Hurd told a news conference that Dunn's resignation was effective immediately and that he would take over her duties as chair of the HP board. "We believe it is in the company's best interest that she now step aside given the distraction her presence on our board continues to create," Hurd said. "We have never questioned her intentions, her integrity, or her ethics."
Dunn had been due to step down January 2007 but her departure was moved up amid allegations that HP's investigators impersonated board members and journalists to get private telephone records.
"Some of the findings uncovered are very disturbing to me," Hurd said at the company's office in Palo Alto, California. "On behalf of HP I extend my sincere apologies to those journalists investigated and everyone who was impacted."
Hurd said that his offer to testify with Dunn and HP lawyers before the House of Representatives' Energy and Commerce Committee in Washington September 28 had been accepted.
The hearing will focus on whether private investigators hired by HP spied on board members, employees, and reporters in a campaign to plug a company leak.
At issue was whether the investigators impersonated people to gain access to their telephone records, secretly followed people, and tried to trace company e-mail to learn where it was forwarded.
California Attorney General Bill Lockyer said last week that he had enough evidence to criminally prosecute people "inside and outside" the world's second largest personal computer company.
"This is a complicated situation and the more I look into it the more complicated it becomes," Hurd told reporters.
Hurd said that he called the press conference and volunteered to testify before the congressional committee to show that any illicit tactics used to plug the boardroom leak were unsanctioned aberrations.
"We believe that these were isolated instances of impropriety and not indicative of how we conduct business at HP," Hurd said. "What began as an investigation with the best intentions has ended up turning in a direction we could not have possibly anticipated. The people of HP don't deserve this nor do any of the people impacted."
The problem of supposedly secret information leaking from board meetings had long vexed HP.
In January of this year an internal probe was renewed and "the process broke down and no one in the management chain caught it," the chief executive said.
Hurd was adamant that he was never told of questionable investigative tactics along the way and that if anyone sent him details in a memo, he never read it.
The HP leak probe included impersonating people to get telephone records; picking through trash; sifting through company e-mail records, and surveillance of a board member and a reporter, said Attorney Mike Holston of a law firm brought in by Hurd to investigate what happened.
Social security number information supplied by HP was used to get some of the private telephone records, according to Holston.
Hurd sanctioned a ruse to send a reporter an e-mail from a fictitious disgruntled HP executive in the hope that the journalist would forward it to the boardroom leak and they could track it, Holston said.
The bogus e-mail was embedded with a tracer, but the ploy did not work, according to the attorney. Hurd said that he knew of the e-mail but not the tracer. Some HP workers "knew of the investigation or helped," Holston said.
Along with announcing Dunn's immediate resignation, Hurd said that former US prosecutor Bart Schwartz was hired to review HP's standards and investigative practices "to insure an appropriate level of rigor and discipline."
"I take full accountability to drive the actions to set it right," Hurd said. "Our job is to fix this and get back to the job of running a business."
Dunn, 53, took over last year as non-executive chairwoman after the stormy reign of Carly Fiorina. Dunn said that she did nothing wrong but was resigning at the request of the board.
"I look forward eagerly, in the near future, to setting the record straight and going back to leading my life as discreetly as possible," Dunn said while being inducted into a business hall of fame in San Francisco this week.
"And in the meantime, it wouldn't hurt if the Pope continued to make controversial comments to grab the attention of the press."
© 2006 Agence France-Presse
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