Rotten Oak - Wet and Orange

I found a rotten oak tree on the ground that I was gathering for my grubs. Some of the wood is really wet, darker orange and kinda shreds stringy. When I squeeze it in my hand orange water comes out of it. I'm not sure if it's just too wet, in a different stage of decay, or if something was wrong with it. I've never run across this before, so I just wanted to make sure it was safe for my grubs.

 
Sounds like it is fairly normal oak that is just very wet, if you let it dry out if should be useable.

 
I have found this wood too. It's usually from stumps of branches that have been laying on the ground and many times has a few Bess beetles in it. Yes I've used this wood for sub with no problem. Though I prefer to collect dry white oak that crumbles in my hand.

 
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