HP says Hurd can Kiss, but he can’t Tell

Oct 12, 2010

Mark Hurd is being sued by his former employer, Hewlett Packard (HP) for breaching confidentiality restrictions in his severance agreement.
Hurd was the CEO of HP for 5 years, until he recently stepped down following a sexual harassment investigation.  Oracle quickly stepped up to offer Hurd a position, with high hopes that he could replicate the results he brought to HP.  This came as no surprise after Oracle’s president Larry Ellison publicly disapproved of HP’s decision.
The day after the announcement of Hurd’s new role, HP filed a lawsuit seeking an injunction on the basis that Hurd could not perform his regular job duties without compromising HP’s trade secrets.
Non-competition agreements are difficult to enforce for a number of reasons.  When a contract has an explicit non-compete clause, it must not be overly restrictive in its length or scope.  Typically, the scale tips in favour of employees when judges evaluate enforceability because of the limitations they can impose on an employee’s employment opportunity within a specific industry.  HP will have to prove that Hurd’s new job duties necessitate the use of HP’s trade secrets and that the time restriction of 24 months is reasonable.
California is notorious for its opposition to non-competition agreements.  That being said, HP may succeed at the very least in delaying Hurd from taking on his new duties.   HP has yet to appoint a new CEO, and both companies are now dealing with a highly publicized lawsuit.  The drama surrounding this corporate conflict is sure to continue.
Read more about Hurd on the CNN website.
Visit our website for more articles on non-competition agreements, such as, “Be careful when working for a competitor”.

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