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CALIFORNIA ELECTIONS: U.S. Senate race

Profits may not equal success

Carly Fiorina's business experience is a mixed blessing in political realm.

May 20, 2010|Robin Abcarian

In February, a reporter for San Francisco's KGO-TV asked her about a 2001 pilot program for taxing Internet commerce that HP tested in four states with the software company Taxware International. "I have no idea what you're referring to," she replied. "We weren't running a pilot program to tax the Internet." Later that day, her spokesperson said Fiorina had forgotten about the program.

Iran embargo

The charge that Hewlett-Packard violated the U.S. trade embargo against Iran on Fiorina's watch has been raised repeatedly by DeVore.

"When she calls for sanctions against Iran, which we can certainly agree with, the hypocritical thing is that she participated as CEO in undermining those very sanctions," DeVore said in a debate.

"These accusations that we, that HP did something unlawful are false," Fiorina replied.

She's technically correct, trade law experts say. Under President Clinton's 1995 executive order banning almost all trade with Iran, Hewlett-Packard did not break the law because the sales came from a subsidiary that HP owned but which HP's American operation did not control.

For a sale to violate the embargo, an American company has to both own and control the overseas branch responsible for the sales, said attorney Victor Comras, a former senior sanctions expert for the State Department.

For The Record
Los Angeles Times Saturday, May 22, 2010 Home Edition Main News Part A Page 4 News Desk 2 inches; 58 words Type of Material: Correction
Carly Fiorina: An article in Thursday's Section A about former Hewlett-Packard CEO Carly Fiorina's quest for the Republican U.S. Senate nomination said allegations that the company had evaded the U.S. trade embargo against Iran first surfaced in a December 2008 newspaper report. Several reports had been published before then mentioning HP among companies suspected of skirting the embargo.

"What HP has been saying, and what many other companies engaged in the same kind of direct trade with Iran say is, 'We may own these subsidiaries but we don't control them,' " Comras said. "And that has been a very effective loophole. They are not technically breaking the law. But are they circumventing the law? I would think so."

Fiorina spokeswoman Julie Soderlund said the issue was first raised by Democrats in 2008, when Fiorina's name was floated as a running mate for Republican presidential nominee John McCain.

"These politically motivated allegations are false, based solely on speculative media reports," Soderlund said in an e-mail. "Redistribution of printer ink is not a national security issue."

But the first media report about HP printers in Iran was not published until nearly eight weeks after the 2008 election. Ten days after the Boston Globe broke the story on Dec. 29, HP announced it would prohibit distributors from selling its products in Iran.

"HP has a policy of complete compliance with all U.S. export laws," the company said. "Having recently examined the situation, we believe it's important to go beyond the letter of the law."

In an interview, Fiorina defended the sales.

"Hewlett-Packard complied with every export law," she said. "The facts are crystal clear. And I don't think there is anything to explain further."

robin.abcarian

@latimes.com

This is one in a series of articles examining the backgrounds of the major candidates for California governor and U.S. Senate in the June 8 primary election.

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(BEGIN TEXT OF INFOBOX)

Carly Fiorina

Political party: Republican

Occupation: Former business executive

Age: 55, born in Austin, Texas

City of residence: Los Altos Hills and Washington, D.C.

Personal: Husband Frank Fiorina; two stepdaughters (one deceased), two granddaughters

Education: Bachelor's degree in history, Stanford University; MBA, University of Maryland; M.S., Sloan School of Management, MIT

Career highlights: Senior executive, AT&T and its 1996 spinoff Lucent Technologies 1980-1999; chief executive and president, Hewlett-Packard, 1999-2005; chairman, Hewlett-Packard, 2000-2005. Only woman to have headed a Fortune 20 company.

Platform: Encourage economic growth and job creation with lower taxes, less regulation. Against abortion and same-sex marriage. Repeal and replace healthcare reform. Bring relief to Central Valley farmers by overturning water regulations protecting the delta smelt. Keep Guantanamo Bay prison open.

Campaign website: carlyforcalifornia.com

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