STEVE INSKEEP, host:
The computer maker Hewlett-Packard has agreed to pay $14.5 million to settle a civil complaint brought by the state of California. This complaint stemmed from HP's secret effort to spy on its own directors and on news reporters in order to find the source of boardroom news leaks. NPR's Scott Horsley reports.
SCOTT HORSLEY: California Attorney General Bill Lockyer says Hewlett-Packard committed substantial invasions of privacy when its contractors impersonated board members and news reporters in order to get their telephone records without the caller's consent.
Once the spy scandal came to light, however, Lockyer says HP took responsibility for its actions and didn't stonewall. He says HP's spy scandal appears to have been a one-time mistake.
Mr. BILL LOCKYER (California Attorney General): It was terrible and very, very stupid, frankly, to let these illegal activities occur. But they're chagrined and reformed and trying to move forward.
HORSLEY: Most of the $14.5 million settlement will go to a new state fund for prosecuting identity theft and protecting intellectual property rights. HP has also agreed to internal reforms, such as naming an independent director to serve as an ethical watchdog for the board.
CEO Mark Hurd says the company is pleased to settle the case and committed to regaining its standing as a global leader in corporate ethics. Five people accused of involvement in the spy scandal still face criminal charges, including former HP chairwoman Patricia Dunn.
Scott Horsley, NPR News, San Diego. Transcript provided by NPR, Copyright NPR.
