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“The shocking announcement from the world’s top personal computer maker sent its shares plunging 10 percent, as Hurd is one of the most admired executives in Silicon Valley, credited with reviving HP after the tumultuous reign of Carly Fiorina,” Madway and Oreskovic report. “The unnamed contractor, who did marketing for HP from late 2007 to fall 2009, contacted the firm’s board in June this year and alleged that Hurd had sexually harassed her, HP said.”
“The board ordered an investigation and found that the married 53-year-old Hurd did not violate HP’s sexual harassment policy. But he had a ‘close personal relationship’ with the woman that was never disclosed to the board, HP said,” Madway and Oreskovic report. “‘The board investigation found that Mark demonstrated a profound lack of judgment that seriously undermined his credibility and damaged his effectiveness in leading HP and Mark agreed,’ HP General Counsel Mike Holston said, adding that the board’s decision to replace Hurd was unanimous.”
“According to HP, Hurd filed ‘numerous inaccurate expense reports’ that concealed his relationship with the contractor, who also received compensation and expense reimbursements without legitimate business reasons,” Madway and Oreskovic report. “Hurd, who was also chairman of HP and had a reputation for rigid cost discipline, said the decision to step aside was a ‘painful’ one.”
“A source familiar with Hurd’s account of the situation described his relationship with the contractor as ‘business acquaintances’ who had dined together about a dozen times. The source said the expense issues stretched over two years, were related to travel, meals and lodging, and totaled up to $20,000,” Madway and Oreskovic report. “Another source familiar with the situation described the woman as a ‘low-level contractor’ who would assist at marketing events.”
“Hurd was known as a serial acquirer, unafraid of making bold moves to take on competitors like IBM, Apple Inc and Research in Motion,” Madway and Oreskovic report. “‘Mark Hurd was extremely instrumental in turning this company around,’ said Susquehanna Financial Group analyst Jeffrey Fidacaro. ‘There’s going to be a serious gap in leadership at the top of this company.'”
Madway and Oreskovic report, “Hurd will be well compensated as he departs HP, receiving a severance payment of $12.2 million. His 2009 total compensation was $30.3 million, according to a filing. His total compensation in the last three years was about $97.8 million. HP said its board of directors has formed a search committee to find a new chief executive and board chair.”
Read more in the full article, in which Gloria Allred, who is (of course) representing the woman who made the sexual harassment claim, says her client did not have sex with Hurd, here.
MacDailyNews Take: Made $30.3 million, but fraudulently expensed “up to $20 thousand.” Stupid. Cheap. Loser. Adidos, Markie!
So, what do you think, skip the book and wait for the movie?
Apple should buy them now, if for no other reason, to assimilate that IP they got from Palm, and prevent the emergence if a new OS competitor to OS X.
If I falsified $20,000 worth of expense reports, my employer wouldn’t be giving me a $12.2 million severance payment.
They WOULD spring for a shinny new pair of handcuffs.
Just as HP was starting to look like a company with a bit of courage and initiative, something like this happens… unbelievable. Now, they’ll probably lose their collective nerve and crawl back to Microsoft to use Windows 7 and Windows Phone 7 in their future mobile devices. And if that happens, I would be sad.
Apple buying HP… That’s pretty funny. Apple has some major bucks, but not THAT much.
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“The shocking announcement from the world’s top personal computer maker…”
What I’m finding strange about these reports today is lines like the above. Variations include:
“the largest computer company in the world”
“what is now the largest computer company in the world, measured by total revenues.”
“pushing the company to the top of tech world”
“turned Hewlett-Packard into the world’s largest technology company
So, knowing that APPLE is the largest technology company in the world, with only Exxon Mobile being larger among all companies, what’s with these TechTard journalist statements?!
It turns out that one of these statements actually is true. It’s this one:
“what is now the largest computer company in the world, measured by total revenues.”
HP is much smaller than Apple, but going by the results of their last business quarters, HP actually does have higher total revenues than Apple. News to me! The figures from the last quarter:
HP revenue: $30.8 bn.
Apple revenue: $15.7 bn.
Now I know. It’s a matter of semantics. Know your facts and state them correctly.
What journalist got it right? Erica Ogg at CNET, you get a gold star! *
Isn’t he the one who stepped up when Carly Fiorina stepped down?
Must be something in the water, over at HP.
If Rubenstein is called up from the minors, will he too leave under a cloud of scandal?
I hate HP and their shit printers.
G4Dualie sez: “If Rubenstein is called up from the minors, will he too leave under a cloud of scandal?”
Judging by Rubenstein’s results over at Palm, I’d say he’d be HP’s ‘Ballmer’. Sorry, but I don’t dislike HP THAT much!
Let’s see…a company with ~$107 Billion Market Cap…down 10% on the news of CEO resignation…that’s a loss of ~$10 Billion for investors and same CEO now receives ~$50 Million severance package, over a dalliance/liaison that may have cost the company ≤ $20 Thousand. The numbers don’t add up.
I just wonder what’s the real story, how much did the contractor lady receive for her trick? Was Microsoft involved? Who is benefiting of this? Is there something going on at HP that required them to get rid of Mr Hurd? Or is it just the genuine American stupidity of saving $20k to loose $12.2 million and a good boss?
Why are we here?? I think I musta made a wrong turn back there somewhere…
What I find amusing is that someone who earns tens of millions takes his piece on the side out on his corporate expense account.
Do these people pay for anything themselves, ever?
Damn. Even super rich computer geeks can’t get some on their own? Ever hear the word disctrete? Don’t drag your company down too, jeez.
@Newton
The issue isn’t mathematics, it’s character.
HP is the biggest when you count PC marketshare
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I know.. you’re right.. they just use these different measurements to push the story, but yea..
Don’t be too hubristic Apple fans (that includes me).
I can promise you there is more than one senior/middle ranking Apple executive right now being silly and alternately having a great time and then shaking with fear at being found out.
It’s the American (and British, Canadian and Australian, but not French) way.
I think Rubenstein would make them a serious threat to apple. While the pre was a little weak, I think he turned palm into a mini apple. If he did the same to HP it would be trouble
Dead girl or live boy?
It’s the American (and British, Canadian and Australian, but not French) way.
I KNEW IT! I always thought those French people were gay, with that silly language and fru-fru…
Kidding, Kidding… =P
What a cheap ass, he made $30m last year and he was trying to save $20k?
He deserved it, greedy idiot.
Hurd was just a lucky costcutter. I was surprised his game lasted as long as it did.
I agree with RobG, above. The whole thing would have been avoided if he had paid the $20k out of his own pocket. Jerk!!!
Good work, Derek Currie! (Seriously)
You get TWO gold stars!
The story out there is that Hurd isn’t gone because of the money, but because he violated the HP Standards of Business Conduct that we have to go through training for every year. The only bright side here is that maybe his wide will divorce him and take more than half of his worth.
It’s going to be difficult for those of us that work there as it might mean a change in direction, and that’s always a pain. I’ve been around since DEC/Ken and it’s been a pain every time…
Another case of pecker fall out, or broken zipper, happens all the time, sad part is if you’re a big business puke, or wall street crook you get a really big check as a going away present.
MW: moral, in this case lack of.
@low-level contractor lady
“I agree with RobG, above. The whole thing would have been avoided if he had paid the $20k out of his own pocket.”
Besides being cheap, he probably wanted to avoid having to explain to his wife where that money was going, and why he was using personal money for “business expenses” such as restaurant dinners and whatever else they were doing.
Classic case of “little head” doing the thinking!
But totally agree with the comments about making millions and filing 20K in false expense reports!
@primerib
If I made 90 million in the last 3 years, my wife wouldn’t worry about where 20K went,
She’d be to busy with her “tennis and yoga instructors”
Something doesn’t make sense here.
Cover story?
“So, what do you think, skip the book and wait for the movie?”
Neither. It isn’t worth any further attention. When I want a real tragedy, I’ll turn to Shakepeare.
Every man’s dick has led him astray from time to time.
You regret the times you were weak and followed your dick and you regret the times you overruled your dick and missed an opportunity.
You just can’t win.
Oooops! make that “Shakespeare”.
Neither, Markie’s an effen id10t.
Those with wealth and power who commit crimes are often allowed to bypass the consequences by resigning or accepting a slap on the wrist. Sometimes even get handsomely rewarded to bow out quietly.
Celebrities – actors, musicians, athletes, etc. – involved in drugs and prostitution generally get several chances to “turn their lives around” in expensive and exclusive rehab centers.
There is one set of laws that applies equally to all, or else there is no law.
the board must have known ahead of time the hit they’d take financially for the rounding error of $20k.
Conduct rules or no, if they really wanted to keep him they would have found a way.
As for making $30M and and still trying to forge $20k – well that’s either real stupid or just plain ego. Deserves what he gets, which is hopefully fleeced in the divorce settlement.
He’ll be a CEO somewhere else within 18 months though. The American way…
The woman officially insists there wasn’t sex, and the company officially found no harassment. It’s naive I suppose to take those statements at face value, but as far as the “official” evidence, there is nothing but $20K plus the somewhat more serious falsification. Hurd was making that much money every seven minutes.
This hardly seems to justify canning the company savior, unless the actual details are juicier than anyone has so far admitted.
Ok, here’s the scary part people: what if Micro$oft’s board decides Mark Hurd would be a great replacement for Monkey Boy Ballmer? Now THAT would be seriously bad news for Apple…
@ ken1w
“Apple buying HP… That’s pretty funny. Apple has some major bucks, but not THAT much.”
Actually they would only have to buy controlling interest. HP market cap is $97.7B and 51% if that would be $48.85B or just a few billion more than the cash reserve Apple has. Even with a buying premium a years earnings would make up the difference.
Of course I think there is no need to buy HP. Just stay the course and keep raking in the $$$.
It was a Microsoft Mole. The Palm purchase is the threat to MS; so, you know, it’s just business.
HP hasn’t been the same since Bill and Dave went off to The Big Garage In The Sky.
Kind of glad my father-in-law (HP employee for 30 years before retiring in 1995) died a few months ago so isn’t around to see what’s left of the shell of the company he loved.
@panchochico
Conduct rules or no, if they really wanted to keep him they would have found a way.
Maybe on your planet, but on planet Earth integrity still means something. Just ask Papermaster, who was fired by Steve Jobs for creating Antennagate.
I have learned through painful experience that
growing older doesn’t mean that you will automatically
get smarter,better looking,richer,more admired etc.
as I hoped when I was in grade school. The only
guarantee is that you get older. Some people like
Mark Hurd and Tiger Woods among countless
others still remain stupid and clueless.
@ the truth hurts
Apple is not going to spend 100% of its cash reserves on any ONE initiative.
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This Mark Hurd thing has been going on since late June. Maybe Mark Papermaster put out “feelers” for the top HP job, Steve Jobs found out and got royally ticked off for the apparent show of disloyalty, and he was “asked” to leave. No one has officially said that Papermaster was canned because of “Antennagate”; it’s more sensationalist speculation from the media.
“Maybe on your planet, but on planet Earth integrity still means something”
Please inform any and all of our politicians.
Did I misunderstand something? He falsified reports for 2 years having to do with this woman? Doesn’t that mean he was seeing her for those 2 years (at least)? Or, was it a different woman earlier or something.
This doesn’t make sense.
If it was the same woman for 2 years, then I have to wonder how much sexual harassment went on. It seems a bit implausible that she put up with it for 2 years, though not impossible.
Sure he was foolish about it, but sexual harassment is a serious charge and shouldn’t be made lightly or vindictively.
–Ron
His total compensation in the last three years was about $97.8 million.
This is what’s wrong with corporate America, and it started in earnest during the Reagan years, the beginning of the end.
It’s a pretty commonly held opinion that Mark Hurd is a first-class jerk. He can clearly crunch numbers and lower operating costs, which might have done HP some good for about 3 years. But the company has fallen to the bottom end of “worst to work for” lists. I know many people who’ve left HP and the stories about how much has changed (for the negative) are unbelievable.
Good post about this:
http://bobsutton.typepad.com/my_weblog/2010/08/on-hps-mark-hurd-assholes-sometimes-get-their-due-.html
Hurd on the street.