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HP drops suit seeking to block ex-CEO from joining Oracle

Mark Hurd agrees to not share HP trade secrets with his new employer and waives his rights to special stock units worth millions.

September 21, 2010|By David Sarno

Hewlett-Packard Co. agreed Monday to end a lawsuit aimed at preventing its recently ousted chief executive, Mark V. Hurd, from going to work for rival Oracle Corp.

Under the settlement, Hurd agreed not to disclose HP's trade secrets to his new employer and waived his rights to nearly 345,000 special stock units he was entitled to as part of his severance package. If sold today, they would be worth close to $14 million.

In addition to the stock units he gave up, Hurd's severance package included more than $12 million in cash and 775,000 stock options that vested on the day of his resignation, worth tens of millions more.

The settlement was a quiet denouement to what had been a dramatic boardroom story that began with Hurd's August resignation from HP, the world's largest computer maker, after a female contractor accused him of sexual harassment.

Soon after, Oracle Chief Executive Larry Ellison publicly mocked rival HP for what he called "the worst personnel decision since the idiots on the Apple board fired Steve Jobs." Seemingly thumbing his nose at HP, Ellison quickly hired Hurd as a co-president and board member for the Silicon Valley computer systems giant.

But HP and Oracle struck a conciliatory note in a joint news release Monday about the settlement.

"HP and Oracle have been important partners for more than 20 years and are committed to working together to provide exceptional products and service to our customers," said HP's acting chief executive, Cathie Lesjak, in a statement. "We look forward to collaborating with Oracle in the future."

Ellison, who had initially called HP's suit against Hurd "vindictive," contributed a few tame words to the statement as well.

"Oracle and HP will continue to build and expand a partnership that has already lasted for over 25 years," he said.

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