Carat Clients Not Poached by French Start-Up, Court Rules

12 January 2005

A French commercial court on Tuesday exonerated Paris-based start-up KR Media of charges of enticing Carat France clients into its fold in contravention of service agreements.

KRM, in which WPP Group has a 20% stake, was launched this time last year by two former Carat executives - Eryck Rebbouh and Bruno Kemoun - who quit the Aegis-owned agency after 'strategic differences' with global chairman/ceo Doug Flynn. Their service contracts prohibited the pair from approaching any Aegis client within twelve months.

The Aegis case rested on the fact that several Carat clients - among them luxury-goods conglomerate LVMH, chocolatier Ferrero and telecoms giant Bouygues Telecom - chose at various times over the past year to relocate their business at KRM.

Aegis promptly filed a lawsuit naming the departed duo for alleged 'poaching' and breach of contract. This culminated last month in a raid on KRM's offices by Carat-hired investigators seeking documentation to prove the charges. By coincidence, a newspaper photographer was sited outside KRM's office to record the scene.

But the raid was fruitless, with not a shred of admissable evidence found - to the obvious irritation of the court which opined that the allegations against KRM were made purely to obtain sensitive information about its finances and commercial strategy.

Moreover, the court slammed Aegis/Carat for failing to supply a list of the parties involved in the raid on KR's offices. "The allegations of Carat are based on no other document than press cuttings," concluded the court..

Carat was ordered to pay all costs of the action and told it faces daily fines of up to £9,000 unless data and documents seized in the raid are returned immediately.

Those close to the Aegis scene say that the debacle will do little to improve shareholders' relationship with Flynn, a tad on the edgy side since their recent differences about the term of his £1.2 million ($2.25m; €1.72m) rolling contract.

Flynn favours two years; the shareholders one - acutely conscious of the moolah that would change hands if the company was taken over.

Which, given the interest shown in Aegis by French corporate raider Vincent Bolloré [WAMN: 22-Dec-04], is a scenario on which the odds are shortening daily.

Data sourced from; additional content by WARC staff