The Year In Review

If there were a textbook on how not to conduct an internal investigation, Hewlett Packard Co. would be on the cover. Its 2006 investigation into the source of boardroom leaks to the media was plagued by a host of serious missteps, questionable ethics decisions and possibly illegal conduct that have severely tainted the company's image.

But rather than deliberate malfeasance, HP 's pretexting scandal seemed to arise from corporate sloppiness and a severe lack of oversight by those at the top of the organization, including HP 's long-time general counsel, Ann Baskins, who resigned Sept. 28 amid media coverage of the scandal. Judging from e-mails the investigation team sent to each other, Baskins was in the dark about the nature and extent of the tactics the investigators were using--including assuming false identities to gain access to the phone records of HP employees, journalists and a board member suspected as the source of the media leaks. One investigator described the investigation as "don't ask, don't tell." Another wrote, "I doubt [Ann] knows the exact mechanics of this." Although Baskins had ultimate responsibility for overseeing the probe and assuring the company complied with the law, she managed to evade the flurry of indictments that came down in October, leading some to speculate that she's cooperating with the government and may testify in the criminal trial against former HP Chairwoman Patricia Dunn.

"I strongly suspect [that prosecutors] will use her as a witness at Dunn's trial," said Peter J. Henning, a white-collar crime professor at Wayne State University and author of the White Collar Crime Prof Blog, in an October interview with InsideCounsel. "Baskins' lawyer will demand immunity for her if she testifies." But immunity from criminal prosecution is likely cool comfort for Baskins, who spent 24 years--almost the entirety of her legal career--working for HP .

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Technology Editor

Keith Ecker

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