In January 2005, Hewlett-Packard’s board of directors held an off-site meeting to discuss a proposed reorganization. Days after those talks, Fiorina learned that The Wall Street Journal was working on a story about the board’s internal deliberations. In “Tough Choices,” her new memoir, Fiorina talks about her attempts to discover who’d leaked the infor­mation (an inquiry predating the probes that lead to the indictment Wednesday of former HP chairman Patricia Dunn on felony charges of illegally gathering phone numbers). She also details with surprising candor the dra­matic circumstances surrounding her dismissal a month later—and offers a insiders view of a board so dysfunctional that it would become the centerpiece of a drama that has riveted co­porate America. NEWSWEEK’s exclusive excerpts:

It is hard to convey how violated I felt. Until a Board makes a decision, its deliber­ations are confidential. Whoever had leaked the information to the Wall Street Journal had broken a bond of trust. Trust is a business imperative. No management team can operate effectively without it. I was also angry. Whoever had done this was arrogant and foolish enough to believe that their personal agenda, whatever it was, outweighed every other consideration. Per­haps they thought they would put pressure on me to reorganize the company the way they wanted. This article would now be the subject of conversation with every cus­tomer, every partner and in every manage­ment meeting. It did not help us perform; it distracted us from performance. I informed the board of the leak. I said this was completely unacceptable behavior by a Board member. I convened a confer­ence call for Saturday morning. I was as cold as ice during the call. I said the Board could not operate in this way and I would not. Pattie [Patricia Dunn, who succeeded Fiorina as HP chairman] was on vacation in Bali and didn’t yet know what had hap­pened. Directors Jay Keyworth, Dick Hackborn and former Director Tom Perkins all acknowledged that the re­porter had contacted them. They all denied they had spoken with her. Jay, in particular, launched into a detailed defense of why the leak couldn’t possibly have come from him.

Other directors expressed shock and out­rage. Was the room bugged? I assured them that I always had the rooms electronically swept by our security personnel. Could anyone have found the large sheets of easel paper I’d written on to document our agreements? I’d shredded them myself. Director Larry Babbio said every Board member should immediately resign, and I should determine who would stand for reelection in March. I suggested that we ask the Nominating and Governance Com­mittee to launch an investigation to be con­ducted by outside counsel. The committee was convened by telephone ten minutes lat­er. The members agreed that outside counsel Larry Sonsini would interview each Board member. Director Bob Knowling requested that Larry use the interviews to conduct not only an investiga­tion, but also an objective assessment of the Board. I didn’t expect anyone to resign over this, nor did I intend to ask. I thought this could be a useful wake-up call to sever­al Board members who were not as smart as they thought they were. In turns out I wasn’t as smart as I needed to be. Somehow, at some point during the next two weeks, certain Board members would de­cide to fire me.

Related Story

Fast Chat: Fiorina’s ‘Choices’

At home on Sunday, February 6, 2005, I prepared for Monday’s Board meet­ing. Ten days earlier, on our last Board call, attorney Larry Sonsini had reported on his investigation into the leak and his assess­ment of the Board’s dynamics. He informed us that two, possibly three, Board members had leaked confidential Board conversa­tions. His report named only one member, because only Tom Perkins was honest enough to admit that he’d spoken to the press, although he was adamant that he had been a “second source.” Larry Sonsini’s report had also de­scribed the Board as “dysfunctional” in im­portant ways. I agreed with this assess­ment, and I knew others did, as well; navi­gating through the thicket of personalities, ambitions and emotions had become both draining and counter productive. Some Board members’ behavior was amateurish and immature. Some didn’t do their home­work. Some had fixed opinions on certain topics and no opinion at all on others. Some members were bored and distracting during important agenda items like leader­ship development or corporate social re­sponsibility.

After Larry had finished making his re­port, we’d turned our attention to the annu­al shareholders meeting, which was also our next scheduled Board meeting. Were we still committed to the strategy? Were we going to reorganize, perhaps in preparation for the split-up of the company that many detractors were calling for? And so we de­cided to schedule a special February Board meeting to align our thinking and prepare our responses. To prevent any more press speculation about our activities, we’d cho­sen the Chicago airport, rather than Palo Alto headquarters, as our location.

I was mystified by the Board’s recent be­havior. I was suspicious of Jay’s heated de­nials when the leak first occurred and then his complete silence on our last call. And I was gravely concerned by the lack of con­tact from any Board member since our last phone call more than a week earlier. Larry Sonsini told me that various Board mem­bers were talking to one another. What had they talked about in those intervening ten days? Why did they feel it necessary to ex­clude me?

And so I was tense and pessimistic on that Sunday. Some might wonder why I did not take it upon myself to call every single Board member and plead for my job or de­mand an explanation or make amends, but those ten days were filled from morning to night with all the commitments and deci­sions and actions that came with being a CEO. Beyond that, I didn’t think it was my role to talk the Board into or out of a partic­ular course of action. I was accountable for my own behavior and decisions. The Board would have to be accountable for theirs. My husband, Frank, kept telling me to stop worrying. He reminded me that just three weeks earlier Jay Keyworth had been planning the May Board meeting on our boat. (Soon after Jay’s wife died, he’d asked if he could bring his grandson to Cal­ifornia and stay with us. Frank had enter­tained them for two days, and Jay had loved Frank’s boat.) My husband remembered his conversation with Pattie that same evening. Pattie and her husband were both semiretired and about to leave for their Bali vacation. Frank had been fantasizing about how great life would be once I retired, and Pattie had responded, “Sorry, Frank. En­couraging Carly’s retirement is against my fiduciary duty.”

He could not convince me. I knew my anxiety was justified. There was to be no conversation the next day. When I arrived in the meeting room, the dynamics were clear. Despite his long-term disdain for her, I now saw Jay whispering in Pattie’s ear and laughing with her at some private joke. Pattie kicked the meeting off. This in itself was strange. She was not the chair of any committee. Everyone but me seemed to know what was about to happen.

Larry Sonsini mentioned a meeting that had apparently taken place the night before between some Board members and a gov­ernance expert. I hadn’t been made aware of it or invited to it, despite my role as chairman of the Board. It was as if I weren’t in the room at all. No one would look me in the eye. And then Pattie said, “Carly, do you have anything to say?”

I was startled. This wasn’t going to be a conversation; apparently the Board wanted a statement. I had made copies of a docu­ment I’d prepared the day before so now I passed them around the table. I expressed regret that a formal statement was neces­sary but also understood that clarity was now paramount. I began to read, hoping to be interrupted. I conveyed my respect for and appreciation of the Board’s role. They had hired me and they could fire me. I con­veyed my agreement that healthy debate was paramount: if I was preventing open communication in some way, I wanted to acknowledge it. I wanted to bring clarity to the table after a series of damaging and emotional events.

I finished reading, hoping to be asked a question. I was met with complete silence. And then Pattie asked me to leave the room. Having traveled two thousand miles, I was dismissed in about twenty-nine min­utes.

It would be three hours before I would be asked to return to the conference room. I knew that every leader has a season, and as I sat in that hotel room I realized that my season was perhaps coming to an unex­pected and abrupt end for reasons I did not understand. And yet I expected the Board to look me in the eye and tell me why. They did not have the courage to face me. They did not thank me and they did not say good-bye. They did not explain their decision or their reasoning. They did not seek my opinion or my involvement in any aspect of the transition. When I finally received the call to rejoin the meeting, I thought about each Board member as I rode the elevator down past those twenty-four floors. I didn’t know what to expect, but I assumed I would be facing them. I wasn’t prepared for the empty conference room I entered.

When I opened the door and realized all but two Board members had already left, I knew I had been fired. When Bob Knowl­ing said, “The Board has decided to make a change. I’m very sorry, Carly,” I knew he had opposed my ouster. When Pattie, who had become the new chairman of the Board, said they wanted to make an an­nouncement immediately, I realized I would not be treated like other CEOs. The meeting lasted less than three minutes. I asked for a few hours to think, and I left the room.

When I returned to my hotel room less than ten minutes after I’d left, my hands shook from the shock. Tears came to Frank’s eyes. He truly had never believed this could happen.

Pattie had asked for my help in “posi­tioning” the shocking news. She said the Board thought I should announce this as my decision. I should say I’d decided it was “time to move on.” I believe the truth is al­ways the best answer, whatever the conse­quences. Less than two hours after I left the room, I sent a message to the new chair­man saying we should tell the truth: the Board had fired me.

I was utterly devastated, but the next day the sun still came up and life went on. That day, and in the days that followed, I was more hurt than angry. I felt a curious mixture of sorrow and relief. I had worked so hard for so long; I had thought about the company constantly; I’d put everything on the line, and now suddenly it was over. I thought about my team and longed for the opportunity to gather them together and thank them and wish them well. I thought about the people of a company I had grown to love, and I ached for the chance to say good-bye and reminisce, one last time, about the remarkable journey we had taken together. I was never given the chance. I was pressed to accept another job im­mediately. There were many wonderful and flattering opportunities. In our society activity is frequently interpreted as signifi­cance, and I was advised by some to jump back into the fray. The wiser counsel was to take the time to rediscover life. And so I chose to pause and reflect.

As weeks became months I asked myself over and over what had happened. Were there signals I’d missed? Was there some­thing I should have said or done that would have made the difference? Despite the ear­lier objections of some Board members to the idea, I had been planning to hire a con­sultant to work with the Board on the com­munications issues and “dysfunction” that clearly existed. What if I had done this sooner? Having counted on my strength to complete a very difficult merger and drive the successful transformation of a compa­ny against great odds, did Board members now resent that same strength when I used it to reject their suggestions and condemn behavior like sharing Board room conver­sations with the Wall Street Journal? Or did they simply conclude they didn’t need me anymore?

I received a letter from Pattie Dunn in which she expressed her admiration for my leadership—“you will remain a hero”—and regret that her role had been “miscon­strued” by the press. She would not give me permission to publish the letter, fearing that it would be used in “a context that would reflect negatively on [her] and/or the Board.” I received a letter from Tom Perkins. He granted me permission to pub­lish it:

I miss seeing you and I hope that you are well along in mapping out your next ca­reer move. If it should be to seek an elected office, I would be honored if you would let me participate on the fundraising side. Probably we will never agree on what happened at HP, but I would like you to know that I, personally, think you moved the company forward in giant steps in the Compaq acquisition and in the consolida­tion of the two businesses. Today’s HP wouldn’t have the potential it clearly has, if you hadn’t made those moves. I have never heard from Dick Hackborn or Jay Keyworth.

The year 2005 did turn out to be the payoff year I’d expected. The economy con­tinued to gather strength all over the world. HP performed magnificently and delivered the plan. I was proud of the management team and the people of HP. The company’s 2005 results finally demonstrated that HP had indeed been transformed.

Life isn’t always fair, and I was playing in the big leagues. Yet I realized I had no re­grets. I had completed my mandate. I had made mistakes, but I had made a differ­ence. I had given everything I had to a com­pany and a cause I believed in. I had made tough choices, and I could live with their consequences. While I grieved for the peo­ple and the purpose I had lost, I did not grieve for the loss of my soul.

From “Tough Choices” by Carly Fiorina. To be published by Portfolio, a division of Penguin Group (USA). © 2006 by Carly Fiorina.