HP settles kickback complaint

FLOGGER OF EXPENSIVE PRINTER INK Hewlett Packard (HP) has agreed to settle with the US Department of Justice (DoJ), which accused it of skimming kickbacks off government contracts.

The DoJ originally filed a complaint with HP, Sun Microsystems and Accenture back in 2007 accusing the trio of taking millions. Now HP has settled with the DoJ, though it would not disclose the terms of the agreement. The firm also went to great lengths to try and convince everyone that privately settling with the DoJ is in no way an admission of any wrongdoing. Of course it isn't.

The case was initially filed in 2004 after a couple of whistleblowers came forward with allegations about the companies' dealings. However, it took a further three years for the DoJ to get involved.

HP said that the settlement will have a financial effect amounting to about 2 cents per share in the third quarter of 2010. HP did not say any more about its financial expectations for the rest of the quarter.

It is not known whether Sun Microsystems, which is now part of Oracle, and Accenture are working on similar deals. In the past IBM also settled with the DoJ in a similar case, having been fined over $5 million in 2007. µ