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HP Spy Scandal: Charges Against Ex-HP Chairwoman Dunn Dropped (UPDATED)

A judge dismissed the criminal case against former Hewlett-Packard (HP) Chairwoman Patricia Dunn on Wednesday.

By Meridith Levinson

March 14, 2007 — CSO —

A judge dismissed the criminal case against former Hewlett-Packard (HP) Chairwoman Patricia Dunn on Wednesday.

The California attorney general’s office stated earlier Wednesday that Dunn and three other defendants—Kevin Hunsaker, Ronald DeLia and Matthew DePante—would plead guilty to misdemeanor counts in the boardroom spying case.

But in a later statement, it admitted error. Dunn did not enter any plea to the charges, the attorney general’s office said. The three other defendants pleaded no contest to misdemeanor charges of fraudulent wire communications. The court did not accept their plea, but offered to dismiss the case against them if they completed 96 hours of community service and paid restitution to victims, the attorney general’s office said in the later statement.

Patricia Dunn

Dunn’s attorney, James Brosnahan of Morrison & Foerster, said Wednesday that the judge had done the right thing.

"We have maintained from the beginning that Pattie Dunn was innocent and thus vigorously fought the charges against her. Today, the judge dismissed the case. Ms. Dunn did not plead to anything," Brosnahan said in a prepared statement.

The events Wednesday ended a major chapter in a scandal that has drawn wide attention to HP but hasn’t significantly hurt the company’s business. A federal investigation is ongoing, the U.S. attorney’s office in San Francisco said Wednesday.

Another defendant, Bryan Wagner, has pleaded guilty to federal charges in the case and as a result can’t be prosecuted by the state. Those who had charges dropped against them on Wednesday could still be charged with federal crimes, the California attorney general’s office said.

HP declined to comment on the case.

Nathan Barankin of the attorney general’s press office said he issued the incorrect statement Wednesday morning after being told by prosecutors working on the case that the defendants would enter pleas that day. Because the defendants had been negotiating a plea bargain, he mistakenly assumed they all would plead guilty, Barankin said.

"This is purely staff error by me," Barankin said.

Hunsaker was an HP lawyer; DeLia is an investigator with private investigation firm Security Outsourcing Solutions; and DePante was a third-party consultant working with Action Research Group.

The four defendants had been charged with fraudulent wire communications, wrongful use of computer data, identity theft and conspiracy. On the corporate level, HP agreed in December to pay US$14.5 million to settle potential civil charges in the case.

In January, the California attorney general offered to drop felony charges against the four defendants if they pleaded guilty to one misdemeanor each.