HP Drops Lawsuit Against Hurd After Mere 13 Days

 
 
By Chris Preimesberger  |  Posted 2010-09-20 Email Print this article Print
 
 
 
 
 
 
 

Former HP CEO gives up about $30 million in severance from HP to work for Oracle as co-president.

SAN FRANCISCO-Well, that didn't take long.

In an era in which legal cases are often drawn out far longer than they should be, Hewlett-Packard and Oracle spent only 13 days in a legal tussle over the move of former HP CEO Mark Hurd to Oracle to serve as its co-president.

On Sept. 20, HP dropped a civil lawsuit it had brought Sept. 7 against Hurd accusing him of violating a noncompetition agreement in his HP contract by joining Oracle a mere 30 days after accepting a $40 million severance package.

Hurd, who participated in a morning keynote session at Oracle Open World here at the Moscone Center, did not so much as mention HP during his brief remarks.

HP said in a corporate statement the two companies had reaffirmed their longtime partnership. The bottom line is that Hurd will be working full time for Oracle, but since Oracle and HP are closely aligned on several key projects-such as cloud computing-they also will be strategic partners.

Terms of the settlement are confidential, but HP said Hurd will "adhere to his obligations to protect HP's confidential information while fulfilling his responsibilities at Oracle."

Hurd agreed to waive his rights to 330,177 performance-based restricted stock units granted to him in a 2008 separation agreement with HP, as well as 15,853 time-based restricted stock units, HP revealed in an 8-K filing with the Securities and Exchange Commission.

That's not trivial. Based on the Sept. 20 HP stock price, Hurd is giving up about $30 million in severance.

Hurd won't be hurting for income, however. Earlier, Oracle said Hurd would be paid $950,000 in annual salary and will be eligible for as much as $10 million in performance-related bonuses during the next year.

Back to business as usual

Oracle and HP have made it no secret at Oracle OpenWorld that they are going to continue to do plenty of business together, despite the brief legal action.

Hurd was forced to resign as HP's CEO Aug. 6 following a sexual harassment allegation by a former HP employee and that led to reports that he falsified financial records to cover up a relationship with that employee. Hurd, a longtime friend of Oracle CEO and co-founder Larry Ellison, was hired Sept. 6 at Oracle.

At the time HP filed the suit, Ellison described the legal case "vindictive" and chided HP's board of directors for forcing Hurd out, saying it was "the worst personnel decision since the idiots on the Apple board fired Steve Jobs."

A number of industry analysts also expressed doubt about the wisdom of letting go a chief executive who brought the company back from wandering in the wilderness a mere five years after it was stumbling following several huge bad decisions-not the least of which was buying Compaq.

"The civil suit ... is kind of funny, because it's almost like a necessary step in the corporate tango," Mark Peters of Enterprise Strategy Group told eWEEK at the time. "I don't think the civil suit is about a particular technology or market secrets; it's more about [the fact that] they don't want this smart manager going somewhere else."

 
 
 
 
Chris Preimesberger Chris Preimesberger was named Editor-in-Chief of Features & Analysis at eWEEK in November 2011. Previously he served eWEEK as Senior Writer, covering a range of IT sectors that include data center systems, cloud computing, storage, virtualization, green IT, e-discovery and IT governance. His blog, Storage Station, is considered a go-to information source. Chris won a national Folio Award for magazine writing in November 2011 for a cover story on Salesforce.com and CEO-founder Marc Benioff, and he has served as a judge for the SIIA Codie Awards since 2005. In previous IT journalism, Chris was a founding editor of both IT Manager's Journal and DevX.com and was managing editor of Software Development magazine. His diverse resume also includes: sportswriter for the Los Angeles Daily News, covering NCAA and NBA basketball, television critic for the Palo Alto Times Tribune, and Sports Information Director at Stanford University. He has served as a correspondent for The Associated Press, covering Stanford and NCAA tournament basketball, since 1983. He has covered a number of major events, including the 1984 Democratic National Convention, a Presidential press conference at the White House in 1993, the Emmy Awards (three times), two Rose Bowls, the Fiesta Bowl, several NCAA men's and women's basketball tournaments, a Formula One Grand Prix auto race, a heavyweight boxing championship bout (Ali vs. Spinks, 1978), and the 1985 Super Bowl. A 1975 graduate of Pepperdine University in Malibu, Calif., Chris has won more than a dozen regional and national awards for his work. He and his wife, Rebecca, have four children and reside in Redwood City, Calif.Follow on Twitter: editingwhiz
 
 
 
 
 
 
 

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