There is enough evidence to indict Hewlett-Packard (HP) staff over an internal inquiry into media leaks, California's attorney general has said.
Bill Lockyer added he could also press charges against private contractors hired by the company for the probe.
The news came as HP chairwoman Patricia Dunn stepped down amid criticism for her part in the scandal.
Ms Dunn apologised for the unorthodox investigation of other board members as she announced her resignation.
The company drew widespread criticism for the methods used in the inquiry - which included hiring undercover consultants.
"We currently have sufficient evidence to indict people both within HP as well as contractors on the outside," California's attorney general said in an interview on US television.
"Crimes have been committed. People's identities being taken falsely is a crime," he added.
"People gaining access to computer records that have personal information, in California, that's a crime."
In a bid to discover which employee had leaked "confidential" reports to the press, investigators obtained the phone records and other data of journalists and HP employees without their permission.
The practice, known as "pretexting", is a common one among private investigators, but tests the limits of California state laws, as prosecutors believe it violates laws covering identity theft and unauthorised access to computer data.
News of the possible indictments are the latest twist in the saga at the firm.
A Congressional committee has already ordered HP to hand over records related to its internal inquiry into boardroom leaks.
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