HP's ousted CEO reportedly settled harass case

SAN FRANCISCO - Ousted Hewlett-Packard Co. CEO Mark Hurd has settled allegations of sexual harassment lodged against him by a female contract worker for HP, a person with knowledge of the case told the Associated Press.

The harassment accusation set off a chain of events that led to the discovery of allegedly falsified expense reports for dinners Hurd had with the woman and culminated in Hurd's forced resignation Friday from the world's largest technology company.

The person familiar with the case said late Saturday that Hurd agreed to pay the woman but would not reveal the size of the payment. The deal was reached Thursday, a day before Hurd's resignation. The settlement was between Hurd and his accuser and did not involve a payment from HP, this person said.

This person, who spoke on a condition of anonymity, was not authorized to speak publicly about the issue.

The nature of the harassment complaint wasn't clear. Hurd and a lawyer representing the woman said the relationship was not sexual.

The woman's lawyer, celebrity attorney Gloria Allred, declined to describe the alleged harassment. Allred would not identify her client or make her available for an interview.

The woman was paid up to $5,000 per event to greet people and make introductions among executives attending HP events that she helped organize.

HP's board of directors said its investigation found that Hurd listed other people as his dinner partners on expense reports when he'd been out with the woman. HP also claimed Hurd arranged for her to be paid for work she didn't do.

There was only one instance in which that occurred, the person close to the case said, but it was for an event that was canceled at the last minute and the woman's contract required that she would be paid unless an event was canceled 30 days in advance.

The amount of money in question wasn't known.

Hurd, 53, insists they were legitimate business expenses. He says the errors in the reports may have been entered unwittingly by an assistant, according to the person close to the case.

Interim CEO Cathie Lesjak defended the company's decision.

She said yesterday that HP acted appropriately and that investors and big customers she has spoken with have been "extremely supportive."

"One thing happened in this company on Friday - that is the CEO left. The rest of the company did not change."

Lesjak declined to go into further details about the expenses Hurd was alleged to have doctored.

Hurd had engineered a stunning turnaround of the Silicon Valley stalwart.

Under Hurd, HP has spent more than $20 billion on acquisitions to transform itself from a computer and printer maker dependent on ink sales for profits to a well-rounded seller of hardware and lucrative business services. HP's market value nearly doubled during his five years.

Hurd's ouster is the third in five years at HP's top echelon.

First was Fiorina's in 2005, then former Chairwoman Patricia Dunn was ousted in 2006 amid a scandal that involved spying on reporters' and directors' phone records to suss out the source of leaks to the media.