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HP Pays $14.5M to Make Civil Charges Disappear

CowboyNeal posted more than 7 years ago | from the throwing-money-at-the-problem dept.

HP 107

theodp writes "The California Attorney General's Office negotiated a $14.5 million payoff from HP as part of a settlement that calls for the state not to pursue civil charges related to the now infamous spy scandal against the company and its current or former officers or directors (felony criminal charges against five individuals still remain). HP also agreed to maintain the watchdog positions of chief ethics officer and chief privacy officer for five years."

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107 comments

Corruption (5, Funny)

heneganj (786136) | more than 7 years ago | (#17160316)

And I thought corruption only occurred on HP CD burners.

Re:Corruption (1)

Glonoinha (587375) | more than 7 years ago | (#17160910)

That's the thing about California - they have the best government money can buy.

Settlement is common in civil cases! (5, Interesting)

denebian devil (944045) | more than 7 years ago | (#17161228)

The summary is very misleading in the way that it describes HP as paying money to make the case disappear. This wasn't a criminal case where they were buying off a judge to rule favorably. This was a civil matter. and 99 times out of 100, civil matters are about one thing: money. They can either pay money in the settlement, pay money as a result of a judgment from a trial, be dismissed through a motion, or be found not guilty from a trial. Settlement is COMMON, because it allows both sides to save costs from not having to pay for a costly trial. And trials are MUCH more costly than most of what happens pre-trial.

This isn't some back-alley dealing, it's one legitimate and often used method of resolving civil disputes quickly and cost-effectively. And on top of that, it means that HP can't appeal the decision because they agreed to it. If the case had gone to trial and verdict and resulted in a decision HP didn't like, they could have appealed and kept the case going for years without resolution, while at the same time increasing both their costs and the costs of the state in trying the case.

Re:Settlement is common in civil cases! (1)

ari_j (90255) | more than 7 years ago | (#17161354)

Other than saying "not guilty," which are words that only apply to a criminal case, you are spot-on. I am really irritated by the article summary here. HP didn't negotiate a "payoff," it didn't "make ... charges disappear," and so forth. It settled a lawsuit, and it settled for a substantial sum of money. There's nothing illicit about this at all.

Re:Settlement is common in civil cases! (1)

Billosaur (927319) | more than 7 years ago | (#17161438)

The summary is very misleading in the way that it describes HP as paying money to make the case disappear. This wasn't a criminal case where they were buying off a judge to rule favorably. This was a civil matter. and 99 times out of 100, civil matters are about one thing: money. They can either pay money in the settlement, pay money as a result of a judgment from a trial, be dismissed through a motion, or be found not guilty from a trial. Settlement is COMMON, because it allows both sides to save costs from not having to pay for a costly trial. And trials are MUCH more costly than most of what happens pre-trial.

And the upshot for the State of California is that that a) they don't have to waste money pursuing the suit and b) they now have some cash to help pay off their staggering deficit. Normally I'd say put HP's feet to the fire, but I think here the Governator is being pragmatic and actually doing something to help his state in the long run.

Re:Settlement is common in civil cases! (1)

DragonWriter (970822) | more than 7 years ago | (#17163952)

Normally I'd say put HP's feet to the fire, but I think here the Governator is being pragmatic and actually doing something to help his state in the long run.


You mean Attorney-General Bill Lockyer, the independently-elected statewide Constitutional officer responsible for the settlement, who isn't even from the same party as the "Governator", right?

Re:Settlement is common in civil cases! (1)

idontgno (624372) | more than 7 years ago | (#17161482)

This isn't some back-alley dealing,

Settling without an admission of guilt is back-alley dealing, no matter how common it might be in civil litigation. (And I'm not fond of nolo contendere in criminal law, either.)

For the public good and the purposes of justice, guilt is as important as imposition of a penalty. The harm done has to be, in old theological terms, publicly "repented". The attachment of a designation of guilt makes it unarguably clear that the perpetrator understands it's got some reforming to do.

In this case? HP did nothing wrong, just ask 'em. $14m is chump change. Less than chump change. The board and the executives could hold a bake sale to raise that. And the other outcome? Two shiny new executive seats to fill. Darn. Two more opportunities to promote apple-polishers.

I vowed, long ago, to never buy HP. This reinforces my determination.

From an engineering firm with great public and professional ethics to just another cut-throat robber-baron vendor of inferior-grade cruft. How far indeed have the mighty and righteous fallen.

Re:Settlement is common in civil cases! (1)

nomadic (141991) | more than 7 years ago | (#17162022)

In this case? HP did nothing wrong, just ask 'em.

What are you talking about? They very publicly apologized through multiple press releases, they fired several of their executives, and agreed to an injunction (which is definitely losing from a legal standpoint). There's no dispute on anyone's part, even HP's, that they definitely did something very wrong.

Re:Settlement is common in civil cases! (1)

idontgno (624372) | more than 7 years ago | (#17163960)

Ah, you're talking in a PR sense. I meant in a legal sense, the only sense that matters to corporate overlords.

A more precise formulation is "HP did nothing illegal, just ask 'em." And if legislative developments continue as they seem to be shaping up, future instances of this behavior will continue to be legal, just ask 'em.

Re:Settlement is common in civil cases! (1)

nomadic (141991) | more than 7 years ago | (#17166854)

Ah, you're talking in a PR sense. I meant in a legal sense, the only sense that matters to corporate overlords.

You don't think PR matters IMMENSELY to corporate overlords? HP is taking a very public hit on this, and the settlement agreement is quite public as we can all see.

But I dunno, I'm a lawyer so maybe I have a skewed view of it; I don't see having a judgment against you that big a deal. Civil wrongs aren't crimes, and every large company is going to have plenty of judgments against it on the record.

Re:Settlement is common in civil cases! (0)

Anonymous Coward | more than 7 years ago | (#17169958)

You're an attorney but you don't see how the successful prosecution of this case could have set some very useful legal precedent for those who value privacy? Maybe you mean lawyer like you play one on TV?

Re:Settlement is common in civil cases! (1)

ShieldW0lf (601553) | more than 7 years ago | (#17164110)

Ever heard of the old saying "An Eye for an Eye"?

It was an idea put forth during the time of waring families, and it was intended to see to it that if you tore out the eye of the son of your enemy, your own son would have his eye torn out, not to punish your son, but to make sure there was no advantage to be had by violating the social order.

HP engaged in covert espionage. Who knows what they found out?

There shouldn't be any money paid to the government here.

HP should have their entire communications structure made public knowledge, with the exercise conducted by a third party, appointed by a panel of their competitors, with the whole thing funded by HP as punishment.

This would be fitting, and exposing the inner workings of the company to public scrutiny would be conductive to the public good, and you can bet your last dollar no other company would want to be caught dead engaging in this sort of excercise in the future.

Re:Settlement is common in civil cases! (1)

Some_Llama (763766) | more than 7 years ago | (#17165884)

"It was an idea put forth during the time of waring families....no advantage to be had by violating the social order."

More accurately it was one of the laws given by God to the israelites. A pattern for ultimate justice in those times:
Exodus 21:23-27
"[23] And if any mischief follow, then thou shalt give life for life,
[24] Eye for eye, tooth for tooth, hand for hand, foot for foot,
[25] Burning for burning, wound for wound, stripe for stripe.
[26] And if a man smite the eye of his servant, or the eye of his maid, that it perish; he shall let him go free for his eye's sake.
[27] And if he smite out his manservant's tooth, or his maidservant's tooth; he shall let him go free for his tooth's sake."

Re:Settlement is common in civil cases! (1)

ShieldW0lf (601553) | more than 7 years ago | (#17168444)

No, it was an idea with a specific type of social merit that was propagated to the masses through religion.

The chicken or egg question of "was this particular idea chosen for this religion based on this social merit" or "did this religion survive where others failed based on their co-incidental adoptation of this social value" is something for historians to answer.

All the religions are full of this type of stuff, looks like mumbo-jibberish that you accept as part of a religion and rationalize away as metaphors for underlying truths like we're taught to do, when it point of fact it was simply literal-minded good advice that is only good advice when you consider it in the context of how the world was when it was written.

That's the problem with leading the stupid to wisdom with religion, they didn't know why it was wisdom when they started listening, so they don't know when it stops being wise to listen....

Re:Settlement is common in civil cases! (1)

emc (19333) | more than 7 years ago | (#17166430)

Agreed.

This whole thing just cost HP a little under 100 minutes of revenue, based upon their prior years revenue of nearly 92 billion dollars.

They got off easy. This will set a precedent for any criminal process in this issue.

Re:Settlement is common in civil cases! (2, Insightful)

timeOday (582209) | more than 7 years ago | (#17161550)

This was a civil matter. and 99 times out of 100, civil matters are about one thing: money.
And I guess the responsible executives at HP will be personally responsible and pay from their own pockets, right? I mean, they make millions of dollars because they're practically gods walking the earth, so on the rare occasion they do fall short of perfection, I suppose they'd be the first to bear the consequence of their own personal choices.

Re:Settlement is common in civil cases! (1)

jahudabudy (714731) | more than 7 years ago | (#17162424)

If individual executives cost HP $14.5 million, and are not punished by the board (either financially, or career-wise), then the shareholders need to get a new board. I'm not saying this is likely to happen (good old apathy), but it is the process by which the individuals should be punished: HP representatives piss off the state on behalf of HP, the state punishes HP, HP punishes the individuals that represented it.

Re:Settlement is common in civil cases! (1)

Fnkmaster (89084) | more than 7 years ago | (#17167636)

And if you write a line of code that doesn't do what it's supposed to and it costs your employer $2M by the loss of a big client who's system crashes unexpectedly on them, you're going to pay that out of your pocket, right? Because it would only be fair.

Face it, that's not the way the world works. Corporations are a limited liability entity to shield individuals from this kind of financial ruin.

If you screw up and it costs your employer millions of dollars, you should expect to be out of a job and to have trouble getting a new job.

I know, people will point to big screw ups like Carly Fiorina who was basically paid off to leave after screwing up her company completely (which just happens to be HP) as an example of how top execs don't have to play by the same rules. But the point is nobody will take a job with compensation that is completely contingent - i.e. you have to return us the last 3 years of your salary if you screw up at some point. As it is, a substantial portion of a top exec's comp is usually performance-contingent, i.e options, performance bonus, etc. And it's often hard to attribute blame for bad outcomes entirely to a CEO, vs. external, economic, competitive and other factors, which is what leads to the inevitable lawsuits and settlement payments.

Re:Settlement is common in civil cases! (1)

AnotherHiggins (925608) | more than 7 years ago | (#17163186)

FTFA:
But the PC maker said that as part of the deal, the state will not pursue civil charges against the company, or against its current or former officers or directors.

So these crooked corporate executives make the decision to have their company settle out of court. That is, as you pointed out, quite common for civil cases.

But as part of the deal (which, again, involves the company paying money), those same corporate executives now avoid personal civil charges. That doesn't seem right. They are getting off scot-free (on the civil charges, anyway).

To recap: They, being in charge, have decided that their company - from which they may well be dismissed for wrongdoing - will bail them out.

Re:Settlement is common in civil cases! (1)

NormalVisual (565491) | more than 7 years ago | (#17163828)

I'd doubt there's anything in the settlement that precludes the shareholders themselves from taking action against the responsible parties, so I don't think they're quite off the hook yet. I very much agree with your underlying point that the corporate veil enables people to avoid bearing responsibility for their actions in a great many cases though.

Re:Settlement is common in civil cases! (1)

Osiris Ani (230116) | more than 7 years ago | (#17166578)

So these crooked corporate executives make the decision to have their company settle out of court.

I find it amusing that you quoted the article but somehow managed to neglect this, also from the article: "The case is separate from the felony criminal charges [com.com] that have been brought against five individuals."

Also bear in mind that the executive most responsible, chairman Patricia Dunn, is now a former employee, and is one of the five currently under indictment for the four alleged felony counts — fraudulent wire communications, wrongful use of computer data, identity theft, and conspiracy to commit those three crimes. Each of those charges carries a maximum potential prison sentence of three years, and I don't believe that any of the defendants are actually immune from civil litigation.

So much for "getting off scot-free."

Re:Settlement is common in civil cases! (1)

mspohr (589790) | more than 7 years ago | (#17166138)

It should also be noted that this payment for the civil case does not make the criminal charges against the HP board members go away. They are still facing criminal charges.

Re:Settlement is common in civil cases! (1)

Osiris Ani (230116) | more than 7 years ago | (#17166676)

criminal charges against the HP board members

Aside from former HP chairman Patricia Dunn, the other four charged [com.com] were actually Kevin T. Hunsaker, HP's former senior lawyer; Ronald DeLia, a private detective; Matthew DePante, of data-brokering company Action Research Group; and Bryan Wagner, a Colorado man believed to have been an employee of Action Research. Not much from the board per se, but the charges seem to cover the responsible parties.

Re:Settlement is common in civil cases! (0)

Anonymous Coward | more than 7 years ago | (#17169210)

This isn't some back-alley dealing

Actually, it is some back-alley dealing because the state's Attorney Generals' office has decided to use the money to fund anti-piracy litigation and not just pro-privacy litigation. You can't get more back alley than using funds earned due to privacy violations to fund what is almost always a matter of privacy violation (stopping people from using what they bought the way they want in the privacy of their own home). The California AG's office is, it appears, as corrupt as HP.

A more fashionable solution! (0)

no-body (127863) | more than 7 years ago | (#17160344)

Nowadays, when breaking the law, a company-supplied penalty is paid and case closed.


"Normal" people go to jail.....

Re:A more fashionable solution! (5, Informative)

Anonymous Coward | more than 7 years ago | (#17160372)

Nowadays, when breaking the law, a company-supplied penalty is paid and case closed.

"Normal" people go to jail.....


Sigh, could you not even bother to read the summary properly? What part of "felony criminal charges against five individuals still remain" do you find difficult to grasp?

HP is in the clear though (1, Informative)

Anonymous Coward | more than 7 years ago | (#17160654)

and that is the point.

HP is not in the clear... (1)

DragonWriter (970822) | more than 7 years ago | (#17164210)

...any more than they were before; they were never criminally charged, they were civilly charged, which meant, if they lost, they would pay a fine. By settling, they paid a fine and were subject to specific conduct controls.

HP surrendered, they didn't get away.

Re:A more fashionable solution! (4, Insightful)

Whiney Mac Fanboy (963289) | more than 7 years ago | (#17160404)

Such are the consequences of giving human rights to corporations.

Re:A more fashionable solution! (4, Interesting)

inviolet (797804) | more than 7 years ago | (#17161516)

Such are the consequences of giving human rights to corporations.

No, it's not. It's a consequence of the corporate veil [wikipedia.org] and the general unwillingness to pierce it. The veil is considered sacred because it empowers the members of a corporation to take risky, productive steps in the face of possible backlash -- be it legal or financial.

The veil is further justifiable by realizing that corporations encourage sociopathic groupthink, by their very nature... and so their members are (to some degree) excused for doing so. I say "to some degree" because as the felony charges in this case demonstrate, members are not excused for the serious stuff.

Another way to look at it is to state the issue in your terms: the veil is the way that a corporation's members pool their human right to free association. The veil essentially announces to the world "If you wish to associate with any of our number, then you do agree to do so by treating us as collective and unseverable". The law gives force to this agreement by standardization, and this results in efficiency gains all around.

Of course it also results in sociopathic behavior... but that is a cost and it usually compares favorably to the yield.

Re:A more fashionable solution! (0)

Anonymous Coward | more than 7 years ago | (#17166124)

You say that as if you think personal accountability is a BAD thing!

Re:A more fashionable solution! (5, Informative)

Christianson (1036710) | more than 7 years ago | (#17160414)

Nowadays, when breaking the law, a company-supplied penalty is paid and case closed.

"Normal" people go to jail.....

People still might. The AG isn't waiving rights to press criminal charges against indiviuals, and in fact is pressing ahead with at least five cases, including against Dunn.

This actually doesn't seem like a terrible thing to me. A civil case against HP would be an enormous burden on the state of California, drag on for years, and by the virtue of the sheer size of HP, be unlikely to result in anything more than a wrist-slap. This settlement gets HP to admit to wrongdoing, puts some measures in place (pathetic though they may be) to try and keep them from doing it again, and not only saves the state money, but gives them a warchest to go after the real villains in this case: the executives who felt that the shield of incorporation gave them the right to condone and engage in unethical behaviour.

Re:A more fashionable solution! (-1, Troll)

freedom_india (780002) | more than 7 years ago | (#17160578)

>>but gives them a warchest to go after the real villains in this case

How naive you are ! That money is already spent. How do you think California will reduce its gaping Budget Deficit?

Its like a proverbial drop in the Ocean.

Lee Iacocca said the same thing to US Gov. when he repaid Chrysler's loan to them. He advised them to establish a Research Center for Autos for fuel efficiency, etc.
Did they listen? Nope. It went to fund the starwars program.

If any private company is run like a Govt. Office, the executives would be in jail.
The Katrina payouts, the overpaid toliet seats, the double dipping by HAlliburton, etc., these are criminal wastages of OUR money.

I mean if we are shareholders of the Govt., we would have long launched a Class Action Suit, which would have resulted in convictions for atleast the CEO, CFO, etc.

Every year the Govt. Accountability Office publishes a scathing report about the wastages of our money against almost every dept.

Yet what happens??? NOTHING.

Re:A more fashionable solution! (4, Insightful)

Luscious868 (679143) | more than 7 years ago | (#17160768)

This settlement gets HP to admit to wrongdoing, puts some measures in place (pathetic though they may be) to try and keep them from doing it again, and not only saves the state money, but gives them a warchest to go after the real villains in this case: the executives who felt that the shield of incorporation gave them the right to condone and engage in unethical behavior.

No, they engaged in illegal behavior. Not everything that is unethical is illegal. See our current political system and the campaign finance system that supports it. Tell me what is ethical about the fact that elected Senators and Congressman don't even bother to read most of the bills they vote on. They don't even write the bills anymore, their staffers do. You know, the same staffers who will eventually leave to take high paying jobs with lobbying firms after paying their dues writing bills that are friendly to the interest those lobbyist represent. Completely unethical, 100% legal.

In fact, I wouldn't be at all surprised to see most of these five individuals get what amounts to a slap on the wrist after a large donation or two is made to the proper re-election campaign committees or PACs. Sure one of them will have the book thrown at them so it appears action is being taken. Probably the lowest person on the totem pole. Then, after the smoke clears from that conviction suddenly the state will find no compelling reason to drag these remaining cases out. The poor defendants will have been put through enough. A small fine and 6 months probation will suddenly be more than enough punishment. After all, their names will have already been drug through the mud. That punishment alone will have done more damage than anything they state could do. They will have learned their lessons. I can see it now. What a joke.

Re:A more fashionable solution! (1)

Dr. Eggman (932300) | more than 7 years ago | (#17160550)

The problem is two-fold, its not just that corporations have so much money but also the courts really need money. The judicial system is very expensive to run, if they can save the costs of an enitre trial and just get a wad of cash from the corporations, they're going to try and get it. We can reduce the problem by funding the courts better.

Nothing to see here! (-1, Flamebait)

RevMike (632002) | more than 7 years ago | (#17160720)

Nowadays, when breaking the law, a company-supplied penalty is paid and case closed.

"Normal" people go to jail.....

Nowadays, when something like this is in the news, Slashdot posters demonstrate that they don't know the difference between civil and criminal charges.

Re:A more fashionable solution! (1)

value_added (719364) | more than 7 years ago | (#17160786)

"Normal" people go to jail.....

Here's a hint. TFA refers to a civil case. Criminal cases are treated separately, sort of like winning a divorce case doesn't mean you get the kids; typically, you have to slug it all over again in a custody case.

Criminal law (also known as penal law) is the body of statutory and common law that deals with crime and the legal punishment of criminal offenses. There are four theories of criminal justice: punishment, deterrence, incapacitation, and rehabilitation. It is believed that imposing sanctions for the crime, society can achieve justice and a peaceable social order. This differs from civil law in that civil actions are disputes between two parties that are not of significant public concern. [wikipedia.org]

On the other hand, using the above definition, it's an open question as to why this guy is still playing golf [wikipedia.org] after he won his criminal case, but subsequently lost his civil case.

Re:A more fashionable solution! (1)

Brandybuck (704397) | more than 7 years ago | (#17165874)

"Normal" people go to jail...../eM?

Not in civil cases they don't.

This was a civil case, and HP essentially settled. If the case had gone on and HP lost, all that would have happened is that they would have paid a slightly larger amount of money. This action also applies only to the State of California. It doesn't stop any other party from continuing/seeking a lawsuit over the matter.

Heh (3, Funny)

lisaparratt (752068) | more than 7 years ago | (#17160388)

Ah, the wonderful Land Of The Fee.

When do they remodel the blindfold on the statue of justice so it's slipped and she can wink and look suggestively at her back pocket?

Re:Heh (4, Funny)

Harmonious Botch (921977) | more than 7 years ago | (#17160434)

Back pocket? You're assuming that she still has her pants on?

Re:Heh (3, Insightful)

Dhalka226 (559740) | more than 7 years ago | (#17160572)

I'm not really sure what the big deal here is. I'm all for routing out corruption and all that jazz, but this is an issue of civil law. They settled the case. This happens dozens, maybe hundreds of times per day in civil cases; 90% of civil cases never reach a verdict.

The fact that the article submitter chose to spin it as a "payoff" doesn't magically make it a bribe. Call me when they pay $14.5 million and get the criminal charges dropped and then I'll hoot and holler about corruption and greed in America with you. Until then, this is a total non-issue for me. The settlement may be a little bit on the low end, but then again I'm not too terribly disappointed that they didn't waste taxpayer money to pursue both a civil and criminal trial over basically the same charges/complaints.

Shhhh.... (1)

Infonaut (96956) | more than 7 years ago | (#17162294)

I'm all for routing out corruption and all that jazz, but this is an issue of civil law.

They're in high dudgeon and don't want to be confused with facts.

Re:Heh (0)

Anonymous Coward | more than 7 years ago | (#17163150)

I'm not really sure what the big deal here is. I'm all for routing out corruption and all that jazz, but this is an issue of civil law. They settled the case. This happens dozens, maybe hundreds of times per day in civil cases; 90% of civil cases never reach a verdict.

Well, isn't that the very problem with civil law? The whole idea is to try those suspected of things, but the defendant doesn't want a trial because it's expensive in of itself, and the accusers don't want a trial because randomness and human factors make it extremely difficult to judge with accuracy which way a trial will be decided with a given body of evidence. So it ends up that whenever there's an accusation, there's usually a settlement, too, which is completely wrong. If they're innocent, they should have no fear of a trial, and if they're guilty, they should pay the whole penalty, not a fraction of it because after they were caught they were willing to pay a fine without admitting fault.

Re:Heh (1)

Jeff DeMaagd (2015) | more than 7 years ago | (#17163540)

Even for the civil charges, that amount is a drop in the bucket for HP.

Re:Heh (1)

Blakey Rat (99501) | more than 7 years ago | (#17161798)

She can look at her own back pocket? I haven't looked at that statue in awhile, but I don't remember it's neck being a GIANT SLINKY!

Re:Heh (1)

lisaparratt (752068) | more than 7 years ago | (#17162008)

Hmm, I can eaily turn my head to look at my back pocket, but then I'm European.

Did they update her so she's as big as the average American?

Re:Heh (1)

Crudely_Indecent (739699) | more than 7 years ago | (#17162732)

"Land Of The Fee"
Isn't it nice to know that justice is affordable, only $14.5 million

I'm the man for the job! (1)

dotmax (642602) | more than 7 years ago | (#17160436)

Qualifications:

ETHICS OFFICER
1. Own fancy suits
2. can swat people with rolled-up newspaper while shouting "BAD KITTY, BAD!"
3. will hunt down and execute people responsible for deep-sixing the good RPN calculators.

PRIVACY OFFICER
1. Own fancy suits
2. can swat people with rolled-up newspaper while shouting "NO LOOKING!"
3. will institute manditory privacy screens for erotic interweb browsing.

Re:I'm the man for the job! (1)

hauntingthunder (985246) | more than 7 years ago | (#17162324)

"will hunt down and execute people responsible for deep-sixing the good RPN calculators." testify brother testify - where do I apply.

A nice comparison... (3, Insightful)

rallycellie (1031068) | more than 7 years ago | (#17160438)

Here in holland, where bikes are stolen as a kind of national sport it would be like: Steal 1 bicycle. get caught, go straight to jail. Steal a hundred bicycles, get caught, return 5 of them, say you are sorry, and that it was too easy and get a 'responsible citizens award' because you cooperated with the law.

Re:A nice comparison... (1)

hauntingthunder (985246) | more than 7 years ago | (#17162390)

Oh you mean the ones that make the flying Pigeon from china look high tech - weigh an absolute ton and you have to peddle backwards to brake.

I thought the people stealing them where performing a comunity service by removing a healthrisk :-)

Re:A nice comparison... (2)

TFloore (27278) | more than 7 years ago | (#17163238)

The more I see how corporations in America act, the more I think of our old buddy Joseph Stalin.

"A single death is a tragedy, a million deaths is a statistic."

A lot of corporate activity in America seems to be run with that as a guiding principle. Do something on a big enough scale, and it stops being bad, and simply becomes... unethical, but not actually illegal? And if it is done by a committee, no single person actually makes a decision, so it isn't even unethical.

Of course, this also goes back to the single purpose for a corporation. The sole purpose of a corporation is to shield liability.

*sigh*

You know, I was happier before I became cynical and jaded. Clueless, but happier.

Buying injustice... (4, Interesting)

Justen (517232) | more than 7 years ago | (#17160470)

The case did only involve a civil complaint, so it probably would have ultimately ended up with a financial settlement and some sort of compromised "corrective" measures like we see here, but I really think this is an injustice for the people who had their identities and privacy compromised, and for HP shareholders in the long run. The evidence that senior executives at HP, potentially including Mark Hurd, either ignored or were ignorant of the ongoing, "probably illegal" actions [washingtonpost.com] is pretty well documented, and pretty overwhelming.

Patricia Dunn took pretty much all the heat for this, and that's unfortunate for her and HP. It seems to me like she should have had a better grip on what was happening at HP, but it doesn't seem to me like she should have been the only one with that responsibility. A full, objective, and independent investigation should have been the first think on everybody's list. Instead, this case is now settled, Congress has moved on, and Dunn will be focussed on proving her innocence.

The unfortunate thing for Mark Hurd is that his level of responsibility and accountability wasn't determined in this process. The second HP hits a performance blip, this scandal will be the first thing on every shareholder's mind when they're thinking of who to blame. When that day comes, I wouldn't want to be in Mark Hurd's shoes.

--
justen
justen.blogspot.com [blogspot.com]

Re:Buying injustice... (4, Insightful)

wannabgeek (323414) | more than 7 years ago | (#17160492)

I really think this is an injustice for the people who had their identities and privacy compromised, and for HP shareholders in the long run.

Well, the shareholders do not seem to mind. In fact, the market is relieved that their company got away so lightly.

Re:Buying injustice... (3, Informative)

Otter (3800) | more than 7 years ago | (#17160844)

...but I really think this is an injustice for the people who had their identities and privacy compromised...

AFAICT, they can certainly still bring civil action, shareholders already are suing, the SEC is investigating and criminal charges are still on the table. Basically, HP paid a fine to avoid the risk of a larger fine, as is completely routine.

I'd wonder where "theodp" and CowboyNeal are getting their bizarre spin on this from if I didn't know that most of the people here still don't understand the difference between criminal and civil law, despite spending every day ranting about legal proceedings.

Re:Buying injustice... (2, Insightful)

NDPTAL85 (260093) | more than 7 years ago | (#17161518)

Mark Hurd is the guy who turned HP around. After their many many under-performing choices for CEO pre Hurd they know how hard it is to get a competent guy in the top job. They're not going to be getting rid of Hurd anytime soon.

Re:Buying injustice... (0)

Anonymous Coward | more than 7 years ago | (#17161578)

The evidence that senior executives at HP, potentially including Mark Hurd, either ignored or were ignorant of the ongoing, "probably illegal" actions is pretty well documented, and pretty overwhelming.

Then why the hell aren't they paying this $14.5 mill back to HP? Honestly, we need to make these top people making $million finacially responsible for their mistakes/dishonesty that cost companies $millions.

Re:Buying injustice... (1)

iabervon (1971) | more than 7 years ago | (#17163130)

This was largely an internal HP thing; half of the people spied on are on the HP board of directors. They're not going to want to mire the corporate entity in litigation. As far as reforming HP, shifting the balance of power to the people who were spied on is far more effective than any sentence that could be carried out on humans.

And the criminal cases are unaffected. That's what matters in the end; this was a case of criminal behavior by individuals in control of a company, not corporate policy.

Re:Buying injustice... (0)

Anonymous Coward | more than 7 years ago | (#17163896)

And for those criminal charges did they break down the door and take every computer, and server. No, they are politely waiting for HP to find information.

If it was a small business "door busting" would have been the very first thing they did.

Please remember to wait 48 hours after smoking crack before submitting replies to /.

Re:Buying injustice... (1)

DragonWriter (970822) | more than 7 years ago | (#17164060)

The case did only involve a civil complaint, so it probably would have ultimately ended up with a financial settlement and some sort of compromised "corrective" measures like we see here, but I really think this is an injustice for the people who had their identities and privacy compromised, and for HP shareholders in the long run. The evidence that senior executives at HP, potentially including Mark Hurd, either ignored or were ignorant of the ongoing, "probably illegal" actions is pretty well documented, and pretty overwhelming.
Yes, so? What did you expect to come out of the civil charges against HP beyond the payout and the imposition of terms that came from the settlement?
The unfortunate thing for Mark Hurd is that his level of responsibility and accountability wasn't determined in this process.
I think that's fortunate for Hurd, if anything; but criminal cases can expand to implicate new defendants as they progress, and Dunn is not the only one already facing criminal charges. (Plus, HP shareholders have their own suit against the company for shenanigans related to the scandal, and this doesn't affect that.)

Chief Ethics Officer?! (1)

jimicus (737525) | more than 7 years ago | (#17160510)

Chief Ethics Officer? In a company like HP? That's going to be a boring job.

On the plus side, I guess you can have "CEO" on your business cards.

Re:Chief Ethics Officer?! (1)

remmelt (837671) | more than 7 years ago | (#17160596)

Yes! And CPO is kind of like a version 0 of C3PO, so that would be cool too!

Re:Chief Ethics Officer?! (1)

TheJasper (1031512) | more than 7 years ago | (#17160988)

For some reason slashdot requires the facts to be stated and restated in multiple posts without actually changing anyones opinion on anything (mostly because they read only what confirms their own worldview anyway).

You should applaud HP for this. They settled for a civil suit. not criminal, civil. They said they were wrong. They are making amends. They are instuting policies to not let it happen again. However much you trust the effectiveness is irrelevant. You keep an eye on them if you're that worried. They could've kept this in the courts for years, costing the state and themselves alot of money. Money which comes from taxes or product prices.

You can't keep making companies bad guys wether or not they try to do the right thing. Be mad when they do wrong, be happy when they do right.

my question for the cynics: If this is bad 'justice', what should've happened?

More like Ethically Challenged Officer (1)

sethstorm (512897) | more than 7 years ago | (#17161500)


For some reason slashdot requires the facts to be stated and restated in multiple posts without actually changing anyones opinion on anything (mostly because they read only what confirms their own worldview anyway).

Apparently you dont know about NCR after AT&T with respect to the leadership under Nyberg. Carly seems to be off the radar as well. Nor do you seem to remember how far they went to keep her.


However much you trust the effectiveness is irrelevant. You keep an eye on them if you're that worried.

With HP's history on Carly Fiorina, they warrant such scrutiny. Also, Hurd's time at NCR under Lars Nyberg validates it even more if these actions were allowed to happen.


my question for the cynics: If this is bad 'justice', what should've happened?

A penalty that cannot be passed on to downstream parties outside of HP. Ideally it would be something that is passed on directly to those responsible, allowing the less ethically challenged parts to continue operating.

With multiclass shares and stock dilution as possible weapons, I doubt that avenue could be used if you're viewed as a hostile person with a ton of cash.

Re:Chief Ethics Officer?! (0)

Anonymous Coward | more than 7 years ago | (#17165542)

Boring yes... until your rubber stamp runs out of ink! Correct me if I'm wrong, but didn't HP _already_ have a Chief Ethics Officer (Kevin T. Hunsaker), and didn't he sign off on the spying? Yep [com.com]

Bah and bah again. (0)

Anonymous Coward | more than 7 years ago | (#17160658)

If something like this happens in your country, how on earth can you go and claim you're living in a free, democratic country?

I mean, democracy obviously has nothing to do in a country where deep pockets are obviously running the scenes. And it's news like this that shows that it's indeed the deep pockets that are enjoying the absolute power. Power to the people? Sounds nice in speeches. But the 'democratic' reality in these kind of countries is that 'the people' can press a lousy button once every four years (if they're even that lucky), and that that's ALL the voice they're ever going to get. Government in these countries is run by political-economical lobby by big, powerfull multinationals and business-conglomerates, who try very hard to hide this fact from the public eye by spreading the 'illusion' that buying a consumer-product is like 'voting' for the company that produces it. So much for democracy.

And freedom? How on earth can anyone actually feel free in a country where citizens are put behind bars for minor fraud, while businesses like HP (which are actually run by REAL people!!) can pay-off a judge while calling it 'being sanctioned'?

I really wonder how a country like that can tell the rest of the world what to do, and still live with itself. It seems the entire country has MPS or something...

Re:Bah and bah again. (1)

GigsVT (208848) | more than 7 years ago | (#17161266)

Martha Stewart committed what most would consider a minor fraud. She was a very rich woman at the head of a very large corporation. She still went to jail.

In case you didn't notice, criminal charges are still pending in this HP case.

Re:Bah and bah again. (1)

nomadic (141991) | more than 7 years ago | (#17161834)

Martha Stewart committed what most would consider a minor fraud. She was a very rich woman at the head of a very large corporation. She still went to jail.

A lot of the Enron people were convicted too. These were invariably very wealthy, VERY well-connected people.

Re:Bah and bah again. (1)

Hijacked Public (999535) | more than 7 years ago | (#17163118)

Indeed true, apart from the one guy who took the quick way out. But those people are the sacrificial lambs, sacrificed to convince people that the system still works just fine and that justice will indeed be meted out no matter how much money you have. It keeps people from flipping over cars and setting their own homes on fire in protest, which is fine but not something you want happening every other day.


For every Martha Stewart and Enron exec you have a thousand faceless men who, despite having committed all manner of crimes against humanity, die with their reputations intact, gold star sill next to their names, their life history free of any indication of wrongdoing.

Re:Bah and bah again. (4, Informative)

east coast (590680) | more than 7 years ago | (#17161268)

How on earth can anyone actually feel free in a country where citizens are put behind bars for minor fraud, while businesses like HP (which are actually run by REAL people!!) can pay-off a judge while calling it 'being sanctioned'?

It's called a CIVIL case. If you're not familiar with the American legal system you probably don't know how far off base you are. You can not be "put behind bars" in a civil case. This is a case to determine liability in terms of monetary damages. The criminal case will still happen and that's where people get jailed.

Either you don't know what you're talking about or you're just a troll.

Re:Bah and bah again. (0)

Anonymous Coward | more than 7 years ago | (#17167172)

Either you don't know what you're talking about or you're just a troll.


The more I read /. the more I think the majority of posters are most likely both.

Remember (1)

oliverthered (187439) | more than 7 years ago | (#17160706)

It's not just HP that do this kind of thing, it's what Governments (your servants) are up to all over the world every day.

In other countries, this is called a BRIBE (-1, Flamebait)

Anonymous Coward | more than 7 years ago | (#17160722)

ofcourse, when it's USA, it's called a 'negotiated payoff'. All other countrie are just third-world hellholes mired in corruption, esp the brown ones,right?

bit3h (-1, Troll)

Anonymous Coward | more than 7 years ago | (#17160778)

BSD has 4lwa7s [goat.cx]

Call me a cynic.. (1)

rHBa (976986) | more than 7 years ago | (#17160812)

HP also agreed to maintain the watchdog positions of chief ethics officer and chief privacy officer for five years

but the Scientologists had (have?) a Watchdog Committee and Ethics Officers and we can all trust them now can't we...

OT: cdn.eyewonder.com???? (0)

Anonymous Coward | more than 7 years ago | (#17160868)

What the hell is it with the animated ads? "waiting for cdn.eyewonder.com" or "getting data from cdn.eyewonder.com" is stopping my scroll of the main page more than 50% of the time

Who does the money go to? (1)

Van Cutter Romney (973766) | more than 7 years ago | (#17160876)

What I don't understand is - whose coffers does the money go to? How is this money then used? Why does the company have to pay the state or whoever $14.5 million dollars for something that was, though illegal, done internally in the company. It did not affect any external parties, the state etc. And what does the article mean by The AG's office 'negotiated' a settlement?
Sounds like open bribes to me ... but what do I know?

So the shareholders pay? (1)

SkunkPussy (85271) | more than 7 years ago | (#17160964)

Thats ridiculous - the shareholders must pay for the directors' irresponsilibity?

And since when was it possible to settle criminal cases! ridiculous

nuke california

Re:So the shareholders pay? (1)

Chapter80 (926879) | more than 7 years ago | (#17161076)

Yes, the shareholders elected the Board. So ultimately you pay for your bad choice (assuming you're a shareholder). Now, if you (as a shareholder) want to go after the individual Board members, have at it.

Re:So the shareholders pay? (1, Informative)

Anonymous Coward | more than 7 years ago | (#17161178)

Thats ridiculous - the shareholders must pay for the directors' irresponsilibity?

Uh, yeah. It's called "ownership". You own (part of) the company, you take (part of) the risks. Those risks include the possibility that your asshat employees (including your board) will screw you.

And since when was it possible to settle criminal cases! ridiculous

Jesus, not only didn't you RTFA, you didn't even read the /. post. It was the civil case that was settled. Criminal charges are still in play.

Re:So the shareholders pay? (1)

DragonWriter (970822) | more than 7 years ago | (#17164114)

<blockquote>Thats ridiculous - the shareholders must pay for the directors' irresponsilibity?</blockquote>

Yes, the shareholders pay for their directors' irresponsibility. This makes the shareholders responsible for the choice of directors. (Of course, the shareholders are free to sue the directors for violating their obligations to the shareholders.)

<blockquote>And since when was it possible to settle criminal cases!</blockquote>

This wasn't a criminal case; the criminal cases against Dunn and four others are still progressing; OTOH, plea bargains, the rough analog of a civil settlement (but that don't allow avoiding admission of guilt) do exist in the criminal system, and have for some time.

ridiculous

nuke california

Re:So the shareholders pay? (1)

DragonWriter (970822) | more than 7 years ago | (#17164168)

Ick. Didn't mean to spin to "Code", and meant to hit Preview rather than submit. That came out badly...

Not really that bad and not really news.... (1)

dculp (669961) | more than 7 years ago | (#17161086)

Before all the knee jerk reactions start (too late for that) stating this is unfair or a travesty of justice, it is not. This is simply an out of court settlement for a civil case. Anyone could have done the same thing.

For example: My neighbor wants to sue me in civil court for some perceived wrong doing. I go to my neighbor and say "Listen, instead of dragging this thing to court why don't I pay you X sum of money and agree to not do it again." My neighbor could accept the settlement and be done with it.

If what I had done was also criminal then the appropriate authorities could still pursue criminal charges against me, but my neighbor would be finished with me.

That is all that happened here, nothing more.

mogd doWn (-1, Offtopic)

Anonymous Coward | more than 7 years ago | (#17161156)

we all know, Lay down paper When I stood for 7he point more Problems with of Events today, you can. No, poor priorities, fucking percent of before playing to taken over by BSDI

Revised definition (3, Insightful)

BCW2 (168187) | more than 7 years ago | (#17161308)

When did impersonating a law enforcement officer get redefined as "pretexting". The former is a criminal offense and the latter is revisionist bullshit. There should be criminal charges for every person involved in this idiotic farce.

sneak preview for HP employees (2, Funny)

rifftide (679288) | more than 7 years ago | (#17161372)

The appointment of a Chief Ethics Officer means you'll need to complete online training every year to ensure that you understand the ethical dimensions of your job.

Here's an example verification, which I found by hacking one of the servers:

Suppose a supplier offers to bribe you with a pair of World Series tickets to increase your purchases from his company. Should you:

a) Say yes! Baseball is America's game, and give-and-take is good business.

b) Refuse the offer and report the incident to top management

c) Ask about the seats. Might as well watch the game on HDTV if it's the bleachers, but infield grandstand starts to get interesting

d) Giants in the Worlds Series? AHAHAHAHAHA

Slashdot + Anything Law Related = (1)

DBett (241601) | more than 7 years ago | (#17161920)

stupidity. Jeez folks, how bout we find a moderator that at least understands what CIVIL case means.

Slashdot is missing the biggest part of the story! (0)

Anonymous Coward | more than 7 years ago | (#17162760)

The biggest question behind these damages is being missed by most people here - Q: How the hell did HP's damages get spun into an anti-piracy effort? And more importantly, who was doing the spinning?

From the NYTimes article: vast bulk of H.P.'s statuatory damages are to "... finance the investigation of consumer privacy violations and of intellectual-property theft, *** including the copying of movies and music*** ..."

So, why is this money not being spent to, say, combat consumer identity theft? Or to dissuade other companies from invading the privacy rights of individuals? Or to further compensate the actual victims in this particular case?

Mod Parent UP (1)

Your Pal Dave (33229) | more than 7 years ago | (#17163614)

The biggest question behind these damages is being missed by most people here - Q: How the hell did HP's damages get spun into an anti-piracy effort? And more importantly, who was doing the spinning?

From the NYTimes article: vast bulk of H.P.'s statuatory damages are to "... finance the investigation of consumer privacy violations and of intellectual-property theft, *** including the copying of movies and music*** ..."

So, why is this money not being spent to, say, combat consumer identity theft? Or to dissuade other companies from invading the privacy rights of individuals? Or to further compensate the actual victims in this particular case?


Somebody needs to mod the AC parent up!

Re:Mod Parent UP (1)

el americano (799629) | more than 7 years ago | (#17166754)

If only he weren't AC, I would have modded him up immediately.

Re:Mod Parent UP (1, Informative)

Anonymous Coward | more than 7 years ago | (#17168996)

Allow me to expand the concept here:

The Attorney General in question here is Bill Lockyer, who in 2004 was found to be shopping around draft legislation provided to him by the MPAA:
http://www.wired.com/news/culture/digiwood/0,62665 -0.html [wired.com] ... the same MPAA whose seven members were contributors to Bill Lockyer's 2006 campaign ...
http://www.slumdance.com/blogs/brian_flemming/arch ives/000809.html [slumdance.com] .. and, yes, that's the same MPAA that killed the anti-pretexting bill:
http://www.wired.com/news/technology/0,72214-0.htm l [wired.com]

So the California A.G. has just taken statuatory damages levied against H.P. for infringing upon the rights of the individual ... and instead of using them to, I don't know, help protect the rights CA citizens - he has reserved them for use in anti-piracy litigation.

Heck of a job, Lockyer.

Why I will be wary of HP products. (1)

Kopl (1027670) | more than 7 years ago | (#17162784)

It's not because this person got spied on, it is because the people in charge at HP were willing to spy on her. Here in the US, the republicans that have been in power for the last 4 years have believed that regulating companies was bad and that people should do it with their wallets. That is what I am doing. HP showed me their lack of morality, I am going to show them and other corporations that I don't tolerate that. I know that I am just one person, but I figure that there are probably a bunch of others doing the same thing, and that this is helping them.

The result(though it may or may not be significant), will be that it is in the best interest of companies to obey ethics.

I wish (1)

jbertling1960 (982188) | more than 7 years ago | (#17163530)

As an ex-HP employee, I wish that they could get rid of their many layers of largely bad management for a paltry sum of 14.5 million. It would be cheap at twice the price.

Glad to see they will require a Chief Ethics Offic (1)

xmas2003 (739875) | more than 7 years ago | (#17163714)

"HP also agreed to maintain the watchdog positions of chief ethics officer and chief privacy officer for five years."

Especially because their previous one (and also their general counsel) were involved in the pre-texting scandal ...

What's the percentage...? (1)

fahrbot-bot (874524) | more than 7 years ago | (#17164980)

The California Attorney General's Office negotiated a $14.5 million payoff from HP as part of a settlement that calls for the state not to pursue civil charges...

I guess everyone has their price. Perhaps someone can calculate what percentage of HP's net worth is $14.5 million so others could use that same percentage to settle their civil suits with CA ...

I'm guessing it would be *very* affordable. :-)

How much is your privacy worth? (1)

JhohannaVH (790228) | more than 7 years ago | (#17166118)

14.5 million???? That's *IT*???

But then, this is the most corrupt state in the union, what more do you want? *shakes head*

so who pays the fine? (1)

cdn-programmer (468978) | more than 7 years ago | (#17167002)

Clearly not those who are responsible!

THe fine gets paid by the shareholders and customers and perhaps a few low level employees who get fired. The fine is not paid by those who are guilty.

settlement fund (1, Interesting)

Anonymous Coward | more than 7 years ago | (#17167954)

--
As part of the settlement [...] HP will "finance a new law enforcement fund to fight violations of privacy and *intellectual-property* rights"
--

So... HP is to give money to RIAA/MPAA?

meaningless settlement. (2, Funny)

swschrad (312009) | more than 7 years ago | (#17168090)

HP burns 11.5 million dollars on shredder oil per year. this settlement means nothing to HP, which remains the poster boy for no ethics in business for spying like Putin.
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