Larry Ellison, the billionaire co-founder and CEO of software giant Oracle (ORCL), is angry about the way his friend Mark Hurd was dispatched by Hewlett Packard's (HPQ) board. And Ellison, never known as a shrinking violet, is letting the world know about it.

In a scathing letter released to news organizations late Monday, Ellison excoriated HP's board for making what he characterized as a terrible decision to force Hurd to resign -- a decision that Ellison says will haunt the company and cast a shadow over HP's future.

"The HP Board just made the worst personnel decision since the idiots on the Apple Board fired Steve Jobs many years ago," Ellison wrote. "That decision nearly destroyed Apple -- and would have, if Steve hadn't come back and saved them."

Oracle a Key HP Partner

As the third-largest software maker in the world, Oracle is a major HP partner. Oracle's purchase of Sun Microsystems, completed last January, also means the two companies compete.

In a not-too-subtle swipe at former HP CEO Carly Fiorina, Ellison suggested that HP's board had lost its finest leader since the early days of William Hewitt and David Packard. "HP had a long list of failed CEOs until they hired Mark, who has spent the last five years doing a brilliant job reviving HP to its former greatness," he wrote.

Ellison, a close personal friend of Hurd, blasted HP's board for failing "to act in the best interest of HP's employees, shareholders, customers and partners. The HP board admits that it fully investigated the sexual harassment claims against Mark and found them to be utterly false."

"Cowardly Corporate Political Correctness"

Hurd shocked the technology world by resigning last Friday after HP's board found he had falsified expenses associated with a former HP contractor -- actress and reality show contestant Jodie Fisher. Fisher had filed a sexual harassment claim against Hurd -- which HP's board found was without merit -- but the directors were apparently divided over whether to make it public.

In the end, according to Ellison, HP's board voted 6 to 4 to make the harassment allegation public. Rather than exercising good corporate governance, Ellison portrayed the board as capitulating to "cowardly corporate political correctness."

"Those six directors caused HP to lose a nearly irreplaceable CEO," Ellison wrote. "Those six directors who voted against Mark can try hard to hide behind a claim of 'good corporate governance,' but their decision has already cost HP shareholders over $10 billion ... and my guess (is) it's going to cost them a lot more." HP shares have fallen more than 15% since Hurd resigned last Friday.

Expense Fraud Claims an "Insult"

Ellison went on to ridicule the board's stated explanation for Hurd's ouster -- that the CEO falsified expense reports.

"The final insult was when the HP board [went] to the press and suggested that Mark Hurd engaged in expense fraud over a few thousand dollars," Ellison wrote. "This is not credible. Mark Hurd, like most other CEOs, does not fill out his own expense reports, so even if errors were made, Mark didn't make them."

"What the expense fraud claims do reveal," Ellison concluded, "is an HP board desperately grasping at straws in trying to publicly explain the unexplainable: how a false sexual harassment claim and some petty expense report errors led to the loss of one of Silicon Valley's best and most respected leaders."

In a parting shot at HP's board, Ellison described Hurd as a "close friend" and said he was "deeply offended by what just happened to him. If the HP board is offended by my comments ... so be it."

For his part, Hurd's ouster will be softened by the fact that he's departing with a severance package worth as much as $37 million -- a payout that's already drawing criticism. Todd Bradley, executive vice president of HP's personal systems group, is seen as a leading contender to succeed Hurd as CEO.

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Al

$10 billion in lost value over a few thousand bucks? These board members are idiots! If I were a stockholder I'd be furious at those members of the board and vote to kick them out!

August 10 2010 at 10:20 PM Report abuse rate up rate down Reply
greggj52

Larry Ellison could just shut up and bring Mark Hurd on board at Oracle. $37 Million, sure Mark is not feeling any pain. Of to next CEO post.

August 10 2010 at 6:27 PM Report abuse rate up rate down Reply
mcgowann

This should strengthen Carly Fiorina's senate bid in California. If HP is not above making up reasons to fire CEOs, Barbara Boxer can be countered for pointing out that Fiorina was fired by HP. Fiorina can say HP is known for firing CEOs without a legitimate reason.

August 10 2010 at 4:37 PM Report abuse +2 rate up rate down Reply
kamdajani

xx

August 10 2010 at 2:45 PM Report abuse rate up rate down Reply
rctmr61

Sorry Rafael, this is the way the system is supposed to work. The claims having been found invalid should have been plenty reason to maintain the status quo. However, it appears something else is considered less than appealing with Mr. Hurd. While it is unclear what and how much the discrepancies are it is obvious that the board of directors intends for ALL employees to fit with policy and procedure, not just the peons. Mr. Hurd should be held as accountable for the slightest error just like his lowest employee. His compensation appears to more than adequate that his compensation for expenses should be exact. Larry Ellison does nothing more than show why the corporate structure needs some oversight. Boohoo, my friend who never hurt anyone got canned, the world is so unjust for overpaid CEO's.
As for the stockholder, you probably lost more and could have gained greater over the years if your corporate execs didn't have their cushy paychecks, perks, and golden parachutes.

August 10 2010 at 2:42 PM Report abuse -1 rate up rate down Reply
Vlado

One good American company and # of not to responsible people running it. Well maybe this one will Chinese bay out and then Thank you US Electronics. Oh boy where do they come from??!!!

August 10 2010 at 2:37 PM Report abuse -1 rate up rate down Reply
kamdajani

thanks

August 10 2010 at 2:27 PM Report abuse rate up rate down Reply
rafael7541

It is a shame when a 50 year old obviously experienced woman in the game of life makes a false accusation and cost a man his job. Then again maybe he deserves it for playing the game and taking the easy way out and paying her extortion money, this however was probably induced to Mr. Hurd by the unfairness of our legal system were accusations to our fellow citizens are nothing more than extortion demands which lawyers know they will get away with because our courts punish succesful persons in our society by giving exagerated rewards in our civil courts, therefore forcing individuals, insurance companies to give hush money which in turn only makes these unfounded cases appear even more often.

August 10 2010 at 2:17 PM Report abuse -1 rate up rate down Reply
pmbalele

The truth is I do not know why HP board fired Mark Hurd. Those who fired this guy may be the one doing it too. I read the article and found nothing bad with that woman. It seems if you ask for a date with a woman, you're in trouble now.

August 10 2010 at 2:15 PM Report abuse +1 rate up rate down Reply
Rodger

Larry Ellison is somewhat like the tea kettle calling the pot Black. He is one
over paid executive in comparison to Oracle's performance for stock holders!
I think Oracle's board should have fired him long ago.

August 10 2010 at 1:55 PM Report abuse rate up rate down Reply