HP 2009 Annual Report Download - page 156

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 18: Litigation and Contingencies (Continued)
amended judgment reflecting those awards. On June 2, 2009, the court entered a final amended
judgment reflecting the total amount of damages, pre-judgment interest and taxable costs. On June 4,
2009, HP filed an amended notice of appeal.
Fair Labor Standards Act Litigation. As described below, HP is involved in several lawsuits in
which the plaintiffs are seeking unpaid overtime compensation and other damages based on allegations
that various employees of EDS or HP have been misclassified as exempt employees under the Fair
Labor Standards Act and/or in violation of the California Labor Code or other state laws:
•Cunningham and Cunningham, et al. v. Electronic Data Systems Corporation is a purported
collective action filed on May 10, 2006 in the U.S. District Court for the Southern District of
New York claiming that current and former EDS employees involved in installing and/or
maintaining computer software and hardware were misclassified as exempt employees. Two other
purported collective actions, Steavens, et al. v. Electronic Data Systems Corporation, which was
filed on October 23, 2007, and Azar v. Electronic Data Systems Corporation, which was filed on
February 20, 2009, are also now pending in the same court alleging similar facts.
•Heffelfinger, et al. v. Electronic Data Systems Corporation is a class action filed on November 2006
in California Superior Court claiming that certain EDS information technology workers in
California were misclassified exempt employees. The case was subsequently transferred to the
U.S. District Court for the Central District of California, which, on January 7, 2008, certified a
class of information technology workers in California. On June 6, 2008, the court granted the
defendant’s motion for summary judgment. The plaintiffs subsequently filed an appeal with the
U.S. Court of Appeals for the Ninth Circuit. Three other purported class actions originally filed
in California Superior Court, Jameson, et al. v. Electronic Data Systems Corporation, which was
filed on July 16, 2008, Karlbom, et al. v. Electronic Data Systems Corporation, which was filed on
March 16, 2009, and George, et al. v. Electronic Data Systems Corporation, which was filed on
April 2, 2009, are pending in the U.S. District Court for the Central or Southern District of
California alleging similar facts.
•Mathias v. Hewlett-Packard Company is a purported collective action filed on August 21, 2009 in
the United States District Court for the Northern District of Georgia, Atlanta Division. The
lawsuit alleges that Mathias represents other similarly situated employees who were misclassified
as exempt employees.
The United States of America, ex rel. Norman Rille and Neal Roberts v. Hewlett-Packard Company,
et al. In 2004, two private individuals filed a civil ‘‘qui tam’’ complaint under the False Claims Act in
the United States District Court for the Eastern District of Arkansas containing generalized allegations
that HP and several other companies participated in an industry-wide practice of using partnership and
alliance programs to make improper payments and cause the submission of false claims in connection
with contracts to provide products and services to the federal government. On April 12, 2007, the U.S.
Department of Justice intervened in the qui tam action and filed a complaint against HP (and several
other companies in separate actions) on behalf of the United States containing allegations that HP
violated the False Claims Act and the Anti-Kickback Act of 1986 by providing millions of dollars in
kickbacks to its alliance partners, including ‘‘influencer fees’’ and ‘‘new business opportunity rebates.’’
The U.S. complaint further alleges that HP violated the False Claims Act and the Anti-Kickback Act,
breached its federal government contracts, induced the federal government to make payments to HP
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