HP and its shareholders have much more pressing matters to attend to than digging up old skeletons and revisiting the situation that led to former CEO Mark Hurd's resignation. Or at least you would think that would be the case. Instead, the Delaware Supreme Court is being asked to decide whether to unseal a letter from an actress' lawyer that ultimately led to Hurd's departure amid allegations of sexual harassment, the Associated Press reports.
With the economy in the crapper, a lot of folks are buckling down, tightening their belts and saving money any way possible. Not HP. No, we’re not talking about the company’s $10.3 billion acquisition of Autonomy; we're talking about the cash HP’s shelled out in severance packages to ousted revolving-door CEOs the past few years. One website counted up the dollars and cents and came up with an astonishing figure: those golden parachutes cost HP around $80 million.
The controversial letter that marked the beginning of the end for Mark Hurd’s five-year reign as Hewlett-Packard’s CEO is about to be made public. The public release of the missive accusing Hurd of sexual harassment was ordered late Thursday by Delaware Chancery Judge Donald Parsons in a shareholder lawsuit against HP (Ernesto Espinoza v Hewlett Packard Co, Delaware Chancery Court, No. 6000).
Well, that was a lot of bluster for nothing. Shortly after former HP CEO Mark Hurd accepted a job at Oracle, HP filed suit claiming Hurd would have no choice but to divulge confidential HP information in his new position. Today, the two companies have announced that they've settled their differences out of court, and Hurd would be taking the position at Oracle. However, Hurd will apparently be keeping that secret HP stuff a secret.
The statements from the company were the usual sort of glad-handing you see when companies come to a grudging agreement. Details of the settlement were not available, but we'd wager Oracle paid HP a pittance, and HP agreed not to pursue that un-enforceable non-compete clause. Despite their positions as competitors in corporate IT, the two companies have worked together extensively to serve their shared customers.
What do you think went on behind closed doors? Did anyone come out ahead in this deal?
Hewlett-Packard, which recently trumped Dell in a fierce bidding war for data storage company 3PAR, is now said to have cybersecurity firm ArcSight in its sights. According to a Wall Street Journal report, citing anonymous sources, a deal could be announced as early as Monday. The report suggests that the deal could be worth around $1.5 billion, but that is just speculation. The Journal had earlier identified HP, Oracle and IBM as potential suitors for the the Cupertino-based enterprise security management company that boasts more than 1,000 customers around the world.
As HP stands firm in their lawsuit against former CEO Mark Hurd, legal experts are indicating HP will likely be unsuccessful. HP is seeking to block Hurd from taking a job at rival firm Oracle. The two companies compete in the business sector, and HP says Hurd signed agreements to keep HP's trade secrets confidential. HP contends this should bar him from working at a competitor.
The sticking point for HP is that the case is taking place in California, whose courts traditionally favor letting employees move freely. To win the case, HP would have to prove that Hurd's knowledge would provide Oracle with an unfair competitive advantage. This is unlikely to happen.
Oracle CEO Larry Ellisoin has, of course, weighed in and called the lawsuit "vindictive". Whatever the outcome, the relationship between Oracle and HP is probably going to be difficult.
HP's former President and CEO Mark Hurd was forced out in the wake of a scandal which may or may not have involved a romantic relationship with a contractor. What it did involve was filing bogus expense reports. Hurd left, and got a pretty smashing severance package. HP may have been planning to let things lie, but with the news that Hurd intends to join Oracle, HP is willing to go to court.
HP claims that Hurd signed agreements to protect HP's trade secrets, and his work at Oracle would break those agreements. HP's complaint reads in part, "In his new positions, Hurd will be in a situation in which he cannot perform his duties for Oracle without necessarily using and disclosing HP’s trade secrets and confidential information to others."
This story is still developing, but it looks like it won't be smooth sailing for Mark Hurd after all. It is common for companies to enforce so called "non-compete" agreements when high-level executives leave. Check out the source link to download the full documents if you fancy some legal reading.
He was in the crosshairs at the start of this year when his mistress of eight years YaVaughnie Wilkins went public with their affair using a billboard campaign. Phillips is also a member of President's Economic Recovery Advisory Board.
His replacement, Mark Hurd, is no stranger to controversies either. It was a sexual-harassment probe that led to Hurd's exit from HP. "Mark did a brilliant job at HP and I expect he'll do even better at Oracle," said CEO Larry Ellison in a statement,” said Oracle CEO Larry Ellison in a statement.
At the time of Hurd's departure from HP, Ellison was critical of of the role HP's board payed in Hurd's exit. In an email sent to the New York Times, he had called it the “the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago.”