HP board said to turn against Hurd after settlement

Hewlett-Packard Co’s Mark Hurd surprised the board by settling a sexual-harassment claim before directors could learn more about the incident, a final breach of trust that contributed to his ouster as chief executive officer.

Hurd, who stepped down on Aug. 6, was scheduled to join a mediation session the previous day to deal with the harassment claim, the people said. Instead, Hurd settled the complaint and the meeting never happened, they said. The board’s trust in Hurd also was undermined after a probe found he tried to conceal a relationship with his accuser, a former actress named Jodie Fisher who worked for HP as an event organizer, said the people, who asked not to be named because the information is private.

The handling of Hurd’s departure has drawn a shareholder lawsuit and a rebuke from Oracle Corp. CEO Larry Ellison, who compared the move to the firing of Apple Inc.’s Steve Jobs in the 1980s. The suit, filed Aug. 10 by a Massachusetts pension fund, says that mishandling the matter contributed to the plunge in HP’s stock last week, erasing $9 billion in value.

A person familiar with Hurd’s thinking said HP knew he was trying to settle with Fisher, and had encouraged him to do so. Also, the mediation session wouldn’t have presented new evidence or allegations, the person said.