HP is suing ex-CEO Mark Hurd a day after he was hired by Oracle, saying he cannot serve as Oracle's co-president without violating a confidentiality clause in his severance package.
Hewlett-Packard reportedly is suing former CEO
Mark Hurd to stop him from taking a position with rival Oracle.
HP sued Hurd Sept. 7 in the Superior Court of California in Santa
Clara after Oracle officials announced Sept. 6 the company
was hiring
Hurd as co-president. Hurd signed a confidentiality agreement with HP as
part of his $40 million severance package, and HP officials said they do not
believe he can honor that agreement if he takes a position with Oracle.
According to the Wall
Street Journal, Hurd's severance package includes an agreement stating that
during a two-year period Hurd cannot disclose sensitive information related to
HP. However, the agreement doesn't contain a noncompete clause, according to
the WSJ.
"Mark Hurd agreed to and signed agreements designed to
protect HP's trade secrets and confidential information," HP said in a
statement. "HP intends to enforce those agreements."
Oracle is increasingly competing with HP in such areas as
software and now servers and storage, following its $7.4 billion acquisition of
Sun Microsystems earlier in 2010.
Oracle is looking to grow from a software vendor into a
full-service IT vendor, which will bring it into closer competition with the
likes of HP and IBM.
Analysts say Hurd can help the database software maker with
that growth thanks to his experience running HP, a large IT vendor with an
array of products and one that acquired and integrated a number of companies
during his five years at the helm.
Hurd resigned from HP Aug. 6 after a former contractor accused
him of sexual harassment. Though an internal investigation found no grounds for
the sexual harassment claim-and the contractor, Jodie Fisher, said she has
settled her complaint with Hurd for an unspecified amount of money-HP officials
and board members did find that Hurd falsified some expense reports to cover up
his personal relationship with Fisher.
The board said the fudged expense reports violated HP business
policies.
Four days later, Oracle CEO
Larry Ellison, a close friend of Hurd, blasted
the HP board in an e-mail to the New York Times, saying letting Hurd go was
"the worst personnel decision since the idiots on the Apple board fired
Steve Jobs many years ago. That decision nearly destroyed Apple and would have
if Steve hadn't come back and saved them."
Ellison wrote, "In losing Mark Hurd, the HP board failed to act in the
best interest of HP's employees, shareholders, customers and partners."
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