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January 20, 2011

Board Members to Investigate Mark Hurd's Exit from HP

Several directors on Hewlett-Packard’s board will review how former CEO Mark Hurd (News - Alert) left the company after allegations surfaced about possible sexual harassment, Reuters is reporting.

The inquiry will take place by independent directors who took their posts after Hurd left in August, Reuters (News - Alert) said.

Outside legal counsel will help them conduct the investigation, Reuters said, citing court papers.

Though there were allegations of sexual harassment, the board said there was no evidence to substantiate them. The board had used outside attorneys in their initial inquiry.

HP’s earlier investigation showed “inaccurate expense reports” were submitted, and concluded that Hurd's actions, related to a self-employed consultant, showed “a lack of judgment,” Reuters said.

Hurd is now co-president at Oracle. Oracle (News - Alert) CEO Larry Ellison was a vocal opponent of Hurd’s forced resignation, according to a blog posting from TMCnet CEO Rich Tehrani (News - Alert).

Shareholder plaintiffs are suing HP, apparently in response to its actions in Hurd’s departure, and they say the “separation agreement” cost the company about $40 million, in either cash or stock/options, Reuters reported. They claim the expenditures amounted to "corporate waste," Reuters said.

Reuters adds that the separation agreement was “pared back” after Hurd and H-P reached a settlement over him taking the job at Oracle.

TMCnet reported in August that Hurd decided, with the Board of Directors, to resign his position as CEO, effective immediately.

At the time of his exit, HP’s Robert Ryan, lead independent director, released a statement that said in part, “The board deliberated extensively on this matter. It recognizes the considerable value that Mark has contributed to HP over the past five years in establishing us as a leader in the industry,” TMCnet reported. “He has worked tirelessly to improve the value of HP, and we greatly appreciate his efforts.”

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Ed Silverstein is a TMCnet contributor. To read more of his articles, please visit his columnist page.

Edited by Tammy Wolf
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