Rogers & Tartaro Business Litigation Blog : New York and Connecticut Business Litigation Lawyer & Attorney : Rogers & Tartaro Law Firm : Commercial Litigation : Westchester County NY, Fairfield County CT

When we last left some of our posts, lawsuits were filed, cases were being heard, or legal action was pending. Below are some updates on the stories we’ve been following:

HP v. Oracle:.
Settled, terms undisclosed.

“HP and Oracle today reaffirmed their long-term strategic partnership and the resolution of litigation regarding Mark Hurd's employment at Oracle," said HP.
"While the terms of the settlement are confidential, Mr Hurd will adhere to his obligations to protect HP's confidential information while fulfilling his responsibilities at Oracle."

We might have learned a lot about the law from such a suit but from the settlement we learned a lot about business. It doesn’t pay to get into a squabble with your potential strategic partners.

Does Susan Bysiewicz have what it takes to be the state AG?
Apparently not.

The Connecticut Supreme Court found that Bysiewicz failed to meet the requirements of General Statutes Section 3-124.

Lindsay v. E-Trade
We didn’t actually comment on this case, but it offers a valuable business lesson about guarding intellectual property and avoiding squabbles that are to no one’s advantage.
 

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…Perhaps when it’s filed in California, as we’ll soon learn.

Last week, technology giant Hewlett-Packard Co filed a lawsuit in California court against ousted CEO Mark Hurd, alleging breach of contract and threatened misappropriation of trade secrets.   Hurd, the former head of HP, recently accepted a job as co-president of Oracle, a chief rival. 

According to the Associated Press, the lawsuit claims that Oracle hired Hurd “to help steal business from HP.” HP claims that Hurd will inevitably disclose HP's trade secrets and violate the HP confidentiality agreement.

As the Wall Street Journal points out, Hurd agreed to abide for two years by Section 7 of his confidentiality agreement which states that “I will not provide services to a Competitor in any role or position (as an employee, consultant, or otherwise) that would involve Conflicting Business Activities.”

Confidentiality agreements are common, especially in technology fields. A key element not necessarily in HP’s favor is that they filed suit in California Supreme Court.   Non-compete clauses haven’t traditionally been easily enforced in California. Their courts have ruled “inevitable disclosure” as being an insufficient cause of action. There must be a threat of misappropriation of trade secrets made overtly by the former employee, or an actual misappropriation of trade secrets by the former employee.

Mr. Hurd’s case is both interesting and unusual because it involves a senior executive position and we can expect HP to claim the most detailed confidential information about the company is carried in his head.

The more usual experience - - in our own Connecticut and New York practice - - is that non-competes have to be reasonable as to time and geographic area.  Confidentiality agreements can’t prohibit disclosure of what is commonly non-confidential.  But, what we’ve seen is that they are more and more comprehensive even for middle managers. You usually can’t get a severance package without the non-compete and confidentiality agreements.        

Speaking of severance packages, Mr. Hurd’s is estimated to be somewhere in the neighborhood of the $40 million mark. 

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