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Hewlett-Packard has filed suit against Mark V. Hurd, former CEO and chairman. The lawsuit comes just a day after Hurd joined Oracle, an HP rival, as co-president. HP seeks to enforce confidentiality agreements signed by Hurd.
According to HP, the contract signed by Hurd obligates him to protect the trade secrets and other confidential information to which he was privy. HP further argues that Hurd cannot reasonably hold the job of co-president without making use of the trade secrets he learned while at HP. In the complaint, HP called Hurd's move to Oracle, "a serious threat to HP's business."
Hurd's tenure as CEO ended after five years, during which time he faced a sexual-harassment investigation. He also faced allegations of inaccurate expense reports related to time spent with an actress, The Associated Press reports.
The case is certainly one which in-house counsel should keep an eye on. If the company you work for is making use of confidentiality clauses, it's worth watching how this case plays out. Although confidentiality agreements are very common, they can be very difficult to enforce.
According to the complaint, Hurd joined HP in April 2005 and was provided access to HP's trade secrets and confidential information after signing a non-disclosure agreement. Hurd allegedly executed several non-disclosure agreements. Hurd also signed "Trade Secret Protection Agreements," most recently in February of 2010. Under these agreements, Hurd agreed to keep HP's trade secrets and confidential information protected both during and after his employment with HP.
But is that possible to do when Hurd is now working for a competitor a co-president?
If the case makes it to court, it will be very interesting to see whether it is found that a one can sign trade secret agreements and then quickly move to a competitor. If you are interested in reading the complaint, HP was kind enough to post it to Scribd.