HP Can Investigate Hurd Legal Issues, Judge Rules

 
 
By Chris Preimesberger  |  Posted 2011-01-24
 
 
 

A federal district judge in San Jose, Calif., ruled Jan. 24 that a Hewlett-Packard internal investigation of the displacement of former CEO Mark Hurd in August 2010 may proceed, even though Hurd himself wanted to have it delayed.

The investigation by four new members of the HP board was sparked by a shareholder lawsuit after Hurd was forced to resign Aug. 6, 2010, following sexual-harassment allegations by former HP contractor Jodie Fisher.

U.S. District Judge James Ware threw out Hurd's objection to the investigation and said it could proceed. In the court affidavit, Hurd claimed he has a right to see personnel documents about his case; HP's board disagreed, as did Judge Ware.

Hurd said he wanted to see a copy of the shareholder demand that caused the forthcoming investigation. HP said in its response to the court that Hurd, as a "potential subject of the inquiry," isn't entitled to the documents.

Judge Ware, in agreeing with HP, scheduled a new hearing in March, requiring an "update on the investigation" beforehand, court documents said.

No evidence of harassment found

At the time Hurd left the CEO position last August, according to HP, no evidence of sexual harassment could be found. Both Hurd and Fisher have said that there was no sexual relationship between them. But HP also claimed that Hurd had violated company business policies through filing false expense reports to cover up a personal relationship between the two. Hurd and Fisher eventually settled their dispute out of court.

Immediately after Hurd left, HP's stock took a nosedive, angering a number of shareholders. Later, several key shareholders were upset to learn that Hurd may have collected a severance package that was valued at up to a whopping $53 million-money the plaintiffs described as "corporate waste" in their filings.

Hurd, while controversial at times and not particularly well-liked by HP employees, nonetheless was an effective administrator who, during his five-year tenure, kept corporate costs in line and helped in a big way as HP surpassed IBM to become the world's largest IT company.

Thirty days after leaving HP, Hurd was hired by Oracle co-founder and CEO Larry Ellison, who promptly named him co-president of the company and chastised the HP board for letting him go.

As is apparent, Hurd was a major target for litigation in 2010. Go here to see a story listing his legal entanglements.

Rocket Fuel