Wednesday, April 18, 2007, 4/18/2007 09:55:00 AM

Fired Wal-Mart Security Operative Denies He Stole Trade Secrets or Provided Them to the Wall Street Journal

By Todd
Portfolio Media is reporting that fired Wal-Mart Stores Inc. security operative Bruce Gabbard denied that he had provided company secrets to the press in court papers filed on Monday. Gabbard, who was fired by Wal-Mart last month, filed a brief two-paragraph notice in Arkansas circuit court claiming that he had not revealed company secrets in a Wall Street Journal interview published two weeks ago. It is possible he may provide more information at a later date.

The suit suggested that Gabbard might still have Wal-Mart documents, and asked the court to order him to surrender a list of “all home and work computers, personal digital assistants, hard drives, thumb drives and all other electronic and digital media and hardcopy information.” It also asked the court to order Gabbard to provide Wal-Mart lawyers with “the names of all persons to whom he has transmitted, since January 15, 2007, any Wal-Mart information.”

On Friday, Judge John R. Scott granted Wal-Mart’s request to take custody and make electronic copies of all computers, hard drives and other storage devices Gabbard had used. The judge had previously granted Wal-Mart’s request to stop Gabbard from talking to any more reporters, court papers said. The company filed a lawsuit and request for a temporary restraining order against Gabbard in the Arkansas Circuit Court in Benton County on April 6.

On April 9, the suit and Judge John R. Scott’s order granting the gag request became part of public file. Wal-Mart fired Gabbard in March after he intercepted workers’ pager messages containing sensitive information and taped a call between employees and a New York Times reporter. Gabbard, who had been with the company for 19 years and was part of a security team called the Threat Research and Analysis Group, told the Wall Street Journal that the project to intercept pager messages was authorized. He admitted that he didn’t get authorization to record calls between employees and the reporter, but said his actions were a result of pressure from the head of Wal-Mart’s office of global security, Kenneth Senser.

Last week, Gabbard talked to reporters from the Wall Street Journal, outlining the Threat Research and Analysis Group’s activities—including sending an undercover operative to spy on protest groups and hacking into the Web sites of activist investors. According to Wal-Mart, Gabbard violated trade secrets law by revealing “confidential information about Wal-Mart security systems and operations” and “highly confidential information about Wal-Mart’s strategic planning.” Gabbard told the Journal that Wal-Mart considered its activist shareholders potential threats and was engaged in a super-secret “Project Red” that aimed to bolster its sagging share price.Gabbard was part of the security team for Project Red and was responsible for encrypting data and reports and creating passwords.

About Project Red, Wal-Mart said, “Our senior management, our board and their advisors regularly conduct thorough, strategic reviews of all aspects of our business.”“That’s just good governance. We look at a full range of alternatives, many of which are considered and rejected, and we will not comment specifically on any of them,” the company added.

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