HP Sues Hurd For Joining Oracle 301
CWmike writes "Hewlett-Packard is reported to be suing former CEO Mark Hurd, who was named co-president of rival Oracle on Monday. The Wall Street Journal first reported the news, and has now posted the full text of the suit on Google Docs. Among other things, it says, '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.'"
Well (Score:2, Funny)
The GNU this was going to happen.
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The GNU this was going to happen.
You know, I read this headline and immediately thought of GNU Hurd... And then I thought about it, and remembered that it couldn't possibly be about GNU Hurd, because GNU Hurd hasn't been relevant since... ever.
Should've kept him (Score:2)
Of course I don't know what peculiarities were in his golden parachute contract as far as how long he couldn't work for the/any competition but I doubt he didn't talk this over with some corporate lawyers at least.
In any case, if they don't like him bringing his ass(ets) over to another company, they should've kept him. Nothing much they can do about it now unless he's still under contract.
Re:Should've kept him (Score:4, Insightful)
That's pretty much it.
Unless there's a signed "non-compete" document from Hurd, HP will just have to live with their mess up.
I'd be surprised if Mr. Hurd signed such a document.
Just my $0.02
-JJS
Re:Should've kept him (Score:4, Insightful)
HP's trade secrets: (Score:5, Funny)
Secret 1: Outsource everything.
Secret 2: Employees are interchangeable.
Secret 3: Good enough is probably too expensive.
Secret 4: There is still at least enough good will for the HP name to milk another five years.
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I was only with HP for a year, and I'm glad to be rid of them.
IBM isn't perfect, but they are much better than HP at least.
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That's pretty much capitalism in a nutshell, and is the reason why everything is as durable as wet cardboard nowadays.
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bingo.
confidentiality means nothing. Really they're citing news articles as their reasoning for the suit.
what HP is trying to due here, is a: trying to make Hurd look bad and b: try to extract money from oracle by forcing them to settle. Why bother with A? I'm quite certain that if he's not found guilty he could actually sue HP for libel on this one, citing the complaint.
They're trying to claim misappropriation of trade secrets, but considering he has been at HP maybe a week? They have nothing to show for
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additional note: whether to be able to sue successfully is anyone's guess. But I wonder if he would have a libel case in such an instance.
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"confidentiality means nothing"
I'm curious why you believe this.
"I'm quite certain that if he's not found guilty he could actually sue HP for libel on this one, citing the complaint."
First, I suppose it's a bit of a technicallity, but this is a civil filing. He is not accused of a crime. There is no "guilty" or "not guilty".
Second, defamation suits are notoriously hard to win in the U.S. Filing a civil complaint that is later dismissed is not, in and of itself, at all likely to constitute libel. I would
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"confidentiality means nothing"
I'm curious why you believe this.
Probably because it's true. Once you're no longer working for the company you are no longer under any obligation to keep anything secret, unless you've agreed not to, either in writing or as a part of a verbal agreement. I used to work for a company that required all kinds of silence about just about everything. The moment I quit though, I stopped being silent about any of it. At that point there wasn't a damned thing they could do about it as I hadn't agreed to remain silent after separating from the compa
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what the hell secrets does he know besides who's in bed with who
That in itself is not worthless. However executives also know what markets the company is planning to go after, what new products just started in development, what companies may be acquired and why and for how much, and so on. This stuff is far more valuable than a schematic of a "new" inkjet.
If he hasn't signed a specific contract, where HP pays him for not working for competitors, HP can't do anything. I think this is just an intimidatio
Re:Should've kept him (Score:4, Informative)
Re:Should've kept him (Score:5, Informative)
Unless there's a signed "non-compete" document from Hurd, HP will just have to live with their mess up.
In California, non-compete agreements [wikipedia.org] have been disallowed by the courts...
May have to return part of severance (Score:3, Interesting)
In California, non-compete agreements [wikipedia.org] have been disallowed by the courts...
That may allow him to work at Oracle, barring trade secret or proprietary information issues, but it may not allow him to keep all of his severance. I think you may be able to pay a person not to work for a competitor for a reasonable time frame. They still have the right to do so but may be required to return the payment.
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I'm sure he got a signing bonus.
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I'm sure he got a signing bonus.
And I bet she is good looking.
Re:Should've kept him (Score:4, Informative)
So what? HP's own lawsuit notes that HP's "world headquarters and principal place of business" are in California, and that Hurd was employed in Santa Clara, California, the suit is filed in a California court, and seeks remedies under California law.
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That being said, this sort of bickering isn't unusual when a high ranking player leaves one company and goes to work for a competitor. See Microsoft/Google, and various others. HP will get some money a
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When I worked for a company in CA they wanted me to sign a non-compete document. I asked what would happen if I didn't want to sign it. They just told me not to sign it. I gave it back blank. It didn't affect my hiring or future employment.
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He's not competing. He's moved to a technology company. :-)
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- or he could have thought with his big head instead of his little one.
Non-disclosure/non-competes still apply after you leave - more so when you're fired for cause. You *can* challenge them if you were terminated w/o cause, but that's not the case here.
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Non-disclosure/non-competes still apply after you leave - more so when you're fired for cause. You *can* challenge them if you were terminated w/o cause, but that's not the case here.
No, they don't apply at all. Any non-compete clauses in a contract are invalidated by California law.
Re:Should've kept him (Score:4, Informative)
No, they don't apply at all. Any non-compete clauses in a contract are invalidated by California law.
That's true in the general case, but California law still allows a company to sue to prevent use of its trade secrets, which is the angle HP is taking here.
Also (Score:4, Informative)
This could have been different in that it may have been required to get his bonus. That sort of thing is almost always legal, since it is regular contract law. You come work for me, we have a normal employment agreement. However I say "You know, there's a lot of stuff you are privy to that I don't want getting out. So if I lay you off, I'll give you a big bonus, but in turn for that you can't go work for my competitors, you can't write an expose book, and so on."
Now of course you don't have to do agree to that, but if you don't, you don't get the bonus.
So while California may well say "You can't have a non-compete on normal employment," a termination bonus is a different thing.
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I find that legal reasoning interesting but have never heard it before. Are you a California lawyer? or do you know California employment law particularly well? or can you provide a source for that tidbit? I just find it a little tough to believe and would like to hear more.
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It's a contract, and it applies like any other.
The argument HP is making is not that Hurd isn't allowed to work for Oracle because of a previous agreement with HP. That would be a non-compete, and is not valid in California.
The argument HP is making is that it is impossible for Hurd to perform his new duties for Oracle without sharing HP's trade secrets, and Hurd has a contract with HP saying he will not share HP's trade secrets. In other words it's a breach of contract due to conflict of interest, not a
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There is nothing stopping the person from seeking employment with a competing company by saying "If you choose to work for a competing company within $term after contract termination, you will not receive your Golden Handshake." They are absolutely not prevented from seeking competing employment, they just have to way up the pay packet of the new job against the severance pack
Re:Should've kept him (Score:5, Interesting)
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Ellison isn't a stupid man. He is also a multi-billionaire. I'm sure he and Hurd worked out the specifics of the separation package and any signing bonus.
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Also, the agreement specifies that he will indemnify HP both for proven damages as well as statutory damages. If the courts look at the evidence from the face of the ag
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Basically at this level you hire expensive barristers and attempt to rip the other side to pieces in court – I suspect that HP will bring up all the “dirt” that they hid when Hurd
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And Hurd will be in a position to bring up all the dirt about the board and it's chairman.
This is just HP acting spitefully, IMHO.
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Trade secrets secrets separate from noncompete (Score:2)
Prior to any of said trade secrets being used? Good luck with that one...
Trade secrets and proprietary information can never be disclosed. Noncompete agreements may be null and void at the time of signing but nondisclosure agreements can last forever.
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If we accept that at the CEO level then we must accept the massive compensation packages these guys get because then they'd never be able to work. Any CEO making the big money also has the big bills which have to be paid.
And if that were the case then the middle level guy would forever be shunned unable to find work because he knows to much about the workings of the company.
There's a limit to what they can force non-disclosure on. Otherwise, it would be a one hit wonder for so many managers and executives
Skills and experience separate from trade secrets (Score:3, Insightful)
There's a limit to what they can force non-disclosure on. Otherwise, it would be a one hit wonder for so many managers and executives.
No. Trade secrets and proprietary information are off limits in perpetuity as long as the company properly identified and secured such information and continues to do so.
I think what you are getting at are the experience and general skills a person develops on the job. These are things that may be taken from job to job without restriction.
Lets say that while at HP Hurd developed personal business relationships with executives at company A. Lets say he has experience negotiating with company A. Now
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This has happened before. I think it was with some Microsoft employee living in CA that went to work for Google. I can't remember the specifics. Though they still hired the guy it was agreed that he wouldn't be used in a position that directly exposed his knowledge gained from his prior job.
In reality, though you can't limit it all. Some people need to work and some are highly specialized. It would be onerous to force people to comply with non-compete clauses (if they were valid in CA). In this case,
Re:Should've kept him (Score:4, Informative)
So Hurd can never leave California to visit an Oracle office elsewhere without being slapped with a lawsuit in another jurisdiction. Sounds like HP will enjoy that :-)
They're alleging
They cite California Civil Code 3426.2(a) [onecle.com], so no, contracts are not automatically invalidated - it depends on the terms of employment.
It's quite simple - his new job at Oracle puts him in a position where he will be violating HP trade secrets. He simply cannot work as the CEO of any large US IT company without attracting such a lawsuit.
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Re:Should've kept him (Score:4, Informative)
He got over $12 million as a separation payment in which he specifically reaffirmed that he would not work for a competitor for a year. Oracle names HP as a major competitor in the 10k SEC filing. Both he and Oracle are properly being sued already under section 3426 [onecle.com] of the California Civil Code - this would just be additional lawsuits.
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If we want to pursue the red herring further, look at the venue-shopping that went on in all the SCO litigation. (or have you forgotten that suse sued and won outside the US)?
However, Hurd is screwed under California law, so it doesn't matter. What he did
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No, it's not. Please,.for once, follow a link and read it [onecle.com] instead of believing the echo chamber that is most of slashdot's uninformed masses.
Here - since everyone is so brain-dead when it comes to actually doing any research ... he's being sued under California statute 3426.2
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Absolutely wrong. You file suit in your home jurisdiction, or in a jurisdiction that you think is neutral, but almost never in the defendant's home jurisdiction. Th
Re:Should've kept him (Score:4, Insightful)
Hurd has overall knowledge but non-specific. His job was to direct the goals of the company. It wasn't to design chips, OSes, etc. His knowledge is about the direction the company was going, how to set up their priorities, how to spend and grow. He didn't have specific knowledge about the coding of projects or the design of hardware, just the direction those would take.
Oracle and Ellison are not really competitors to HP in the vast majority of areas where Oracle generates revenue (Oracle is primarily a relational database company selling to big companies). HP's competing OS is a non-starter. Even Oracle's acquisition of products from Sun wouldn't be such a major threat in any market to HP. As far as business models go Oracle's and HP's are probably quite different as they target different markets for the most part, as Oracle doesn't make printers nor desktop PCs and what they do compete with is probably limited to server markets where HP just doesn't have that much moxy.
If they try to limit Hurd's overall knowledge exposure they'll loose, they'll have to overcome years of legal history where one CEO goes to work for another company. And, this is HP's burden. HP must prove what they claim.
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Are you kidding? HP has been #1 in the server market for 8 straight years. A lot of Oracle stuff runs on HP equipment, and Hurd knows enough about HPs marketing and internals to help Oracle squeeze better margins out of HP. [hp.com]
Came here looking for some relevance between GNU (Score:2, Funny)
Hurd and Oracle only to find out once again it's talking about this guy. Man, he should really change his name.
Re:Came here looking for some relevance between GN (Score:5, Funny)
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From what I can tell, Larry Ellison knows Mr. Hurd personally, and also Hurd's ability to not run HP into the ground during a major worldwide recession (despite his paycheck) are pretty good indicators of how he'll do at Oracle. Think of Hurd as a very well paid sales person. Think Pete Campbell from Mad Men.
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whooosh
(Hint: Look up "Hurd")
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Whoosh
Bzzzt, wrong (Score:2, Funny)
Confidential Information? (Score:5, Funny)
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If only I had mod points...
Re:Confidential Information? (Score:4, Funny)
feck...
You shouldn't have fired him then. (Score:4, Insightful)
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Re:You shouldn't have fired him then. (Score:5, Insightful)
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No. That's stupid.
If you systematically screw your employees, the good ones go elsewhere. Your competitors will cheerfully hire them, leaving you with the ones who don't have the skills or initiative to find a better job. Then your company stagnates, and eventually collapses. This doesn't serve the employees, the company, the customers, the CEO, or the shareholders.
That doesn't mean that this doesn't happen, of course. What it means is that a bad employer is necessarily a bad CEO.
How is it... (Score:2, Insightful)
Re:How is it... (Score:4, Insightful)
cause the guys at the top are the ones making that decision, and would never dream of putting something like that in that may one day limit their ability to make millions.
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cause the guys at the top are the ones making that decision, and would never dream of putting something like that in that may one day limit their ability to make millions.
Nice thought, but actually he had a non-compete agreement. They just never hold up in California courts. [techcrunch.com] That's why they use the trade secrets angle.
This will certainly test California law (Score:3, Interesting)
California has a pretty clear cut law [lawzilla.com] that makes almost all non-compete clauses NULL and VOID. It'll be interesting to see how this one plays out.
Re:This will certainly test California law (Score:5, Informative)
From your link:
"Non-compete agreements are enforceable for partnerships and when someone is selling their ownership interest in a company. A related topic is the protection of trade secrets. A company can prevent the use of its trade secrets, but it cannot prevent fair competition"
Looks like they are trying to use the "trade secrets" protection part.
You are correct in that it should be interesting to see how it plays out.
Just my $0.02.
-JJS
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Well, if HP really doesn't want Oracle to use Hurd's knowledge of their products, Oracle could completely distance themselves from HP for a year or two. Heck, they come out and announce they no longer support Oracle running on HP hardware, except for those contracts already in existence, and that Oracle shops should switch to Dell servers. Just to make sure no HP IP inadvertently ends up in Oracle products. I'm sure that would make the HP board very, very happy.
Law different for owners and executives (Score:2)
California has a pretty clear cut law [lawzilla.com] that makes almost all non-compete clauses NULL and VOID.
Not quite. My understanding is that the law treats owners and the highest ranked executives differently than ordinary worker. Especially when trade secrets and other proprietary information is involved.
However even for workers the law you cite can get fuzzy. Lets say you agree to accept a payment in return for not working at a competitor for a reasonable amount of time, say a year. If you choose to take such a job you may be free to do so but you may also need to return the payment.
Painful (Score:4, Funny)
That's right, HP, kick Oracle where it hurds!
Re:Painful (Score:5, Funny)
Where the sun doesn't shine?
Re:Painful (Score:5, Funny)
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That was a good one! Hurdy hur hur hur!
Isn't that what the parachute is for? (Score:5, Insightful)
Re:Isn't that what the parachute is for? (Score:5, Insightful)
Maybe a little bit. But I think it's more for not airing dirty laundry that might have bad impacts on the stock price.
But mostly, you're given the golden parachute so that you will return the favor in kind at the corporations where you sit on the board. Isn't that how the game is played?
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Popcorn ready...but who to root for? (Score:2)
This is gonna kinda be like Godzilla vs. Mothra. It doesn't matter who wins the city of Tokyo is TOAST!
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Personally I am rooting on Hurd because that will help many of the little people too with these same clauses. I think that if they do not want him working for a set period of time, then then need to pay him for that time based on current salary (same as any other worker whom they do not want to work for the competition). That would make things fair for both sides.
So, if others decide to jump ship at HP... (Score:4, Funny)
You know your ego is huge when... (Score:3, Interesting)
You sign a non-compete agreement, then immediately sign up with one of the companies biggest competitors!
Either Hurd is actually a complete and utter moron or he has nads the size of Jupiter! I'm going with the latter.
Suck it HP (Score:4, Insightful)
California is a Right to Work State, you want to sue to prevent someone from having a job? Then move to Washington or New York.
Here in California we recognize the need for a person to earn a living plying their skill is more important than your need to treat people like property.
But hey, since those lawyers are salaried, better to use them to harass Mr. Sexual Harassment to put those payroll dollars to work am I right?
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No Legs or Wings (Score:2)
Trying to sue someone for what they might do is a huge stretch. And the idea that anyone can control a former employee is off the wall in some states. Usually one's obligations end when the pay checks stop. It's called freedom.
Stop digging... (Score:2)
HP on the other hand, having dug themselves in pretty deep on this one already, have just hired a crew at many hundreds of dollars per hour to help them dig deeper!
He's a hatchet man, but I think HP screwed up (Score:2, Insightful)
Mark Hurd's success is directly tied to the amount of people he can. He's absolutely known as a hatchetman, and will do so at the drop of a hat. The problem is, it works...he doesn't care about the employees, just the board, and doing what he does best makes them very happy.
Hurd used to be the CEO for NCR when I worked for him, and he did the same thing there....from there he moved to HP, and whacked something in the ball park of 7-9k jobs right away. Nothing will make a company look profitable faster than
Sour grapes QQ hypocrits (Score:5, Insightful)
HP's Board may be pretend to be aggrieved, but there is little they can do. California basically bans non-compete clauses. Some lawyers will get rich, and it will all be settled out of sight.
It would be more convincing if HP weren't such d@mned hypocrits: they complain of corporate secret leakage, yet they hired in Carly Fiorio as CEO from Lucent to get networking going and Mark Furd himself from NCR. Both "closer" in market terms to HP than Oracle is.
I think the HP Bored is just unhappy Mark bounced back quickly and very vexed the market agrees with him (Oracle's stock when up, HP down). Arrogant SOBs. I'd be embarrassed to work for them. Or buy their products.
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Also, they are demanding immediate injunctive relief... which court is available that can read this complaint today. With courts slammed and Congress unable to approve judges (or do much of anything useful), where will anyone be able to provide "immediate" injunctive relief?
Lastly, Hurd hasn't done anything yet. They are finding him guilty without any proof, before the fact, and without due process. Boy is HP a bunch of brats... "we can't have him and you can't either".
At least they didn't try to have him k
Re:Non-compete agreements (Score:4, Funny)
At least they didn't try to have him killed.
How would we know? A comically small cardboard cutout of a piano falling on his head? A swath of underpaid Chinese martial artists that surround him, then are summarily laid off? Someone tries to shoot him with an HP branded Smith & Wesson, with "Innovate" written on the bullets, but nobody can get the bullets to move?
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There are exceptions, but in this case, Hurd was fired/released
In effect, yes, though technically (and presumably for legal purposes) he did resign.
California law invalidates most non-competes; in this case, HP is going after one of the things they don't invalidate.
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That's an anachronism. No one shows loyalty to an ephemeral concept like "the American worker", except for politicians playing for votes and demagogues playing for eyeballs. Hurd hasn't shown loyalty to HP workers, this is true. By why should he have shown them loyalty? He was paid by HP shareholders to be loyal to them, not to be loyal to workers. CEOs at large companies don't depend on workers for their livelihood -- they depend on the Board
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He was paid by HP shareholders to be loyal to them, not to be loyal to workers.
Sometimes, for a manager, loyalty to the shareholders includes loyalty to the employees. Otherwise, shareholders lose access to valuable human resources.
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