Patricia Dunn Should Resign

Maybe I’m overly sheltered, but this story of HP’s chair, Patricia Dunn, and her alleged role in an investigation into HP’s own board’s “leaking” is astonishing. Read the letter from ex-HP director Tom Perkins (who resigned over the issue) to the HP board, as well as the attached document describing how someone in HP’s employ hacked Perkins’ residential phone line.

Perkins walked out of a board meeting last May when Dunn announced what she had done, but that didn’t embolden his fellow directors to call Ms. Dunn on her complicity in the investigation. It’s time HP shareholders did what HP’s board lacked the balls to do: Call for Ms. Dunn’s resignation.

The only remaining question(s): What did ex-HP CEO Carly Fiorina know, and when did she know it? It seems clear she was increasingly irritated at her board, and created a culture where investigating one’s own board wasn’t beyond the pale.


  1. Bleah, stupid unethical behavior by Dunn. She should know way better. But what’s the point of bringing up Carly, she had been gone for almost a year by the time the leak happened. That’s just a cheap shot on your part, Paul.

  2. Totally disagree with you, Fred. In fact, Carly’s where all this poison started, as I explain in depth in my own blog entry:

  3. i’m w/ you all the way on this paul. i hate to sound naive but i find this spying fiasco completely shocking. the chairwoman should be “one and dunn.” … would like to hear from Hurd on this issue. as mastermind of the HP turnaround, needs to exercise some leadership.

  4. Shocking is absolutely right. And it’s not as though these board members are folks that would respond to such poor behavior. Did they really think someone of Mr Perkin’s stature would NOT take their board/legal responsibilities seriously??? The implied combination of stupidity and sheer arrogance is astounding.
    I also agree with bringing up Fiorina. A company does not become that arrogant overnight — it seems likely that the seeds were planted by the earlier regime.
    What an awful and sad new chapter in HP’s history.

  5. I’ll go further. Why don’t the remaining board remembers resign. The fact that they didn’t take action shows they are incompetent in their fiduciary responsibilities.

  6. I don’t know why, but I sure get a kick out of the fact that the guy who obtained the phone records under pretext used the email address

  7. Dorrian — You and I are too much alike: I had the same reaction. Whoa, lucky guy … waitaminute.

  8. Dave, I don’t think your blog entry makes a convincing case for Fiorina being the root cause of this problem. Were you at HP during her tenure? Do you have more direct evidence than a bit of hearsay? I was, and in my (admittedly limited) experience she was highly ethical. Ultimately flawed and certainly unsuccessful, but nonetheless she had a great deal of personal integrity.
    This is not in any way to excuse Dunn’s actions, only to separate issues that I believe are being incorrectly conflated.

  9. You go, girl! Hooray for Dunn! What a perfect model of the smart, powerful, protector of individual investors. If not for her, the traitors on the board would have kept on leaking HP’s secret and proprietary information. She did exactly the right thing under exactly the right set of conditions. She’s got big balls, and that’s cool for a woman. I for one appreciate her dogged pursuit of the lying board member.

  10. MHS/Patricia: You’ll have to remind me sometime how a secret, illegal investigation of board members represents a proportionate and shareholder-friendly response to the supposed offence.

  11. Paul Kedrosky – I don’t understand your reasoning for investor confidence. If secrets keep leaking out worse than a leaking boat, its time you plugged it, otherwise you sink. Patricia only undertook what was a precedent, not a fresh rule. If this hadn’t been done, the leaking would have continued forever and would have lowered the value of HP at some point. It may have resulted in opponent companies gain marketshare too. Would HP loosing marketshare hit investor confidence more or timely action taken to prevent future incidents hit confidence more? Corporate wars are one thing, but undermining corporate confidence is another. What do you feel should have been done if no action had been taken? Dunn rightfully plugged the leaking balls.

  12. Padrevaters, I suggest you read comment number 10 again… :)

  13. Padrevaters says:

    Are you dumb? Does that answer my question? Nada. Read my answer very carefully.

  14. Padrevaters says:

    I have just one question to ask you. If there’s a leaky boat, how does it matter how the leak is plugged as long as you are safe?

  15. Padrevaters–When is breaking the law EVER justified? I’m not saying you shouldn’t handle leaks, I’m just saying they should have found a different way. I don’t care who you are when protecting secrets, you absolutely MUST follow the law.

  16. Padrevaters, how would you feel if your employer pretexeted and ILLEGALLY obtained information to spy on you just because they merely didn’t trust you? Even if you did nothing wrong. How would you feel?

  17. Padrevaters says:

    Joe – Would a terrorist actually say, I am going to bomb this? Or would he ever agree that he has bombed a place without proof? The same here. I doubt the guy in question would have stated that he leaked if he was not confronted with proof. And I don’t subscribe to your view – simply because if those guys earn in millions, they bloody well be subject to lnvestor confidence and confidentiality. I don’t want another Enron, I want more HP’s and M$. Otherwise if the leaks had continued, wonder how much loss it would have meant for HP. Currently the market is affected by it, but am sure it would rebound faster than anything else. It would be a temp glitch.
    As for your question – if I was a corporate member (supposedly) why would I leak something in the first place? (That should be the question you should be asking) Given that I have leaked confidential news privy to the board members, am I not subject to the company rules? I am. If I am the source of the leak, kick me out! Remember that the investigation was not conducted by any employee of HP, but by an independent investigating agency. And there are no set of rules for investigations. How does it matter how the investigation was done, as long as they got the evidence against a cyber terror? (for every company, leaks are a common headache, be it a HP or a M$)

  18. Padrevaters says:

    Paul – It depends on how you look at it. Is plugging the leak important or business ethics first? Come to think of it, Mr. Keyworth did say that all she needed to do was ask, but would he have stated it if he was not confronted with evidence?
    Business ethics is one thing. Corporate wars are another. It is tough to survive in a world with honest practices. In the end, Dunn ‘outsourced’ the investigation, which was not done by any employee or the company security. It was done by an outside investigating agency. And do you expect a terrorist to state that he is going to do an act? No way, is any guy going to state it. And whatever the investigating agency found was ethical as they got the answers. How does it matter how you plug a leaking boat? It MUST be plugged. The only question was how best to go about with the task of confrontation. I think she should have done it on a personal note with him and warned him about it. That would have been sufficient!

  19. All: It is much more basic than a discussion on wether Mrs. Dunn had the right to check upon her colleagues … It’s about double standards and the damage to the business it does!
    FYI: every HP employee has to take an ethical Business Code of Conduct training (via e-learning). Officialy the company is very strict upon this BCC. But if you’ve ever worked for HP, you quickly realise that application of sanctions in the case of violations, depends ONLY on who you are and who you know. And that indeed is something that was not part of the HP culture before Carly … It became part of HP during all the mergers and culture clashes.
    Conclusion: if Mrs. Dunn and HP consider BCC as a cornerstone of the company, she has no choice then to resign.

  20. Changing the subject a trifle, what are Ms Dunn’s qualifications? What jobs has she held previously?

  21. And she takes the fall… She’s out. Good. Leaks SHOULD be handled. But corporate wars and secrets do not supercede the law.

  22. Are we missing a point here? The unanswered question is: what was exactly leaked?
    As far as I’ve understood it so far nothing really business important information was leaked to CNet.
    Am I wrong or was it just a case of playing board room politics and a manhunt with no reason?

  23. Padrevaters says:

    How dumb can you get? Earlier it was leaked about Carly’s differences with the board. If you had noticed the stock markets, you would have noticed the difference it made to investor opinion. The next one, is the future roadmap of HP. Now don’t tell me that it is NOT SIGNIFICANT business information, because I am sick of that reasoning. That is what triggered the investigations by Dunn in the first place. Americans have a tendency to hype ridiculous things while underplaying the big ones. This is a standing example.
    Another standing example of an American displaying his skillsets – 9/11 is triggered by Osama and Bush goes after Iraq?
    ‘Ethics’ is a reason for loosers to hide behind. Where was this ethics in the 70s?

  24. Padrevaters said: “‘Ethics’ is a reason for loosers (sic) to hide behind. Where was this ethics in the 70s?”
    People with attitudes like that are the reason that our country/world is so screwed up. This will be my last correspondence with Padrevaters.

  25. Padrevaters says:

    Hey! Joe. Have I given you reason to feel offended? If so, I apologize. Let me put it across in a more simple way. My reasoning is very simple. Why should a criminal be let go? Why one rule for white collar crime and a different rule for the actual physical crime? Aren;t they all criminals?
    If a spy can be shot and a mole hanged, why is a person only fired from a boardroom? Shouldn’t legal action be taken against him?
    What I mean is when a country is going great guns, nobody really cares about ethics, be it a China, USA or any. When there is a downturn, all things including ethics come into the picture. What you see is a public display of ethics. You dont know how dirty it can get in actual board rom
    I apologize once again if I have been too harsh…

  26. Pedrevaters, No need to apologize to me. I see your point now. And I think we pretty much agree that leaks are bad, ethics is important etc..
    I never said the mole should go unpunished.
    Where I think we disagree is that I say that HP should never have broken the law, whereas you seem to justify it because it removed a mole.
    Being a business owner myself, I’d want the mole to be punished in some legal way. Two wrongs however don’t make a right, and I cannot use illegal means to determine who the mole is.
    Also perhaps I took your comment wrong, but I don’t believe ethics is for losers, and I do believe that anyone who says so is why we even have problems in the first place.