Saturday, December 9, 2006
© Copyright 2014
Gwinnett Daily Post
SAN JOSE, Calif. - Investors have largely shrugged off Hewlett-Packard Co.'s boardroom spying scandal, dismissing the brouhaha surrounding the company as immaterial to its day-to-day operations and stellar earnings growth in recent months.
That was true again on Thursday, when HP's stock price remained largely unmoved after the company and the state Attorney General Bill Lockyer announced that HP would pay $14.5 million to settle a civil claim centered on the dicey tactics used in the investigation.
HP's stock, which has actually gained around 9 percent since the probe was disclosed in a regulatory filing, fell just 24 cents to $39.62 in morning trading on the New York Stock Exchange on Friday. Details of the agreement were announced after the market closed.
Analysts said the penalty was relatively minor and would go a long way toward assuaging fears among skittish investors.
''It looks like they got off pretty easy, and that this is actually going to be a good thing for HP,'' said Roger Kay, who follows the company as president of market research firm Endpoint Technologies Associates. ''It looks like they're in control of their destiny and have put at least some of this behind them.''
The lawsuit accused the company of unfair business practices in its crusade to unmask the source of boardroom leaks to the news media.
The vast majority of the settlement - $13.5 million - will fund state and local investigations into privacy rights and intellectual property violations, according to the lawsuit and settlement filed simultaneously in Santa Clara County Superior Court.
The lawsuit marks the first civil case brought by authorities against Palo Alto-based HP for the scandal that erupted in September and led to criminal charges against former chairwoman Patricia Dunn and four others.