Hewlett-Packard settles with journalists in spying scandal

Hewlett-Packard Co. has agreed to a financial settlement with The New York Times and reporters from BusinessWeek magazine that stems from a 2006 scandal in which the company used a surveillance scheme to obtain the phone records of journalists.

The settlement, which was not the result of a lawsuit, involved one reporter from the Times and three from BusinessWeek. The scandal came about when investigators who Hewlett-Packard hired used a method called “pretexting” – calling a company and impersonating someone – in order to obtain phone records of journalists and company board members in an attempt to find out who had leaked information to the media.

The settlement included Times reporter John Markoff and BusinessWeek staffers Ben Elgin, Peter Burrows and Roger Crockett. The phone records of Markoff’s family were also sought in the scandal.

The parties settled for an undisclosed amount, but the Times donated its money to journalism efforts, including the Center for Investigative Reporting and the journalism school at the University of California, Berkeley. The BusinessWeek reporters also plan to give some of their settlement money to charity, according to Terry Gross, the lawyer representing both media outlets.

The world’s largest PC maker, however, still faces lawsuits from five other journalists and their families. Two reporters from The Wall Street Journal were also targets of the investigations, but the newspaper said it won’t take part in legal action or settlement talks.