By GEORGE ANDERS and ALAN MURRAY
October 9, 2006; Page A1
PALO ALTO, Calif. -- Within weeks after her unexpected ascension to the chairmanship of Hewlett-Packard Co. last year, Patricia Dunn found herself in open warfare with another director: wealthy venture capitalist Tom Perkins.
They argued over how the board should be run. He has called her a "stickler for process and procedure." She says he was a "controller." For new board members, he pushed for Silicon Valley entrepreneurs with ties to his venture firm. She rejected his suggestions in favor of big-company leaders from other industries.
They even bickered over Mr. Perkins's steamy novel, "Sex and the Single Zillionaire," which he wrote with the encouragement of his ex-wife Danielle Steel. The 74-year-old Mr. Perkins says he jokingly called for all H-P employees to buy the book. Ms. Dunn, 53, says she didn't hear anything playful in his tone and vetoed that plan. When Ms. Dunn told Mr. Perkins at a party that the book "isn't my thing," he angrily accused her of embarrassing him in public.
At heated moments, two witnesses say, Mr. Perkins would declare in front of board members: "We need a new chairman." Ms. Dunn says at other times he would poke her in the clavicle and say: "I made you chairman." Mr. Perkins's actions were, in the words of another director, former Medtronic Inc. executive Robert Ryan, "chairman abuse."
The clash between Ms. Dunn and Mr. Perkins lies at the root of the spying scandal at H-P, a saga that ended catastrophically for Ms. Dunn. Last week the California attorney general charged her on four felony counts of fraud and conspiracy, saying she led the H-P board into criminal violations of privacy when the company pried into personal phone records to investigate boardroom leaks.
The Journal's Alan Murrayand BusinessWeek's Lorraine Woellert discuss weekend interviews given by former H-P CEOs Patricia Dunn and Carly Fiorina, and question whether the female executives were held to different standards.
Murray discusses the risks Dunn may face by testifying before Congress.
Mr. Perkins set the charges in motion by storming off the board and alerting authorities to the phone snooping. He contacted the Securities and Exchange Commission and California's attorney general, pressing them to take action. But their fight was much broader than that, reflecting a fundamental conflict over how to run big companies in the post-Enron world.