Hewlett Packard's mess is getting worse with reports that the company is now being sued by shareholders over breaches of federal kickback and foreign bribery laws. According to the complaint, HP violated the federal anti-kickback law by paying government vendors "influencer fees" to win contracts to design information technology systems. It's no surprise given that HP had already agreed to pay $55 million to settle a Justice Department probe.
The lawsuit comes at the worst possible time for HP. Earlier this year, it had sacked its CEO Mark Hurd, allegedly over sexual harassment but really because the board was gunning for him. Hurd has since gone to join HP's rival Oracle. HP is now suing Hurd to stop him throwing his lot in with Oracle. Significantly, Hurd is also being targeted in the lawsuit.
This is going to get messier and messier. Not good for HP and it's likely to become a major distraction for the firm. Watch this space.
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