Coral that deteriorates like rock

[Kodi01]

I'm in the middle of cycling my 10g. One of the live rocks that I bought had a leathery growth on it which looked pretty dead so I picked most of it off before placing it in my tank.

Here it is 2 weeks later and the leathery growth is falling to pieces... And so is the rock.

I rubbed it gently and it fell apart easily. It looks like it was throughout the rock, but I don't know of any species that do that (says the newb).
Anyone have a similar experience?

 

[Kodi01]

You can see on the right its inside the hole of the rock

 

[recess62]

The "live rock" I purchased from my lfs wS not cured. N there was a large amount of white detritus that sluffed off the rocks as the tank cycled. Once the tank cycled the cuc had a feast