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7/11/2008
05:14 PM
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Former HP Exec Pleads Guilty To Stealing IBM Secrets

Atul Malhotra is scheduled to be sentenced in October and faces a maximum penalty of 10 years in prison, a $250,000 fine, and three years of supervised release.

Former Hewlett-Packard VP of imaging and printing services Atul Malhotra on Friday pleaded guilty to the theft of IBM trade secrets.

From late 1997 until April 2006, Malhotra, 42, of Santa Barbara, Calif., was employed by IBM as a director of sales and business development in output management services for IBM Global Services, according court documents. As such, he developed bids and sold printer management services to IBM customers.

In March 2006, a month before he left IBM, Malhorta requested and received a document called CC Calibration Metrics, an internal pricing file marked "IBM Confidential." He was specifically told by an IBM Pricing Coordinator not to redistribute the information, court documents state.

In May 2006, Malhotra joined HP as VP of imaging and print services. On July 25, 2006, according to court documents, he sent an e-mail to an HP SVP with the subject line, "For Your Eyes Only." The CC Calibration Metrics document was attached.

The court filing indicates that on July 26, 2006, Malhortra also sent the same confidential file, with the subject line "For Your Eyes Only - confidential," to another HP SVP.

The legal filing doesn't say how Malhorta's unauthorized messages were detected. But perhaps using subjects lines like "For Your Eyes Only - confidential" is probably not the best way to fly below the radar.

The case against Malhortra was filed on June 27, 2008. He is scheduled to be sentenced on Oct. 29, 2008. He faces a maximum penalty of 10 years in prison, a $250,000 fine, and three years of supervised release.

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