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California's Attorney General has hit five people tied to HP's spy probe with felony charges.

Leading the list of the accused is former HP Chairman Patricia Dunn, who resigned from her position as a director last month. Former HP counsel and ethics chief Kevin Hunsaker was also named in the lawsuit, as were Ron DeLia, director of investigative firm Security Outsourcing Solutions (SOS), Matthew Depante, manager of information broker Action Research Group (ARG) and Bryan Wagner, also of ARG. Beyond providing conveniently comical acronyms, SOS and ARG assisted HP in its now infamous spy probe.

Attorney General Bill Lockyer's lawsuit, filed in the Santa Clara Country Superior Court, alleges that all of the accused used false pretenses to secure the phone records of people being investigated by HP.

“One of our state’s most venerable corporate institutions lost its way as its board sought to find out who leaked confidential company information to the press,” said Lockyer. “In this misguided effort, people inside and outside HP violated privacy rights and broke state law."

Those not hiding in a bunker for the last few weeks will be aware that HP relied on identity fraud to get the phone records of its own directors and employees and ten reporters. As the AG sees it, this practice violated statutes covering fraudulent wire communications, wrongful use of computer data, identity theft and conspiracy to commit such crimes.

The AG declined at this time to file charges against HP's former lead counsel Ann Baskins or head of investigations Anthony Gentilucci. Both former HP employees had intimate knowledge of HP's mole hunt and took the fifth last week when they went before Congress.

The four felony counts carry a top prison sentence of three years and fines ranging between $10,000 and $25,000. The AG has requested that the court issue warrants for the arrest of all five defendants and is looking to extradite DeLia, Depante and Wagner - who live out of state.

Turning to Dunn, the AG's complaint alleges that "she gave DeLia the home, cell and office phone numbers for Hewlett-Packard board members in April 2005. Two months later, in a June 2005 briefing provided by DeLia to Dunn and Baskins, Dunn learned 'telephone records were obtained by ruse from telephone and cellular carriers.' Then, beginning in January 2006, with full knowledge of the methods used to obtain phone records, Dunn participated in renewing Hewlett-Packard’s leak investigation, subsequently received regular briefings on its progress and therefore knew DeLia was again part of the investigation team."

Dunn's lawyer was quick to go on the offensive by saying, "These charges are being brought against the wrong person at the wrong time and for the wrong reasons. They are the culmination of a well-financed and highly orchestrated disinformation campaign."

Meanwhile, DeLia told CBS, "I have been a professional private investigator for more than 30 years. I respect the law. I did not break the law in the H-P investigation."

You can bet that this puppy will drag on for a long time, and we don't think the AG is, er, done just yet. The US Securities and Exchange Commission is also investigating the situation by examining how HP handled the disclosure of former director Tom Perkins' resignation from the board.

You can find a copy of the complaint in PDF format here. ®

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