I had originally posted that this was a bacterial infection. Technically, that is incorrect.
Read:
Orchid Diseases especially the part on black rot, and read the provided links on black rot. Technically, this is considered a "water mold", which is not a bacteria, but is not really a fungus either.
My advice on treatment remains the same, except that later treatment with Physan will likely do nothing to help. Treatment with hydrogen peroxide may help (See
http://www.staugorchidsociety.org/PD...ySueBottom.pdf; There are also some pricier specialty chemicals that may also help:
http://www.staugorchidsociety.org/PD...idDiseases.pdf Isolation from other plants is also recommended.