HP may not be able to stop former CEO Mark Hurd from taking a job as co-president of Oracle.
Earlier this week, HP filed suit against Mark Hurd over his new job at Oracle. The company claims that as CEO of HP, Hurd was privy to all kinds of trade secrets and says these will be at risk if he takes up position as co-president of Oracle. However, experts say HP is unlikely to be successful in its endeavours.
California law doesn't favor non-compete agreements, but HP yesterday highlighted the amount of cash, stock and stock options given to Hurd in exchange for protecting trade secrets and said it would be impossible for him to work at Oracle without revealing trade secrets. Late last night law experts were saying HP's suit is a long shot.
Bloomberg cites Mark Lemley, a professor at Standford Law School who specializes in intellectual property, who says HP's argument that trade secrets will be eventually disclosed won't work in California.
"Neither will California courts enforce a noncompete agreement," Lemley continued. "HP will have to show real evidence that Mark Hurd is about to use its secrets at Oracle."
Frederick Baron, chair of the employment and labor practice at Cooley LLP, told Bloomberg that HP will have an 'uphill climb' if it wants to stop Hurd taking the job at Oracle.
"The inevitable use doctrine has been argued around the country, but it is not well established in California or in many jurisdictions," Baron said.
"Oracle is assuming Mark Hurd can do his job based on his general know-how and talents."
Stephen Hirschfeld, a partner at Curiale Hirschfeld Kraemer LLP in San Francisco added:
"In this state, you can do pretty much whatever you bloody well want unless you compete with me unfairly."
Oracle announced the arrival of Mark Hurd late on Monday. Hurd is to join the company as co-president alongside current president Safra Catz. He left HP amid sexual harassment allegations. An investigation revealed that he had not violated HP's sexual harassment code, but found he fudged expense reports to cover up a relationship with a female contractor.