HP sues Mark Hurd for breaking trade secret agreements

A month ago, HP CEO Mark Hurd, resigned after a sexual harassment investigation, and just recently the same Mark Hurd was hired as the co-President at Oracle. HP, however, has a large issue with Hurd's new position claiming that he agreed and signed documents to protect HP's trade secrets and information.

HP is looking to enforce the agreements especially after Hurd was paid millions of dollars in a combination of cash, stocks, and stock options to protect HP's trade secrets. HP has filed a civil complaint to the Superior Court of California against Mark Hurd. 

The introduction to the complaint can be found on Scribd and it describes HP's issue with Mark Hurd:

“Despite being paid millions of dollars in cash, stock and stock options in exchange for Hurd’s agreements to protect HP’s trade secrets and confidential information during his employment and following his departure from his positions at HP as Chairman of the Board, Chief Executive Officer, and President, HP is informed and believes and thereon alleges that Hurd has put HP’s most valuable trade secrets and confidential information in peril.  Hurd accepted positions with Oracle Corporation (“Oracle”), a competitor of HP, yesterday as its President and as a member of its Board of Directors.  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.”

HP is looking to protect its trade secrets, rightfully so, and will do so at any cost. 

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HP is basically saying that Hurd has a no-compete clause in his contract dating from his time on HP's BoD (which no director had ever had, including his predecessor, Carly Fiorina!), therefore, he cannot accept a similar position at another company in the same field (such as Oracle). If Hurd did (which I doubt, if Ellison and/or Oracle's general counsel did their due-diligence, they would have uncovered one). then shame on *him*. Since HP did not acquire NCR, then Hurd's NCR contract would not apply to his position at HP (or even at Oracle). That is the real issue.

I don't understand things like this, why does HP think Mark Hurd cannot do his job at Oracle without using/disclosing HP trade secrets? Did HP teach him everything he knows? Does HP run Oracle and know exactly what is needed for his new position? Who says he cannot do his new job without using HP trade secrets?

Nagisan said,
I don't understand things like this, why does HP think Mark Hurd cannot do his job at Oracle without using/disclosing HP trade secrets? Did HP teach him everything he knows? Does HP run Oracle and know exactly what is needed for his new position? Who says he cannot do his new job without using HP trade secrets?

It's not that he will use the "trade secrets" but he probably has valuable information and insight regarding HP product offerings, roadmap information, service agreements, customer information (and no, not individual customers, we're talking about multi-million dollar agreements), etc....

To be successful, a president must be mindful of the environment (economic, competitive, etc.) in which their business operates, and thus it is helpful to be able to guess what your competitors are working on... so that your company can do it better (or just keep up). In his position, Oracle doesn't need to worry about guessing... it is probable that Mr. Hurd already knows. Whether he uses this to give Oracle an (un-fair) advantage, is his decision. And it is in HP's best interests to combat this possibility.

Nagisan said,
I don't understand things like this, why does HP think Mark Hurd cannot do his job at Oracle without using/disclosing HP trade secrets? Did HP teach him everything he knows? Does HP run Oracle and know exactly what is needed for his new position? Who says he cannot do his new job without using HP trade secrets?

That's kind of the point of the law suit, HP is going to have to prove it, which I believe they can do

Chsoriano said,

It's not that he will use the "trade secrets" but he probably has valuable information and insight regarding HP product offerings, roadmap information, service agreements, customer information (and no, not individual customers, we're talking about multi-million dollar agreements), etc....

To be successful, a president must be mindful of the environment (economic, competitive, etc.) in which their business operates, and thus it is helpful to be able to guess what your competitors are working on... so that your company can do it better (or just keep up). In his position, Oracle doesn't need to worry about guessing... it is probable that Mr. Hurd already knows. Whether he uses this to give Oracle an (un-fair) advantage, is his decision. And it is in HP's best interests to combat this possibility.

Thats the thing, HP is ASSUMING he will use that information against him, IMHO until they prove that he has used that information or plans to use that information against them, they have no basis to sue him. Basically, HP is saying, since you help a high position in this company, you are not allowed to work for a company in a related field. Which is complete and utter BS. No company should be able to stonewall a person to the point they cannot get a job in their field, which is exactly what HP is attempting to do.

I say dismiss the case until HP has evidence that he is planning to or already is using that information against HP.

Nagisan said,

Thats the thing, HP is ASSUMING he will use that information against him, IMHO until they prove that he has used that information or plans to use that information against them, they have no basis to sue him. Basically, HP is saying, since you help a high position in this company, you are not allowed to work for a company in a related field. Which is complete and utter BS. No company should be able to stonewall a person to the point they cannot get a job in their field, which is exactly what HP is attempting to do.

I say dismiss the case until HP has evidence that he is planning to or already is using that information against HP.

According to Engadget he personally oversaw the development of HP's business plan for the next two years including their plans to compete with Oracle in the enterprise market. I can't really see how he could un-remember that information. Don't forget that he signed multiple contracts vowing not to use any information he gained at HP and that he's a sleeze. Serves him right IMO.

Nagisan said,
I don't understand things like this, why does HP think Mark Hurd cannot do his job at Oracle without using/disclosing HP trade secrets? Did HP teach him everything he knows? Does HP run Oracle and know exactly what is needed for his new position? Who says he cannot do his new job without using HP trade secrets?

Its certainly not at all difficult to understand. If you don't get it, you clearly don't get it!

Think of it this way.......If you were playing chess for a large sum on money, would you think it was fair if your competitor knew your strategy? Keep in mind that if he has this info he could use it to counter every move you make thus increasing his chances of victory over you!

Nagisan said,

No company should be able to stonewall a person to the point they cannot get a job in their field, which is exactly what HP is attempting to do.

Which is the reason they paid him so well. He can go sit on his butt for a year then re-enter the workforce or work in a field unrelated to the field he held at HP. There have been several high profile suits like this already and the law has typically come down on the side of the binding contract.

he knows their 1-3-5 year plan, I wager. That means he can try to beat them to the punch, offer a slightly better product, or even undercut prices, supplies, etc.

Standard fare in market jobs.... usually you sign to not compete or disclose for 3-5 years after departure.

in other news, they are running scared for what he will do to them... revenge is key here.

NPGMBR said,

Which is the reason they paid him so well. He can go sit on his butt for a year then re-enter the workforce or work in a field unrelated to the field he held at HP. There have been several high profile suits like this already and the law has typically come down on the side of the binding contract.

+1

NPGMBR said,

Which is the reason they paid him so well. He can go sit on his butt for a year then re-enter the workforce or work in a field unrelated to the field he held at HP. There have been several high profile suits like this already and the law has typically come down on the side of the binding contract.

But the point is if there were any clause in his contract not allowing him to leave and go to work for a competitor. If there is such clause they have a case, if not tehy do not. You cannot put intentions or guess on trial............. not yet at least.

jakem1 said,

According to Engadget he personally oversaw the development of HP's business plan for the next two years including their plans to compete with Oracle in the enterprise market.

While I can understand HP might feel bad about this, it's two years. They can change things surely? And after two years (which will go pretty quick I should think) then they'll have nothing to moan about.

Mr Spoon said,

While I can understand HP might feel bad about this, it's two years. They can change things surely? And after two years (which will go pretty quick I should think) then they'll have nothing to moan about.

You talk like 2 years is nothing. Do you know how much money they're dealing with in a 2 year period?

There is absolutely no way this guy can do his job at the new company without using information he obtained while at HP. It's just not possible. He knows what their plans are. It gives them an unfair advantage and can destroy HP in every area they directly compete. It's crazy that they thought they could get away with that. I definitely side with HP on this one.

Skin said,
he knows their 1-3-5 year plan, I wager. That means he can try to beat them to the punch, offer a slightly better product, or even undercut prices, supplies, etc.

Standard fare in market jobs.... usually you sign to not compete or disclose for 3-5 years after departure.

in other news, they are running scared for what he will do to them... revenge is key here.


afaik Oracle does not make printers, scanners and desktops.