See You in Court

It is the biggest court battle over election results since the Florida recount and it all began today in Wilmington, Delaware where Hewlett-Packard (HWP) is incorporated.

The "he-said", "she-said" pits dissident shareholder Walter Hewlett against HP CEO Carly Fiorina in a case that should decide once and for all the fate of the company's $19 billion merger with Compaq (CPQ).

Cameras were not allowed in the courtroom, but Fiorina spent the entire day on the witness stand fielding questions about how she canvassed for votes in favor of the merger. At the heart of this case are accusations that Fiorina engineered a last minute shift of 17 million shares voted in her favor, in return for making Deutche Bank co-manager of a huge bond offering from the company.

Furthermore, lawyers for Walter Hewlett also presented several documents that showed both HP  and Compaq management had doubts about their rosy projections for the combined company, almost all along.

One memo from Compaq CEO Michael Capellas entitled "sobering thought," warned, "at our course and speed we will fail."

In its opening arguments HP dismissed the allegations telling the judge that, "the evidence will show that Walter Hewlett has dragged Hewlett-Packard and its officers through the mud..."

That may be the case, but this marriage has been star-crossed since it was announced back in early September. Since then, the value of the combined company has plunged by more than $6 billion.

The hearing is expected to last about three days, but it is not the only hurdle Carly Fiorina is facing. The Securities and Exchange Commission is now also getting involved in the vote, launching an investigation into Mr. Hewlett's charges.