just 13 minutes after this e-mail was sent to you, 

you replied back to Mr. Hunsaker, “Even if we could legally obtain the 

records, which we can’t, unless we either pay the bill or get consent, I 

would highly suspect text messaging records are not kept due to volume 

and expense. The only other means is through real-time interception, an 

avenue not open to us.” 

MR. ALDER. Correct. 

MR. MARKEY. Doesn’t your reply to Mr. Hunsaker indicate that 

you, too, were aware of the fact that it was already illegal to obtain phone 

records unless you are the person paying the bill or you obtained the 

consumer’s consent? 

MR. ALDER. Correct, sir. 

MR. MARKEY. So you believed it was illegal as well in January? 

MR. ALDER. In January, yes, sir. Yes, sir, I had. In January, yes, I 

did. 

MR. MARKEY. So you believed it was illegal in January. 

MR. ALDER. Yes. 

MR. MARKEY. And so this is something as a result that had a long 

fuse inside of HP, this knowledge that this was illegal activity. In other 

words, we don’t have to pass any new laws to make this illegal, it is 

illegal right now. 

And you knew, others knew, and it is clear that, from my 

perspective, Mr. Perkins at least came to know that and appreciate that 

fact, and it disturbed him greatly. 

So I know that we are just at the tip of the iceberg here, Mr. 

Chairman, but this is very disturbing testimony that we are receiving, 

and, again, I want to congratulate you for conducting the hearing. 

MR. WHITFIELD. Mr. Markey, I would like to comment that there 

has been a lot of discussion today about the importance of passing this 

pretexting bill that was reported out of this committee, I guess almost 

unanimously, but I think the record also does reflect that existing 

California law and the Wire Act, the Federal Wire Act, and the FTC’s 

civil penalties, that it already is illegal. I think we can make a strong 

argument--which is the point you were making. 
158

And I would also just reiterate, as we close up with this panel, that 

we hear--we heard a lot of discussion about the Board members being the 

subject of this investigation, but I don’t think any of us want to forget 

that there were nine other people who were not Board members. They 

were members of the news media and other employees of the company 

that were also investigated. 

And, Ms. Dunn, in closing, you have made it pretty clear today in 

your testimony that as the Chairman of the Board, the Board members 

came to you and urged that you conduct this investigation. And you 

turned it over to the management team, the investigative team. And we 

have heard a lot about the investigative team doing the daily work and 

making the decisions and setting the techniques and whatever. I 

understand that team to be--and I am not trying to put words in your 

mouth, and you can correct me if I’m wrong--but the team, in your mind, 

it was Ann Baskins, Mr. Hunsaker, Mr. Gentilucci, and who else? 

MS. DUNN. For the investigation that was conducted in 2006, the 

team, the investigative team, was headed by Mr. Hunsaker reporting to 

Ms. Baskins. The only other names that I knew before today or recently 

were Mr. Gentilucci and Mr. DeLia. I don’t know who else was on the 

team. 

MR. WHITFIELD. So from your perspective, when you talk about the 

team, the investigative team, it is those four people. 

MS. DUNN. To my knowledge, yes. There may have been others. 

MR. WHITFIELD. Okay. Now, just one final point here. And we 

have gone over this a couple of times, but on Wednesday, February 22, 

2006, Kevin--it is in Tab 62 if you want to look at it. I think you have 

already looked at it. There was an e-mail from Kevin Hunsaker to you, 

and he talks about this electronic tracer in this e-mail that they wanted to 

send to the reporter for CNET. And I think her name is Dawn, Dawn 

Kawamoto. And it simply said, “HP has come up with a name for its 

next-generation data centers. Mark is meeting with the WSJ and maybe 

others on the 27th. Pulled this from the presentation slides. Jacob.” 

So this is the Jacob that is the fictitious character and person who did 

not exist, and you have already said that the words you used in replying 

were not particularly good. And if you had to do it over again, you 

wouldn’t say it, but you said--“I think this is very clever--but as a matter 

of course, anything going outside HP I hope that Mark--we should have 

Mark’s approval.” And then Kevin wrote back to you on the 23rd, the 

next day, saying, “For your information, I spoke to Mark a few minutes 

ago, and he is fine with both the concept and the content. We will either 

send out this afternoon or tomorrow morning, and I will keep you 

posted.” 

Is that your understanding of what happened? 
159

MS. DUNN. I think that reflects what happened, yes. 

MR. WHITFIELD. And do you know if Mark Hurd knew about the 

tracer technology? 

MS. DUNN. I don’t know firsthand. I think that is a question you 

will have to ask him. I am sorry, I am not trying to be unresponsive, but 

it would be hearsay. 

MR. WHITFIELD. You said you have heard about hearsay on it? 

What hearsay? 

MS. DUNN. I have heard a lot of legal terms in the last-- 

MR. WHITFIELD. But on this issue have you heard-- 

MS. DUNN. It would be a communication--my understanding, it was 

a communication from Mark to the team as reported by me would be 

hearsay. So I am simply suggesting that he would be the better person to 

respond to your question. 

MR. WHITFIELD. But you don’t have any other knowledge on this 

particular issue except for what is in this e-mail, you said, other than 

hearsay, which would indicate to me that you have heard additional 

information about whether or not Mr. Hurd knew about the tracer. 

MS. DUNN. What I know is reflected by what is in the e-mail, and in 

response to your question about how or what Mr. Hurd did, I am simply 

saying it would be speculation on my part as to how he responded to the 

team. 

MR. WHITFIELD. Can you tell us what this hearsay is? 

MS. DUNN. I assume that since they did it, he gave his approval. 

MR. WHITFIELD. You assume. Okay. 

MS. DEGETTE. Would you yield, Mr. Chairman? 

Did you ever talk to Mr. Hurd about this? 

MS. DUNN. No, I did not. 

MS. DEGETTE. So you just heard secondhand he had approved it? 

MS. DUNN. That is what I was just trying to say. 

MS. DEGETTE. You know, this is not a court of law even though it 

might feel like one, sometimes. So you can testify to hearsay you may 

have heard. 

MS. DUNN. I am trying to be responsive. I just don’t want to put 

words in someone’s mouth that I didn’t hear. 

MS. DEGETTE. Sure. 

With that caveat, what did you hear? 

MS. DUNN. What I understood was that since this action went 

forward, my assumption is that it was based on what the e-mails say, 

which is that he gave his approval. 

MS. DEGETTE. Thank you. 

MR. WHITFIELD. Well, that concludes questions for this panel, and I 

want to thank you all for your patience. And this panel is now dismissed. 
160

And I do want to--if there is not any objection, I am going to enter into 

the record at this point the document books, the two document books. 

And in addition to that, I would like to enter into the record the 

report by Larry Sonsini’s firm regarding this presentation made before 

the Board about this investigation dated August 30, 2006. 

So without objection, we will enter that into the record. 

[The information follows:] 
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MR. WHITFIELD. You all are dismissed. Thank you very much for 

being with us, and at this time this is the final witness of the day, and that 

is Mr. Michael--Mark Hurd. Mr. Mark Hurd. 

Mr. Hurd, we welcome you to the committee today, and I-- 

MR. HURD. Thank you. I can’t see you. 

MR. WHITFIELD. I can barely see you, but I know you are there. 

MR. HURD. Thank you. 
728

MR. WHITFIELD. And we do appreciate very much your being with 

us today to shed additional light on this important matter. 

And as you know, an oversight investigation takes its testimony 

under oath, and I am assuming you have no objection to testifying under 

oath. 

MR. HURD. Not at all. 

MR. WHITFIELD. So if you wouldn’t mind standing and raising your 

right hand, I will swear you in. 

[Witness sworn.] 

MR. WHITFIELD. You are now under oath, and under the rules of the 

committee and rules of the House, you are certainly entitled to legal 

counsel. And if you do have legal counsel with you today and would 

like to introduce them, that would be great. 

MR. HURD. I have no personal legal counsel. I have some company 

counsel. 

 MR. WHITFIELD. Okay. Well, you are now sworn in, and we look 

forward to your testimony, and I recognize you for 5 minutes for your 

opening statement. 

 

TESTIMONY OF MARK HURD, PRESIDENT, CHIEF 

EXECUTIVE OFFICER, AND CHAIRMAN OF THE BOARD, 

HEWLETT-PACKARD COMPANY 

 

MR. HURD. Thank you, Mr. Chairman, members of the committee, 

thank you for the opportunity to appear before you today. 

My name is Mark Hurd. I am with the Hewlett-Packard Company. I 

know that you have heard a lot of testimony. I know you have a lot of 

questions as a result. Before we do get to those, I would like to try and 

provide a larger context to you as to what you have heard. 

And what is really hardest for me to explain is this: HP is a company 

that has consistently earned recognition for our adherence to standards of 

ethics, privacy and corporate responsibility, and yet these practices that 

we have taken such pride in have recently been violated by people inside 

the company and by people outside the company whom we hired. 

This committee rightfully wonders what happened. What began as a 

proper and serious inquiry of leaks to the press of sensitive company 

information became a rogue investigation that violated our own 

principles and values. There is no excuse for this aberration. It 

happened, and it will never happen again. 

Before I do anything else, I want to apologize to those whose privacy 

was infringed upon. This includes nine journalists and their families, 

two current HP employees, seven former or current HP Board members 

and their families. In varying degrees these individuals were 
729

investigated through the use of pretexting, a technique used to obtain 

their telephone call information. 

In addition to a heartfelt apology, I want those whose privacy was 

violated to know that we will soon provide to the victims the details 

regarding the information obtained about them, the means by which it 

was obtained, and when it was obtained. 

I also want to apologize to the employees of Hewlett-Packard, who 

on a daily basis carry on their work with the highest integrity. They are 

the reasons HP has been recognized so often for their ethics. This 

current mess in no way reflects upon the vast amount of our employees, 

their work, or their reputation. 

The question remains how did such abuse of privacy occur in a 

company renowned for its commitment to privacy? And it is an age-old 

story that the ends came to justify the means. The investigation team 

became so focused on finding the source of the leaks that they lost sight 

of the values of this company. They lost sight of the values this 

company has always represented. 

This company was built on integrity. If Bill Hewlett and Dave 

Packard were alive today, they would be appalled. They would be 

embarrassed. That is the way the great majority of the people in our 

company feel. 

Members of the committee, I want you to know that I am not putting 

myself above the breakdown that occurred. I wish I had asked more 

questions. There are signs which I wish I had caught. I am responsible 

for the company, which means I am responsible for fixing it and leading 

it forward through this hard time. Our culture, our core, which we call 

the HP way, remains strong and ethical, but clearly changes are in order. 

Mistakes will happen, and these are very serious and unsettling ones 

that we have been discussing, but what matters ultimately is how a 

company addresses the mistakes. HP has taken specific actions and will 

take further actions in the days and weeks ahead. 

We have accepted the resignation of our previous Chairman and our 

General Counsel. Other employees have left the company. We have 

appointed a new lead independent director. We have appointed Bart 

Schwartz, the former head of Criminal Division of the U.S. Attorney’s 

Office of Rudy Giuliani, to do an assessment of current practices and 

develop future best practices so our processes will always be legal, 

ethical, appropriate and without peer. We are putting into place new 

measures to maintain the highest levels of information privacy. 

In summary, the big picture of what happened is that we began an 

investigation of our Board for leaks and have ended up investigating our 

investigation. 
730

I pledge three things to the committee, to our employees and to our 

shareholders, and to those whose privacy was violated. I pledge that I 

will dig harder and deeper, and I will get to the bottom of this. I pledge 

that HP will take whatever steps necessary to make sure nothing like this 

ever happens again. And I pledge that this company will regain not just 

its reputation as a model citizen with the highest ethical standards, but 

we will regain our pride. 

Thank you for the privilege of speaking today, and, Mr. Chairman, I 

will be happy to answer questions of you and the committee. 

MR. WHITFIELD. Thank you, Mr. Hurd, and we appreciate those 

comments. 

 [The prepared statement of Mark Hurd follows:] 
731

PREPARED STATEMENT OF MARK HURD, PRESIDENT, CHIEF EXECUTIVE OFFICER, AND 

CHAIRMAN OF THE BOARD, HEWLETT-PACKARD COMPANY
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741

MR. WHITFIELD. After listening to the testimony of Ms. Dunn all 

day today, I come away from her testimony with the thought that she is a 

particularly strong individual, that she is quite focused, and from 

information I read about her, she is pretty meticulous. And I am sure she 

was determined to get to the source of the leaks out of the Board and was 

successful in doing that. 

But she also made it quite clear to us that despite all sorts of 

evidence to the contrary--there was all sorts of evidence that she knew 

about pretexting early on--and every time we raised that evidence with 

her, she said, well, I don’t think that is accurate, or, I don’t recall that, or, 

I have never seen that, or, it was not mentioned to me, or whatever, 

whatever. And she did consistently say, I turned it over to the 

investigative team. 

Now, in your mind--and I guess today it seems like this investigative 

team was the only thing going on at Hewlett-Packard, but I am sure there 

were lots of things going on at Hewlett-Packard. And maybe this was 

not even a priority at that time, but from your perspective, who was the 

investigative team among employees at Hewlett-Packard that were 

responsible for this matter? 

MR. HURD. I understand, Mr. Chairman. Let me do the best I can, 

and the context I would like to provide you is that I started with the 

company in April of ‘05, so there is some time here that predates my 

arrival to the company. 

Sometime in December, January of ‘05 there were--I am sorry, 

December ‘04, January ’05, there were some of these leaks, I have come 
742

to learn; that as I came to the company, this had created quite a bit of 

sensitivity around the Board. 

So there was an effort started roughly in that timeframe--and I think 

Mr. Sonsini talked to some of that--to begin the process of trying to 

investigate those leaks. There’s really, two phases as I have come to 

understand it now, of this investigation. 

The first phase, which you have heard referred to as Kona 1, really 

was an investigation that emanated from a private investigator who had a 

relationship with the Board. Some of it actually emanated from the 

background check that the Board did on the CEO, meaning me. And that 

continued on into Kona 1. That really did not have a lot of HP resources 

in the investigation, as you might think about it. 

In the second phase, which really started after the Palm Springs leak 

that occurred, that actually had a different team on it. So think of this as 

two separate teams. 

At the conclusion of the Palm Springs meeting, Ms. Dunn asked me 

if she could use HP resources to pursue the leak, to which I said yes. 

That is where the second team came in place, where the new names 

you hear now would be Kevin Hunsaker and the team below Kevin. I 

know this sounds complicated, but there actually are two different 

groups. 

MR. WHITFIELD. But on Kona 2, the names that she gave are the 

four or five--four names that you would identify also. 

MR. HURD. Yes, Mr. Chairman. Yes, sir. 

MR. WHITFIELD. So you would be in agreement with her on that? 

MR. HURD. Yes. 

MR. WHITFIELD. Was it your understanding that they did report--did 

they report to you, or did they report to Ms. Dunn? 

MR. HURD. Well, this gets to the complexity of the governance of 

this. This is just not as straightforward as--I know how much the 

committee would like to get at it this way. You have a Chairman, you 

have a CEO, and that is me. And the chairman clearly was appropriately 

pursuing these leaks. The first set of resources really did not have 

anything to do with the company. It was contractors doing the work. 

In the second one, clearly you had a reporting relationship where 

Kevin, who you have heard--Kevin Hunsaker reported in to Ann, but 

clearly as you look at the documents, there was a lot of communication 

going directly to the Board. 

MR. WHITFIELD. As we speak today, all of those people have 

resigned from the company, is that correct, Ann and Kevin and 

Mr. Gentilucci? 

MR. HURD. Correct. 

MR. WHITFIELD. So those three have resigned. 
743

MS. DUNN. Correct. 

MR. WHITFIELD. And then Ms. Dunn has resigned from the Board. 

MR. HURD. Correct. 

MR. WHITFIELD. That is a total of four, and that is where it stands 

right now is my understanding. 

Now, there has been also a lot of discussion today about this e-mail 

sent by a character who did not exist named Jacob. And that was sent to 

a reporter for CNET. And you probably heard this, but Kevin had sent 

an e-mail to Ms. Dunn saying that we want to do this, and here is what it 

is, and Mark Hurd is going to be meeting with the Wall Street Journal, 

and if she gets this, then we think we can trace who is doing the leaking. 

And she said, it is very clever on your part to come up with that idea. 

And we need to get somebody to run it by Mark Hurd before we do it. 

And then Hunsaker wrote back an e-mail and said, well, I talked to 

him about it--and I think this is in Exhibit 52, if you want to look at it in 

particular, but he basically says, I have run it by Mark, and the content 

and concept is fine with him. 

And I would just ask you, do you remember having discussion with 

him about that or-- 

MR. HURD. I can tell you what I remember and also what I have 

learned, so I will try to bring the two together. 

I clearly remember the effort on the part of the team to try to get 

some sort of approval on the content of the e-mail. And I think their 

view was that if there was going to be information put out into the 

market for whatever reason, it needed to be agreed to. 

To the best of my memory and to my knowledge, I remember 

nothing about spyware or any of the other terms that have been discussed 

as it related to the e-mail, but I do remember a discussion about the 

content, yes. 

MR. WHITFIELD. But you are testifying today that as far as the 

details of the mechanics of the way these things work and their real 

purpose, you are not really familiar with it? 

MR. HURD. To the best of my knowledge, best of my memory, I do 

not remember a discussion about that type of methodology. 

MR. WHITFIELD. Now, I know that sometime in March, March 10th, 

I guess, Mr. Hunsaker prepared a report about this entire investigation, 

Tab 72, and in that report he did a pretty thorough job of everything that 

was going on in this investigation. And he sent it to Pattie Dunn, Mark 

Hurd and Ann Baskins, and in there he talks specifically about 

pretexting. And this is after it has already been--they have already 

utilized pretexting for their information. But it is my understanding that 

you really never read this report; is that correct? 

MR. HURD. That’s correct. 
744

MR. WHITFIELD. Were you able to-- 

MR. HURD. Not my finest hour, Mr. Chairman. 

MR. WHITFIELD. But was there any reason particularly that you 

didn’t read it or other pressing matters? 

MR. HURD. I want to make sure I am clear. I am accountable for 

everything that is sent to me, and I should be reading it. I pick my spots 

where I dive for details. This was not a place that was a priority for me. 

It was the day of our shareholder meeting. And, again, I want to make 

sure I am clear. There is no excuse for that. If I had read it, I might have 

picked it up. 

MR. WHITFIELD. From your viewpoint, how significant were these 

Board leaks? As the CEO of the company, was it something that really 

did--did it really disturb you or-- 

MR. HURD. I would say--because I didn’t have the history, Mr. 

Chairman, I did not have the history of the December, January time 

frames. And during my time as CEO, we were not encountering a 

significant number of leaks, so I was probably not as concerned as some. 

MR. WHITFIELD. Okay. I am not here to defend you in any way, and 

I will say that as a Member of Congress representing 650,000 people, 

there are a significant number of reports and letters that I do not read for 

one reason or the other, and I am not defending you, because I do think 

that the way that this issue has come up was certainly much different 

than anyone intended at HP. I am quite confident of that. And it has 

tarnished the reputation of the company, and I think it certainly violated 

the standards of conduct of the company. 

At this time I will recognize Ms. DeGette for 10 minutes. 

MS. DEGETTE. Thank you, Mr. Chairman. 

Mr. Hurd, did you have the opportunity to hear the testimony of the 

previous panel? 

MR. HURD. I heard some. 

MS. DEGETTE. Now, in early January, that was the first you heard 

about this investigation of Board members and the leaks, correct? 

MR. HURD. Just clarity, early January of ‘06? 

MS. DEGETTE. Yes. 

MR. HURD. No. I would say that when I first came to the company, 

there was discussion about the leaks. I can’t give you specifics in that 

April, May timeframe the first few weeks I was there. But in July, as I 

was leaving town, there was a meeting that was designed to plug the 

leaks. 

MS. DEGETTE. But in January, that is when Ms. Dunn came to you 

and she said, we are continuing the investigation, can we use the internal 

resources, right? 

MR. HURD. Yes. 
745

MS. DEGETTE. And you said okay. After that, what did you know 

about the ongoing investigation? Did you know about the searches of the 

trash? 

MR. HURD. No. 

MS. DEGETTE. Did you know about the monitoring of HP 

employees and of--or, I am sorry, of Board members and their families? 

MR. HURD. No. 

MS. DEGETTE. Did you know about the monitoring of reporters? 

MR. HURD. No. 

MS. DEGETTE. No one ever told you about any of this? 

MR. HURD. No. 

MS. DEGETTE. Did you know about the pretexting that was going 

on? 

MR. HURD. No. 

MS. DEGETTE. You didn’t know about the whole Jacob incident? 

MR. HURD. No. Let me go back to my previous testimony as we go 

through these. To the best of my knowledge, I do not remember any of 

the first points that you brought up. 

MS. DEGETTE. Okay. 

MR. HURD. The issue about the e-mail, I definitely knew about the 

content of the e-mail that was going out. There was clearly a 

communication. 

MS. DEGETTE. Did you know about the fake person, Jacob? 

MR. HURD. Yes, I knew about the objective. 

MS. DEGETTE. What was your view of that? Did that seem ethical 

for the investigators to be coming up with a fake individual to be 

e-mailing reporters? 

MR. HURD. Let me try to tell you what was going through my head 

at the time. I certainly was trying to--this was a team that was-- 

MS. DEGETTE. I only have 10 minutes. I am really sorry, yes or no? 

MR. HURD. At the time, I agreed with the content of the e-mail. 

MS. DEGETTE. So you thought that was just fine? 

MR. HURD. It was appropriate to find the leak. 

MS. DEGETTE. To be having fake people e-mailing reporters. Do 

you think that today? 

MR. HURD. With the benefit of hindsight, I wouldn’t do it again. 

MS. DEGETTE. Did you hear when I asked Mr. Sonsini if all of these 

techniques, some of them though they may be legal or ethical for a major 

corporation like you-- 

MR. HURD. I agree. 

MS. DEGETTE. --you agree none of these are ethical? 

MR. HURD. I believe there is a difference between legal and ethical. 
746

MS. DEGETTE. Do you think that HP should have been using 

techniques-- 

MR. HURD. No. 

MS. DEGETTE. --like that to investigate leaks? No? 

MR. HURD. No. 

MS. DEGETTE. Thank you. 

You said that a lot of things broke down here, and that you are trying 

to fix that. So I kind of want to go through where the breakdown was. 

First thing is that we have heard that it is very unusual to have a 

Nonexecutive Board chair; is that correct? 

MR. HURD. I wouldn’t call it unusual, but it is not common practice. 

MS. DEGETTE. Ms. Dunn says it is not done very often, and because 

she was not paid like a CEO, she had no real responsibility to oversee 

what was under her in terms of the investigation. Do you agree with 

that? 

MR. HURD. I--I-- 

MS. DEGETTE. Do you think that because of the structure, that she 

was the Chairman without being--just being an independent Chairman? 

MR. HURD. I believe it is not as simple a governance model as-- 

MS. DEGETTE. Don’t you think that the Chairman of the Board 

should have the same ethical obligations whether or not she is an 

employee of the company? 

MR. HURD. There is no question about that. 

MS. DEGETTE. Okay. So that is not really--I mean--just that 

structural function, that is not why there was a breakdown, right? 

MR. HURD. I agree that there is no difference in ethical behavior no 

matter whether you are a nonexec chair, a chair exec, COO, at any level 

of the company. 

MS. DEGETTE. I suppose you would also agree that the Chairman of 

the Board would have an ethical obligation, if she saw unethical things 

happening in an investigation of her own Board members, she would 

mention it to someone like, say, the CEO, correct? 

MR. HURD. Certainly. 

MS. DEGETTE. Did she ever mention it to you? 

MR. HURD. No. 

MS. DEGETTE. Take a look at Tab 29. This is the initial briefing 

slide show we’ve been talking about with-- 

MR. HURD. Let me catch up to you. 

MS. DEGETTE. Have you ever seen that document? 

MR. HURD. I have now. 

MS. DEGETTE. Had you seen it at the time? 

MR. HURD. I had not. This is basically the draft--no, I’m sorry, let 

me back up. No, I had not seen this document. 
747

MS. DEGETTE. Okay. This is the one that talks about pretrash 

inspection and so on. No one ever gave you that? 

MR. HURD. To the best of my memory, I never saw this document. 

MS. DEGETTE. That’s the first red flag. Take a look at Tab 60. I’m 

getting ahead of myself. Tab 30. 

This is the senior management briefing on Project Kona 2 that we 

were also talking about earlier. It’s a very similar briefing, talks about 

some of the same techniques. Were you ever given that? 

MR. HURD. No. To the best of my knowledge-- 

MS. DEGETTE. Even though it’s a senior management briefing, you 

never saw that? 

MR. HURD. No. 

MS. DEGETTE. Now take a look at Tab number 60. This is the 

e-mail communications between Ann Baskins and various people about 

the Jacob situation. And you have to start from the second page and go 

on, where--and part of that was--did you hear me, did you hear me when 

I was talking to Ms. Dunn about how she had said that they had to have 

your approval of this? 

MR. HURD. Yes. 

MS. DEGETTE. And did anybody come to you for approval of this? 

MR. HURD. This would have been the first I would have seen of it 

that said, “Hi Mark,” the e-mail that says 2/22. 

MS. DEGETTE. Did you see the whole e-mail exchange? 

MR. HURD. No. 

MS. DEGETTE. What I’m saying, on 2/22, when you saw the Hi 

Mark e-mail, the other e-mails that say Hi Ann and Pattie and the rest, 

you would have seen those because they would have been attached to the 

e-mail exchange, correct? 

MR. HURD. Can I just read it for one second? 

MS. DEGETTE. You betcha. 

MR. HURD. I don’t remember seeing this, but I agree that I possibly 

could have. 

MS. DEGETTE. And at that time, you didn’t see anything wrong, as 

you had testified earlier, with this whole Jacob situation? 

MR. HURD. I definitely remember the content, Congresswoman. I 

do remember it; and I agreed with content. 

MS. DEGETTE. Okay. Now, take a look at Tab 72. Are you there? 

MR. HURD. Yes. 

MS. DEGETTE. Now, I think this is the document that the Chairman 

was just talking to you about, the draft of the investigation report, which 

you said that you frankly didn’t read because it was the day of your 

shareholders’ meeting and it was a mistake, right? 

MR. HURD. Correct. 
748

MS. DEGETTE. Now, here’s my question to you is, didn’t you think 

that leaks at the Board level were a very serious problem for the 

company? 

MR. HURD. You know, Congresswoman-- 

MS. DEGETTE. Because Ms. Dunn certainly did. 

MR. HURD. I know that she did, and I appreciate that concern. And 

I am not a supporter of leaks in any way, shape or form. I will tell you 

though, in terms of the priorities of the Hewlett-Packard Corporation at 

the point in time, this was not the CEO’s number one priority. 

MS. DEGETTE. Okay. The reason I just showed you all these 

documents, and there are more, is because you had testified earlier that 

there were--that the rules broke down. I see all of these as red flags in 

the organization that were never caught by anybody at the CEO level on 

down. And I’m wondering if you can tell me how on earth we have such 

a huge breakdown. I mean, you’ve been in corporate America for a long 

time; have you ever--number one, have you ever seen an investigation of 

corporate board members that involved these kinds of tactics that were 

involved here? 

MR. HURD. Congresswoman, I’ve seen a lot of stuff in my career. 

MS. DEGETTE. So your answer would be yes? 

MR. HURD. No, I don’t think I’ve seen anything like this. And there 

is two ways processes break down; they break down because of bad 

processes that don’t have checks and balances, and they break down 

because of poor execution. Those are the two ways. We broke down 

here in both. 

MS. DEGETTE. Okay. My question, though, is you broke down in 

both, but there were regular flags aplenty. Why was it that nobody in 

senior management of Hewlett-Packard caught any of these red flags? 

MR. HURD. I’ll speak for myself, I didn’t catch them. 

MS. DEGETTE. Why? 

MR. HURD. Some was it was attention to detail, as you described. 

There is another piece of it that I will tell you from a checks and balances 

perspective, and a company of our scale, we have 151,000 employees, 

we’re kind of a small city almost and have all the issues that go on in that 

size of an institution. The CEO cannot be the backstop for every process 

in the company. The processes have to be pushed into the organization 

with clear checks and balances and clear accountability. We broke down 

in both. 

MS. DEGETTE. Mr. Chairman, I would just ask unanimous consent 

if Mr. Hurd would be willing to supplement his answer once the internal 

audit is completed, to let us know what internal checks and balances had 

been in place, because frankly this was a breakdown not just at the CEO 

level, but at every level of the legal department and senior management. 
749

MR. WHITFIELD. Thank you. 

Mr. Walden. 

MR. WALDEN. Thank you. Welcome, Mr. Hurd. 

When Ms. DeGette showed you Exhibit 60, I think I heard you say 

that February 22nd was the first time you heard of the e-mail sting 

operation; isn’t that right? That was at Tab 60. Your testimony a few 

minutes ago was that-- 

MR. HURD. It was the first that I remember. 

MR. WALDEN. It was the 22nd of February. Could you turn to Tab 

52? In an e-mail from Pattie Dunn to Ann Baskins and Kevin Hunsaker, 

with the subject line of Konas, on February 9th, she says, and I quote, “I 

spoke with Mark, and he is on board with the plan to use the info on new 

hand-held leader. He also agrees we should consider doing something 

with the adaptive enterprise branding issue, given there is some chance 

that D.K. will seek clarification on this from her CNET source. Regards, 

Pattie.” Are you the Mark in that e-mail? 

MR. HURD. Yes, I am. 

MR. WALDEN. Does this refer to the Jacob e-mail? 

MR. HURD. No. It may have been using the same name Jacob, but 

they were two separate content subjects; one was the Next Generation 

Data Center, the first was the handheld person in the organization who 

would be brought out. 

MR. WALDEN. But does this relate to the e-mail that would go to the 

reporter with false information? 

MR. HURD. Congressman, I want to make sure I’m clear with you. I 

can’t give you the detail of how the delivery, what was combined and not 

combined and what the methodology was. I do remember this content, 

yes. 

MR. WALDEN. So this was talking about what would go to D.K., 

who is the reporter-- 

MR. HURD. One of the two subjects that would go potentially to the 

reporter. 

MR. WALDEN. Right. I guess the point is you told us February 22nd

is the first time that you’re aware of this e-mail, and actually this was a 

February 9th e-mail to you about a conversation-- 

MR. HURD. I was trying to divide the two subjects, but I accept your 

point. 

MR. WALDEN. Okay. So you probably knew before February 22nd? 

MR. HURD. February 9th was the discussion about the hand-held, 

yes. 

MR. WALDEN. You’ve undoubtedly heard the testimony by 

Ms. Dunn, who took no blame for this. I mean, she was asked very 

clearly by my colleague, Mr. Stearns, do you accept any culpability, any 
750

blame, she said no, and basically pushed it off on Ann Baskins as legal 

counsel, or others in the management side. 

If she had no blame, and it was Ann--do you think it was Ann 

Baskins’ fault, was she in charge? 

MR. HURD. Congressman, I want to make sure I’m clear with you, 

I’m in charge of the company. 

MR. WALDEN. So it wasn’t Ann Baskins-- 

MR. HURD. I’m responsible for HP, Pattie was the Chairman. 

Responsibility goes across the entire company, Congressman, including 

myself. 

MR. WALDEN. So why did Ms. Dunn resign? 

MR. HURD. After deliberations from the Board, and the Board 

decided to change the leadership of the Board. 

MR. WALDEN. They asked for her resignation? 

MR. HURD. Yes, sir. 

MR. WALDEN. Why, if she wasn’t to blame? 

MR. HURD. Well, I’m back to Board deliberations, Congressman. 

And I think there was a combination of effects, some of which was the 

concern about the ability to lead the company going forward, lead the 

Board going forward, given what had transpired. 

MR. WALDEN. All right. In the Sonsini interview with Ron DeLia 

on Kona 1, which is Tab--we’ll get you the number here, sir--115, item 

number eight. 

MR. HURD. I’m sorry, I’ve got to go to another book. 

MR. WALDEN. I understand. 

MR. HURD. I’m sorry for that. 

MR. WALDEN. No, we appreciate the willingness of you all to make 

all these documents available. 

On number eight it says, “DeLia recalls a specific meeting in Palo 

Alto in July 2005, in which he met with Dunn, Ann Baskins, Mark Hurd, 

Jim Fairbaugh, Kevin Huska, Tony Gentilucci regarding the 

investigation. When DeLia arrived for the meeting, Baskins, Gentilucci, 

Fairbaugh and Huska were already in the meeting. When DeLia arrived, 

Hurd was not in the meeting; he appeared to have stepped out 

temporarily, but he stepped back a few minutes later. DeLia did not 

recall whether Hurd was present for any discussion of phone records.” 

Do you recall if you were there for a discussion of those phone 

records? 

MR. HURD. No. But I remember the meeting, it was the day of a 

Board meeting, the Board meeting was either still going on or ending. I 

was relocating--I know you have a limited amount of time, I was 

relocating back home. I was just going back home because I was still 
751

living in Ohio. And I had to leave early, got there late, and that’s what 

happened. 

MR. WALDEN. So you don’t remember any discussion about 

methodology? 

MR. HURD. I really don’t. Clearly the focus in the meeting was that 

they had not figured out who the leak was. 

MR. WALDEN. Okay. And that was on Kona 1. 

MR. HURD. That was Kona 1. 

MR. WALDEN. And then we go on to Kona 2. And again, you heard 

this, I mean, I’m trying to sort out--who made the decision that allowed 

this to go forward? Because we all sort of thought Ms. Dunn did, but I 

didn’t get the impression that she thought she did, and then she sort of 

said you-- 

MR. HURD. Let me make sure I am very clear with you on my 

opinion. This was a leak at the Board level, Pattie took it very seriously. 

And by the way, let me add, appropriately. She came to me and asked to 

be able to use HP resources, which came into the legal department, 

which is where the name Ann Baskins comes in. Pattie then was the 

business owner, I would describe it, of all of that, using HP resources to 

go execute. 

MR. WALDEN. And I guess what I was troubled about was we had a 

lot of e-mail traffic back and forth to the investigators from her on pretty 

specific levels, and yet when we ask her about her involvement, it 

seemed to be it was a 30,000 foot level, and yet she’s naming the name 

of the investigation, she’s providing phone numbers, there are other 

e-mails from people saying she wants very specific things in the report, 

techniques, resources, but she doesn’t have any recollection of any of 

that. Do you see why we’re troubled by what we’re hearing? 

MR. HURD. I can understand why you’re troubled by the whole 

thing; I understand, Congressman. 

MR. WALDEN. And did you ever think that there would be--what I 

asked about access to public--that she thought you could just get 

somebody’s phone records through public means? Did you believe that 

was possible, that I could just somehow-- 

MR. HURD. I would be speculating. I’m not just an expert in this 

area. I’ve come to learn a lot, and I’m very-- 

MR. WALDEN. I mean, come on, did you ever think you could just 

pick up a phone somehow and get my phone records or I could get 

yours? 

MR. HURD. Congressman, it wasn’t something I thought about; and 

I’m sorry, I just can’t give you a comment on that. 

MR. WALDEN. I can’t imagine that that would be legal or 

appropriate--would you think it’s appropriate? 
752

MR. WALDEN. I would not want somebody, without my permission, 

to have my cell phone bill. 

MR. WALDEN. Or your cell phone records? 

MR. HURD. The cell phone records or cell phone bill. I wasn’t 

trying to be cute with my answer. 

MR. WALDEN. If you could turn to Exhibit 77. This e-mail states 

that Tom Perkins called you before the March 2006 Board meeting and 

asked you about the status of the investigation. Do you recall that 

conversation with Mr. Perkins? And I’ll let you get caught up there, sir. 

MR. HURD. I have a different--I have something that says Kevin 

Hunsaker to Tony Gentilucci under 77. 

MR. WALDEN. Right. And it says on the second paragraph, “It’s 

also worth noting that a few days before the March 2006 Board meeting 

Perkins called Mark Hurd and asked him, among other things, about the 

status of the investigation of the leaks. Hurd told Perkins the 

investigation team had assembled a significant amount of circumstantial 

evidence but that he was not sure where it would ultimately lead.” Do 

you recall that conversation-- 

MR. HURD. No. 

MR. WALDEN. Is that accurate? Because according to this e-mail, 

you apparently knew enough to tell Mr. Perkins what evidence the 

investigation uncovered. 

MR. HURD. Well, remember just in timing wise, this e-mail would 

be posted when I knew the answer. So it went back to the meeting in 

Los Angeles, where I received here is the answer. And that meeting 

really reflected on who is your leaker. At roughly this timeframe, it 

would be logical that I would have known where the leak was coming 

from. 

MR. WALDEN. And would you have ever asked how they got that 

information? 

MR. HURD. Again-- 

MR. WALDEN. It just wasn’t-- 

MR. HURD. I want to make sure I’m clear, I should have, I should 

have. 

MR. WALDEN. I guess the thing we’re struggling with is the public 

policy issue about pretexting, you know that, but also about, in a 

corporate environment, we haven’t been able to figure out who should 

have asked this question and didn’t. And there are a lot of people who 

show up that knew about it and other--you know, Mr. Adler and Mr. Nye 

and a few of them said wait a minute, this isn’t right. 

MR. HURD. Congressman, first of all, I appreciate exactly what 

you’re saying. We have got to push this accountability further down in 
753

the company, but I don’t want to stop, I should have been able to catch it, 

I didn’t. 

MR. WALDEN. I understand. Thank you. 

MR. WHITFIELD. The gentlemen’s time is expired. 

Mr. Inslee, you are recognized for 10 minutes. 

MR. INSLEE. Thank you. You talked about when checks and 

balances break down things, really go awry. Working in the Federal 

government, I want to tell you I can empathize with that. 

MR. HURD. Congressman, I’m glad of where I am most of the time, 

maybe not today. 

MR. INSLEE. You know, there has been a lot of bright days for HP, 

and you’ve done some great work for our economy and people in 

general, and there is going to be a lot of bright days--this is not one of 

them, of course, not your finest day of this great organization. And when 

organizations go awry, like I think happened here, sometimes it makes 

sense to do a little penance and help the cause out to try to see to it that 

we reduce this from happening again in your community. Now the 

situation here in Congress is this committee, as you have heard, has 

passed a bill to give the Federal Government tools to prevent illicit 

pretexting that you have run afoul of, or the organization has run afoul 

of. 

We can’t get the Speaker of the House to schedule a vote on this bill. 

I think it might be helpful if you called the Speaker of the House this 

afternoon and suggested to him that he schedule this bill since you have 

learned that this is not a real positive thing for American corporations or 

the economy or privacy in general. What do you think of that idea? 

MR. HURD. Do you think he would take my call? 

MR. INSLEE. You bet he would take your call. And he should take 

your call because you’re a leader of a major corporation that’s a major 

technology leader. And I’m very serious about this, we need to send a 

message to the country that we’re going to stop this from happening. 

MR. HURD. Congressman, I don’t want to be trite with my comment, 

we are out in support of making pretexting illegal, creating clarity. And I 

don’t want to hide behind the lack of clarity either, because there is a 

difference between legality and ethical behavior, and we don’t want to 

confuse the two. We have a standard of business conduct that this 

violated, regardless of any clarity around legal issues. But I understand 

your point, and we’re going to take efforts to support the legislation. 

MR. INSLEE. I really do believe that can be helpful. 

MR. HURD. You have our support. 

MR. INSLEE. And I appreciate that. 

I wanted to ask you about the tracing technology and its use by HP 

and what your current corporate policy is. 
754

Mr. Adler suggested that this had been used in other contexts--as I 

understand his testimony, that it’s been used in this context of trying to 

track down a leak in Board members, but also had been used by HP 

targeting other non-HP personnel on occasion. Are you familiar with 

what other occasions that has been? 

MR. HURD. I believe that what Mr. Adler was describing about the 

use of it in other projects. We are currently going through a process right 

now to go directly at any use of a technology like that. I’m not intimate 

with that technology, several others I am. I’m not sure as we go into the 

future, we will be comfortable with the use of technology like that. It’s a 

process we’re going to review. And one of the reasons I mentioned in 

my statement our hiring of Bart Schwartz is to go through the process to 

make sure in every investigation we are behaving properly and 

appropriately as we go forward. So we will put lots of energy into this, 

Congressman. 

MR. INSLEE. Are you familiar whether or not HP has used this 

technology against other non-HP targets? 

MR. HURD. This tracer technology? Congressman, I have no 

evidence of that, I have no knowledge of us using it against a competitor 

or in any improper way, I have no knowledge of that. But as I said 

earlier, we’re going to dig in toward the bottom of everything. 

MR. INSLEE. Speaking for the 600,000 people I represent, I think 

their expectations of privacy is that a corporation would not use tracer 

technology to try to follow where they send e-mail or where they send 

attachments to report back to that corporation without their specific 

approval. That’s the expectation that my constituents have. 

Do you believe that HP should follow--and major corporations or 

minor corporations--should follow that privacy examination? 

MR. HURD. I think for us at HP, it is not important for us to follow 

but to lead. And it’s important for us to be a leader. And we have been a 

leader in consumer privacy. We are a leader in consumer privacy. This 

is an aberration to us. We need to make sure we’re checking every 

process, not just with our customers, but internally, whether it’s an 

investigation, use on our people, in any way, shape, or form to making 

sure we’re appropriately dealing with things, which we will do, 

Congressman. 

MR. INSLEE. Well, I hope do you so. And I hope that includes 

helping Congress to move forward on privacy legislation. 

I think this hearing is peeling back a layer of an onion that’s very 

disturbing, and that we need to do more work on privacy here in 

Congress. And I hope that you will put your corporate resources behind 

efforts in that regard so that others do not fall victim to this. I don’t 

believe this should be left just to the whims of the CEO of these 
755

particular corporations. We need total clarity of this situation so that no 

others have to depend on the good graces of whatever management we 

have. And I hope you would render your weight to that effort and 

become a leader on this. 

MR. HURD. Congressman, we actually believe we have been a 

leader, and that’s what is so disappointing about this. We actually 

believe we’ve been a leader to point out where consumer privacy should 

be and should go. We’ve got many people in the company that all they 

do is focus on privacy, around our products, our solutions; makes this 

even a bigger disappointment. 

MR. INSLEE. I appreciate what you’re saying, but I’m suggesting 

that--and that is a good statement--but HP’s leading legislative efforts to 

try to solve this problem is a next step that I would encourage you to 

consider. 

MR. HURD. I couldn’t agree with you more. We want to be that 

leader, Congressman. 

MR. INSLEE. Thank you. 

MR. WHITFIELD. Dr. Burgess--no, Mrs. Blackburn of Tennessee is 

recognized for 10 minutes. 

MRS. BLACKBURN. Thank you, Mr. Chairman. And I want to thank 

our witness for being here with us. 

I will tell you, quite frankly, listening to all of this today and 

spending yesterday going back through all the evidence, looking at the 

chain of e-mails, looking at the memos, it certainly provides a basis to us 

to believe that there were some folks at HP that certainly knew that they 

were pushing the envelope and they were skirting the edges. So I’ve got 

a few simple questions, and then I’m going to yield my time back. But 

Mr. Hurd, I want to know if you can tell me when was the first time you 

ever heard the term pretexting. 

MR. HURD. To the best of my memory, it was in a memo or e-mail 

that went from Larry Sonsini to Tom Perkins that was in the--I’m going 

to say in the summer--it’s in your documents, it’s got to be-- 

MRS. BLACKBURN. It’s Number 91. We know these now. We’re 

very familiar with this documentation. 

So this is the June 28th, 2006 memo. And this was the first time you 

ever heard the term pretexting? Who did you turn to to define the action 

of pretexting for you? 

MR. HURD. What transpired, if you want this background-- 

MRS. BLACKBURN. Yes, please. 

MR. HURD. Is that this resulted in a series of e-mails back and forth 

that are in your documents, where eventually not only did we uncover 

the term pretexting, but what surfaced within the next 3 weeks or so was 

a letter from a phone company that not only described the term 
756

pretexting, but described actually what happened. That trigger was the 

first specific trigger I’d had that this was wrong. 

MRS. BLACKBURN. So you were this far into the Kona project and 

the Jacob project, and you didn’t realize what pretexting was. And you 

had never, through this entire process, turned to somebody and said, tell 

me what this word pretexting is? I did not have that in vocabulary when 

I was in fifth grade or at Baylor University when I was in freshman 

English. 

MR. HURD. I don’t remember it in freshman English-- 

MRS. BLACKBURN. You would have never have heard it. I’m trying 

to figure out who you would turn to and whose advice you would ask to 

define the term and the action to know what this really was. And 

Mr. Hurd, the reason I’m doing this is not to be flippant with you, 

because I think as we live in this world where e-commerce is very much 

a part of our day and technology very much a part of our day, being 

certain that the statutes and the rules under which business operates each 

and every day and being certain that the leaders in the field, all the 

stakeholders understand is tremendously important to us. So that is why 

I had that question. 

Now, let me ask you this, also. There seems to be disagreement 

between Ms. Dunn and you as to who actually said, the buck stops with 

me, and I’m making the decision. 

MR. HURD. I will speak for no one else, that in Hewlett-Packard 

operations and strategy and everything else that goes on in HP, 

eventually the buck stops with me. 

MRS. BLACKBURN. So you’re the one responsible for ordering the 

investigation and the spyware technology, the tracer, if you will? 

MR. HURD. No, I didn’t do that. But that said, in the end, I’m 

responsible for everything that goes on at HP. 

MRS. BLACKBURN. All right. Great. 

Who actually made the decision to put the tracer-- 

MR. HURD. Well, I’m sure--I’m going to tell you what I think. My 

belief is the investigative team had a set of processes that they used. 

They were trying their best to fulfill the objectives that the Chairman had 

set forward, and that’s what they did, they went and executed around 

that. 

MRS. BLACKBURN. Who is running HP’s investigative team as of 

right now today? 

MR. HURD. As of now, we have an open position. 

MRS. BLACKBURN. An open position? 

MR. HURD. We are looking for qualified candidates, 

Congresswoman. 

MRS. BLACKBURN. Sir, I have no doubt you are. 
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Is HP investigating or using spyware on or pretexting anyone, either 

an employee, a competitor or a Board member today and at this time? 

MR. HURD. I have set up very clear instructions that any activity that 

you have described on the specifics of pretexting is to be ceased, and if 

anyone is confused they can call my extension. 

MRS. BLACKBURN. And does that apply to spyware technology 

also? 

MR. HURD. The spyware technology--I only put the caveat on it, as 

Fred described, there are a couple of dimensions to the use of this 

technology. I’m going to go back directly and make sure I look 

specifically at every use of that kind of--I think as you called it, 

send-receive technology and make sure that we have absolute clarity. 

MRS. BLACKBURN. So people that you were running pretexting 

work on or people that you were running tracers through their 

correspondence, you have ceased that at this point in time? 

MR. HURD. There is no--could you put your question one more time, 

Congresswoman, to make sure I got it right? 

MRS. BLACKBURN. Did you stop offending; did you stop the tracer 

technology, the spyware technology to pretexting? 

MR. HURD. We are stopping anything that isn’t appropriate or 

ethical in the company. What we’re looking for right now is why; we 

have got an investigation going on through the company that is still not 

complete. 

MRS. BLACKBURN. Okay, great. The Kona project briefing that has 

been referred to by my colleagues a couple of times, who actually 

prepared that? 

MR. HURD. I’m sorry. Which Kona briefing? Kona 1, 2? There 

were a multiple of the briefings. 

MRS. BLACKBURN. There is two, who prepared them? 

MR. HURD. Would have been the investigative team. But the Kona 

1 briefing, that was the one at the conclusion of it, I believe would have 

been prepared by an outside contractor. 

MRS. BLACKBURN. By an outside contractor. Have you terminated 

all of those agreements with the outside contractors? 

MR. HURD. Yes. 

MRS. BLACKBURN. And like Action--the different companies, how 

long have you had these investigative agreements with Action and some 

of these that we have in our documents? 

MR. HURD. There are two sets of contractors. There is a 

subcontractor, and then I think there are actually a series of 

subcontractors to that subcontractor that we actually would not have an 

agreement with. We would have an agreement with the original 
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subcontractor that has been terminated. I believe that the subcontractor 

in question had been working with Hewlett-Packard for roughly 8 years. 

MRS. BLACKBURN. For 8 years. All right. 

Well, Mr. Chairman, I’m going to yield back. Thank you. 

MR. WHITFIELD. Thank you, Ms. Blackburn. 

At this time, I would recognize Ms. Eshoo for 10 minutes. 

MS. ESHOO. Thank you, Mr. Chairman. And good afternoon. 

MR. HURD. Hi. 

MR. WHITFIELD. Ms. Eshoo, excuse me. Mr. Burgess has not asked 

his questions, he is a member of the subcommittee, so -- 

MS. ESHOO. Absolutely, I’ll wait. 

MR. BURGESS. I’ll yield to my friend from California. 

MR. WHITFIELD. He yields to you, so--he is such a polite fellow. So 

go ahead. 

MS. ESHOO. Thank you. Well, it’s been a long day, and I think that 

you have the advantage of being last because everyone is somewhat 

exhausted. But nonetheless, there are still, I think, some questions to be 

asked. 

Let me just comment first that--and I’ve said this with each group 

that has come in. For me, this is a sad day, I think it is for you as well. I 

keep thinking of the thousands of employees who no doubt have tried to 

access this at some point during the day on C-SPAN, so many of them 

are my constituents. They have worked hard to not only help make the 

company successful, they have a real investment in it, a great sense of 

pride, and I share that with them, and I think that you do as well. 

This really needs to be cleared up. I don’t think there can be 

anything that’s lingering at the end of this. And I hope that there isn’t, 

because it’s something that needs to be thorough. The sunshine is really 

a disinfectant, I believe. One of our members, the distinguished Ranking 

Member of the full committee, uses that phrase a great deal, and that’s 

what this process is about. 

You’re one of the survivors of the key people in this. Very 

distinguished General Counsel is gone, distinguished Chairwoman of the 

Board, gone. Mr. Hunsaker, the ethics officer of the company, gone. 

Mr. Gentilucci--I cannot remember his exact title, you know what it is--

gone. And so I think with the individuals that are here, even Ms. Dunn 

did testify during the longest stretch of today’s hearing, there are gaps, 

there are still a lot of gaps. 

Now I asked Mr. Adler, whom I don’t know, either couldn’t hear me 

or hasn’t worked at HP long enough to have an institutional history of 

how HP is operated, so let me start with the questions that I asked him. 

How long has HP had a contract or retainer or retained SOS, ARG 

and the other outfit, Eye in the Sky I think is the name of it? 
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MR. HURD. The contract relationship, as I mentioned, was roughly 

around 8 years. 

MS. ESHOO. And was it mostly with SOS, or all three? 

MR. HURD. That’s my understanding. 

MS. ESHOO. Do you still have a contract with them? Are they still 

on retainer? 

MR. HURD. No. 

MS. ESHOO. Are you going to have any contract with outside 

investigators? Your answer is probably going to be no, given this 

experience. 

MR. HURD. I think what we’re going to do is get the best in class 

processes, Congresswoman, to make sure we understand how 

investigations, if they need to be done, are done, so they meet the level of 

our ethical standard as well as our-- 

MS. ESHOO. What did they do for 8 years ? 

MR. HURD. I don’t know, Congresswoman, they did many 

investigations over that period of time. 

MS. ESHOO. In reading the background and preparing for this 

hearing, one of the breakdowns was the use of Social Security numbers. 

That’s a huge violation, I have to tell you, in my view, which really goes 

after someone’s privacy. You have a Social Security number, first of all 

you’re holding gold, you’re holding gold. Someone filed a fraudulent 

tax return in my name, and it was because they somehow got my Social 

Security number. So Social Security numbers are really the golden key 

that can open the door so that people can get a lot. 

Can you explain to us from your investigation of the investigation 

how many Social Security numbers were used from inside the company 

to access information? 

MR. HURD. I do not yet have a complete report on how many. 

Clearly there have been an effort to gather at least a couple that I’ve 

seen, which we’re still not to the end of the trail. So certainly there have 

been a couple. And as I pledged to you earlier, we will dig to the bottom 

of it. 

MS. ESHOO. Mr. Chairman, is that going to be requested as part of 

the record for this hearing? 

MR. WHITFIELD. Would you repeat that question? 

MS. ESHOO. I was asking Mr. Hurd about the--no one brought this 

up today--but part of what I’ve read is that Social Security numbers were 

used internally in HP in order to obviously go out and secure 

information. So Mr. Hurd doesn’t know from the investigation into the 

investigation what the answer to my question is, and I asked if that would 

be requested from the committee to be made part of the record. I think it 

is an important part of it. 
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MR. WHITFIELD. Absolutely. Without objection, yes. 

MS. ESHOO. Let me ask you this; does the Chair of the Board have 

the authority to initiate activities and to commit company resources? 

MR. HURD. That’s one of those issues of governance. I mean, you 

get down to the fact that the Chairman of the Board certainly can commit 

company resources, depending on the interpretation of what resources 

are being committed. 

MS. ESHOO. Did Pattie Dunn commit HP resources for this 

investigation? 

MR. HURD. The best thing I can tell you, Congresswoman, is the 

second phase, being Kona 2, which is when I was in place. Pattie did 

not. Pattie asked me if she could now engage with HP resource, which 

she-- 

MS. ESHOO. So there isn’t a firewall there. The description of the 

Chair of the Board as it applies to HP seems to be just a little different. 

There are other models that are the same, but I think there are others that 

are more common to one another than what was described today. 

But when you said Pattie took it seriously, I have to tell you that that 

sounded to me as if there was one person that took it seriously and went 

out on their own to do this. And I have to tell you--this is just the way it 

struck me -- 

MR. HURD. Can I clarify that? 

MS. ESHOO. Pattie took it seriously. It seems to me that there were 

several members of your Board that took it seriously. 

MR. HURD. If I said it that way, I mischaracterized it. This was a 

very serious issue. Leaks coming out of the company about strategy, 

about operations -- 

MS. ESHOO. I think so. 

MR. HURD. This is a very serious issue. And I want to make sure 

I’m clear to everyone, it’s unacceptable, it’s unacceptable at 

Hewlett-Packard. We can’t have that and run a company successfully. 

So I want to say one more time, Pattie appropriately took it seriously. I 

was only trying to make a comment relative to the abrogation of 

priorities in the company relative to what’s gone on across all of 

Hewlett-Packard. It wasn’t my personal number one priority relative to 

other things, but don’t take anything away to diminish the importance of 

it. 

MS. ESHOO. To whom does the ethics officer report to? 

MR. HURD. The ethics officer reports to our total customer 

experience group, which is in our marketing organization. 

MS. ESHOO. Are you going to change that? 

MR. HURD. We’re going to look at the entire process, 

Congresswoman, that’s what I pledge to you. 
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MS. ESHOO. You know what I’m stuck by? And we’re all 

somewhat guilty of this, but I am certainly reminded of it over and over 

and over again today. It doesn’t seem to me that human beings sit down 

and talk to each other anymore. People are messaging and texting and 

we don’t remember meetings and we’re buzzing and we’re wired, and 

there is all of this information that’s going out there. No one remembers 

it. It’s not used for anything. And look what’s happened. I always want 

to look ahead, that we learn from the mistakes that we make, we’re all 

human, it’s the mark of our humanity. And my mother used to say, little 

people make little mistakes, big people make big mistakes, and there are 

big mistakes in this. 

But I think when you reshape all of this, that given the reputation 

that HP has had, enjoyed, earned, that an ethics officer report to the CEO 

is just a suggestion of mine. 

Where did the progress reports of the investigation go to? Were they 

shared, did they just go to one person? 

MR. HURD. Are you talking on a go-forward basis, 

Congresswoman? 

MS. ESHOO. No, what you’re here for today, the investigation. 

Where did the progress reports on this go to? 

MR. HURD. Where did they go? 

MS. ESHOO. Yes. There were the investigators, outside, inside, they 

weren’t just given instructions about what to do and then come up with a 

report, they must have had progress reports. Where are those progress 

reports? 

MR. HURD. I want to make sure I’m clear, you’re talking about the 

actual investigation themselves? 

MS. ESHOO. Kona 2. 

MR. HURD. There were some updates that went through the 

investigative team, and I’m not aware of them escalating beyond that. 

MS. ESHOO. So it stayed in the same circle? 

MR. HURD. That is, to the best of my knowledge, what transpired. 

MR. WHITFIELD. The gentlelady’s time has expired. 

Dr. Burgess is recognized for 11 minutes for being such a great-- 

MR. BURGESS. Mr. Chairman, just for the record, we have heard 

about our bill that has passed out of committee that has not been heard on 

the floor, but I do want to draw the committee’s attention to the fact that 

we did pass on the House floor H.R. 4709, the Telephone Records and 

Privacy Protection Act, that was a bill of Lamar Smith’s out of the 

Judiciary Committee. And since it was out of the Judiciary Committee, 

it probably wasn’t as good a bill as ours was, but I did want to point out 

that the House has acted on this concept, trying to provide that context 

and that bright line that several people have asked for. Now I know the 
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Senate has not done so, and perhaps when the conference is held we can 

actually conference both bills with whatever the Senate produces for us. 

Mr. Hurd, in your written testimony you say that you don’t recall 

seeing or approving the use of tracer technology. I guess of all the stuff 

we’ve heard, the tracer software or spyware, whatever it’s called, is 

really the thing that is most disturbing to me. And you state that you 

don’t recall seeing or approving the use of the tracer technology. What 

was the purpose then, how did you think this elaborate structure around 

the e-mail of the fictitious Jacob, how is it all supposed to work? 

MR. HURD. Sir, first, you’re correct, that’s the best of my 

knowledge. But certainly, the objective of it was get whoever it was that 

was leaking company information to call back into the company to 

validate that whatever information in that e-mail was accurate. 

MR. BURGESS. Let’s see. I think it is Tab 62 in the big book, we 

have an e-mail exchange. And of course, I have trouble with e-mail 

exchanges, you always have to start at the end and then work up. But 

basically, the e-mail exchange gives the fake e-mail or a draft of the fake 

e-mail that will be sent to Dawn, and it seems like rather innocuous 

information, but anyway, it goes right up the chain to you. Now, it’s 

your testimony, then, that you didn’t know that the tracer software was 

going to be attached to this e-mail, this-- 

MR. HURD. To the best of my memory, I don’t remember that. 

MR. BURGESS. And I, of course, don’t run a large electronics 

corporation, so this information seems relatively innocuous, it’s hard to 

see how the information itself would provide a traceable event for you, 

but that’s your contention, that someone would call back in about the 

next generation data centers? 

MR. HURD. Oh, sure, that once that information was to get in the 

hands of whoever it was that was interested in leaking information, they 

would have to validate that the information was correct and talk to 

somebody who would be responsible for that. I think that’s what the 

team’s objective was. 

MR. BURGESS. Well, it seems like the team--everyone else on the 

team knew about the tracer aspect, but you did not? 

MR. HURD. I just don’t remember, Congressman. 

MR. BURGESS. Okay. In a public statement last Friday you stated 

you attended a meeting in July 2005 where Kona 1 was discussed, where 

a verbal summary of the second phase of the investigation was provided, 

the second phase of the operation being the tracer software or the fake 

e-mail? 

MR. HURD. Okay. I think let’s go back to the two investigations. 

What you described are the two phases. The Kona 2 phase is where this 

e-mail actually occurs. Kona 1 was that first piece that actually didn’t 
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even use this investigative team, it was a separate team. And that 

meeting you’re describing, I believe, was a report of their lack of a 

finding of any type, in that meeting where none of that was actually 

involved. 

MR. BURGESS. In the July meeting, were you present for the 

discussion--any discussion of phone records? 

MR. HURD. I don’t remember a discussion about that, Congressman. 

I wasn’t in that meeting all that long, as I commented earlier. 

MR. BURGESS. Let me ask you this; you attended the May 18, 2006, 

Board meeting; Mr. Perkins resigned. 

MR. HURD. Yes. 

MR. BURGESS. Mr. Perkins has been outspoken that he resigned in 

protest over the tactics that were used in the leak investigation. Did the 

company insist--did you insist that the form 8K filed by Hewlett-Packard 

announcing his resignation fully disclose the reasons for his resignation? 

MR. HURD. Congressman, we always to want file an 8K that was 

appropriate and accurate and complete; so that’s my first response. 

Secondly, I clearly remember Tom’s reaction to what had transpired. 

He was bothered by the way the meeting occurred and the way the 

meeting was going on, and he clearly made that very clear in his 

discussion as he departed. 

Subsequent to Tom’s departure, physical departure from the Board 

meeting, he actually had a phone conversation with Mr. Sonsini, who 

you heard from earlier. I was not party to that phone conversation with 

Mr. Sonsini. So the 8K itself reflects both what occurred in the meeting 

and the conclusions of the phone conversation between Mr. Perkins and 

Mr. Sonsini. 

MR. BURGESS. Do you think that is an adequate--does that cover the 

explanation or is that an adequate explanation for Exhibit 92 that 

Mr. Perkins wrote to the Board? It seems just from the tenor of his letter 

that he’s disturbed that there is not a complete disclosure of the activities 

that led to his resignation. 

MR. HURD. So clearly there is a debate, I accept your point. The 8K 

was filed based on the data that I described, the two pieces of data that I 

described, what actually occurred in the Boardroom and the follow-up 

conversation between the two. To the best of my knowledge, 

Congressman, our 8K reflects both what happened in the Boardroom--

and for that one, Congressman, I was there. I was not at the conversation 

between Mr. Sonsini and Mr. Perkins. So the combination of the two are 

a submission of the 8K. I understand the debate that occurred, 

subsequent to the debate that you see here represented in the documents. 

Tom also asked that we look into this deeper, into the investigative 

methods. That debate was occurring, as you can see by the documents, 
764

into late July. We subsequently started the investigation upon some of 

the evidence that Tom was describing, which led to what has transpired. 

So that is really how the flow worked, Congressman. 

MR. BURGESS. It’s been a long day. Exhibit 96, in response to your 

company-wide e-mail on August 23rd concerning standards of business 

conduct, one of the Kona investigators, Vincent Nye, comments, and I 

quote, “This investigation will be a defining case which will test the 

company’s claim of having uncompromising integrity.” I think we will 

both agree it has certainly done that. Do you feel that going forward you 

can restore Hewlett-Packard’s integrity? 

MR. HURD. Congressman, I will. 

MR. BURGESS. What have you done through this process to keep the 

employees of your company informed of what has happened, and that the 

progress of not just this hearing today, but your internal investigations at 

Hewlett-Packard and what legal liabilities there may be? 

MR. HURD. Well, we’ve made an effort to communicate with them 

as often as possible. We’ve communicated with them about our changes 

in governance, the issues around the investigation. I’ve been 

communicating to them frequently. I’ll also communicate to them as 

soon as I return. 

Our employees are great people, Congressman. And I’m not here to 

give you a commercial on HP, but I believe this to my core. The people 

of Hewlett-Packard are some of the most hard working, highest level of 

integrity people around, and we’re going to get this right. 

MR. BURGESS. And I sincerely hope that you do because as I 

pointed out earlier, 57,000 American jobs, nearly 10,000 of my home 

State of Texas and almost 200 in the District that I represent in north 

Texas, so it is personally important to me as well, and I do sincerely hope 

you are correct. 

Can you just answer me this in the 5 minutes or so that I have 

remaining; how do you feel that this affects the country’s perception of 

corporate America? Have we harmed the corporate image in general? 

MR. HURD. It’s hard for me to imagine it’s been helpful, but I can 

tell you this, that one of our founders, Dave Packard, said--who is quoted 

quite a bit around corporate America and certainly around our company--

there will never be a time that we don’t make mistakes. And I guarantee 

you, Congressman, we’ll make more. The defining point will be what 

we do about them, how we handle them and refine ourselves as we go 

forward in the future. And I promise you we are committed to our core 

to redefine our company in a way that not only we can be proud of, but 

that all corporate America can be proud of. 
765

MR. BURGESS. Well, on behalf of your employees, your 

stockholders and the country at large, I sincerely hope you are correct. 

Thank you very much for your attendance at this long hearing. 

Mr. Chairman, I will yield back the balance of my time. 

MR. WHITFIELD. Well, thank you. 

You know, today’s hearing has focused, correctly so, in my view, on 

significant shortcomings at Hewlett-Packard that did involve activity that 

violated private rights of individuals, that possibly violated the law, and 

certainly violated the ethics of Hewlett-Packard. 

But in departing, there is one bright spot that I would like to just 

point out once again, and I’m sure you’re familiar with this. Back as far 

away as last February of 2006, Mr. Vince Nye, whom I’ve never met, 

wrote an e-mail--sent an e-mail to Kevin Hunsaker, and he says, “Tony, I 

have serious reservations about what we’re doing. As I understand the 

methodology in obtaining this phone record information, it leaves me 

with the opinion that it is unethical at the least, and probably illegal. If it 

is not totally illegal, then it is leaving Hewlett-Packard in a position that 

could damage our reputation, or worse, and I am requesting that we cease 

this phone number gathering immediately and discount any of its 

information. I think we need to refocus our strategy and proceed on the 

high ground.” And I think that’s an employee of Hewlett-Packard that 

needs some sort of recognition--maybe give him the day off or 

something. 

But with that, thank you for being with us today. And I know it’s 

been a long day, we appreciate your testimony very much. And we have 

the greatest confidence that you will continue to lead Hewlett-Packard 

back to its standing and succeed in every way. With that, the hearing is--

and the record will remain open for 30 days. And with that, the hearing 

is adjourned. 

[Whereupon, at 5:34 p.m., the subcommittee was adjourned.] 
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RESPONSE FOR THE RECORD OF MARK HURD, PRESIDENT, CHIEF EXECUTIVE OFFICER, AND 

CHAIRMAN OF THE BOARD, HEWLETT PACKARD COMPANY
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