HP, Oracle battle over Mark Hurd gets ugly

Things are really getting messy between Hewlett-Packard (NYSE: HPQ) and Oracle (NASDAQ: ORCL). On Monday, Oracle hired Mark Hurd, former HP CEO, as co-president, and by Tuesday evening HP had filed a lawsuit against him, alleging breach of contract and threatened misappropriation of trade secrets. Hurd, as you recall, left HP in August after being charged with harassing a contractor and filing questionable expense reports. 

Dan Gillmore at Salon put it best: "This could get ugly. Oh, wait, it already is." He notes that Oracle is far more competitive with HP now than it was even one year ago, having gotten into more of HP's line of work with the acquisition of Sun Microsystems. "The whole thing adds a layer of bafflement to the already bizarre circumstances of Hurd's departure from HP, which seem to have involved some kind of relationship with a woman who wasn't his wife as well as some expense-account mischief," Gillmore writes.

Most revealing perhaps, Oracle's stock price rose after the company announced it had hired Hurd. "It's worth noting, in all this, that investors only care about ethics if they see some effect on share prices," notes Gillmore.

Although Hurd had signed a document agreeing not to provide services to a competitor for two years, the clause "has holes," writes the Wall Street Journal's Jennifer Valentino-DeVries in a quick analysis of the lawsuit. According to Valentino-DeVries, the non-compete clause is relevant "only to Conflicting Business Activities that result in unauthorized use or disclosure of HP's Confidential Information."  But in HP's view, Hurd won't be able to do his job for Oracle without calling upon HP's confidential information, she says.

Offering a more detailed report of the legal environment surrounding the case, Brandon Bailey at the San Jose Mercury News writes that experts expect HP to have a tough climb ahead. Courts in California are skeptical of these kinds of charges, and similar cases have often reached settlement before going to trial. However, HP has already hired a slew of high-profile lawyers to make its case, Bailey reports.

For more:
- see Dan Gillmore's post at Salon
- read Jennifer Valentino-DeVries' post at the Wall Street Journal
- see Brandon Bailey's article at the San Jose Mercury News

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