First Mark Hurd, now Adrian Jones? Hewlett-Packard (NYSE: HPQ) has sued Oracle (Nasdaq: ORCL) again, this time for poaching a sales executive who left HP under what appear to be (ahem) suspicious circumstances.
According to court filings quoted by The Wall Street Journal, Jones, who joined HP in March 2007, served as a sales executive for the Asia Pacific region until his departure in February of this year. He apparently resigned five days after copying internal HP documents to a USB hard drive, then joined Oracle a month later.
Today, he's listed as Oracle's senior vice president, systems sales, Asia Pacific & Japan in his LinkedIn profile, which means he's working with Hurd again.
Predictably, HP is suing to keep Jones from using what he allegedly took to create an "unfair competitive advantage" in its fight for market share with Oracle, the Journal reports. The PC maker sued Hurd for similar reasons, though HP never accused Hurd of stealing documents.
Intrigued yet? Wait, it gets better. According to the Journal, Jones was about to be fired for violating its code of business conduct. Jones allegedly had an inappropriate relationship with a subordinate, for whom he approved a 97% increase in pay. He's also accused of wrongfully claiming reimbursements for thousands of dollars in expenses for visiting this employee. Stop me if any of this sounds familiar.
Hurd's tale isn't as romantically charged as Jones's is, yet the patterns of abuse are startlingly similar. Both have been accused of what amount to "ethical lapses" in polite language, and both apparently abused shareholder capital for personal gain.
As an investor, it makes me wonder:
- What the [expletive] is going on at HP?
- What the [expletive] are you doing hiring these guys, Oracle?
This isn't an appeal to the "holier than thou" in each of us but rather a pair of serious questions. Management talent matters; ethics matter more. Look no further than Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) and the David Sokol affair to see what questionable judgment can do.
If you thought of high tech as higher education, HP would be the school suffering from past probations and wary looks from deans and prospective students suspicious of its history of unflattering incidents. Oracle would be the "we don't care what you think about our graduation rates" powerhouse who'd do whatever's necessary to raise a banner.
Maybe I'm making too much of this. Maybe this is the way Silicon Valley salespeople act and companies respond. But if that's really the case, then maybe it's time I parked the thousands I've invested in Oracle into some other worthy stocks. As for HP, let's just say this confirms the short thesis I've espoused for months now.
Do you agree? Disagree? Let us know what you think about HP's lawsuit, Oracle's business practices, and the soap operas that make Silicon Valley what it is using the comments box below.
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