State accuses HP of misleading investigators

NEW YORK: California's attorney general has accused Hewlett-Packard Co. and its lawyers of misleading investigators and frustrating state and federal probes into potential defects in millions of computers, the Wall Street Journal reported. The newspaper said the state disclosed "improper tactics" in court documents unsealed within the last two weeks in the Superior Court of California in San Francisco.

The Journal said the allegation surrounds $27.5 million in consulting fees Hewlett-Packard paid to Phillip Adams, a computer expert who had alerted law-enforcement officials about suspected flaws in floppy-disk drives in Hewlett-Packard and other companies' PCs that can randomly delete or alter data without users' knowledge.

As state and federal officials investigated his claims, the Journal said, Adams abruptly switched sides and signed a lucrative consulting agreement to help defend Hewlett-Packard in certain future litigation. He also handed over his patented software "fix" to the company and pledged that he would not assist private plaintiffs' lawyers seeking damages from Hewlett-Packard, the Journal said, citing the court documents.

According to the Journal, a spokesman for California Attorney General Bill Lockyer said that the state went after the "truly extraordinary conduct" of Hewlett-Packard and Adams "to prevent whistle-blowers from switching sides in (a case) midstream, colluding with the defendants" for financial gain "and then undermining" state cases.

© Reuters