HP embroiled in new spying row

A former HP executive accused by the company of stealing trade secrets is now saying he was instructed by the company's management to spy on rival Dell.

Karl Kamb, previously HP's vice president of business development and strategy, was named as a defendant in a federal lawsuit filed by HP in 2005. It alleges that one-time HP employees illegally started a rival flat-screen TV company while still working at HP and it is claiming up to $100m in damages.

Kamb, who has denied any wrongdoing, filed a countersuit in US District Court for the Eastern District of Texas last week, according to legal documents. Among Kamb's allegations are:

• In 2002, HP hired Katsumi Iizuka, a president of Dell Japan until 1995, to supply information on Dell's plans to enter the printer business.

• That "senior HP management" signed off on the payments to Iizuka.

• HP obtained Kamb's private phone records through pretexting, the practice of obtaining information by masquerading as someone else. Among the defendants in Kamb's suit are former HP chairman Patricia Dunn and former HP attorney Kevin Hunsaker.

In a statement on Wednesday, HP denied Kamb's accusations.

HP said: "This counterclaim is wholly without merit. It's a blatant attempt to delay the prosecution of the original case... We intend to vigorously pursue our original claim and to defend ourselves against this action."

The countersuit, which seeks unspecified damages, comes only a few months after an embarrassing episode in HP's history, in which the company engaged in illegal pretexting to obtain the private phone records of journalists, employees and company board members as part of an effort to uncover a news leak on the board. Former HP chairman Patricia Dunn has been charged with four felony counts and has pleaded not guilty.

The new allegations levelled at HP by Kamb do not appear to be directly tied to the boardroom leak hunt. However, Kamb has pointed to some of the evidence that surfaced during last autumn's investigation into HP's pretexting, and a timeline indicates the company had already employed pretexting for phone records around August 2005.

Kamb is the US chief executive of Byd:sign, the flat-panel TV company he's accused by HP of founding unlawfully.

Greg Sandoval writes for CNET News.com