Interpublic Drops Lawsuit Against Omnicom

09 October 2001

The lawsuit filed by Interpublic Group last week against Omnicom Group, DDB Worldwide and Brian Williams, former president at IPG unit FCB Chicago [WAMN: 05-Oct-01], was dropped on Friday.

IPG claimed Williams had breached his contract with FCB when the latter lost $350 million of PepsiCo business last month to Omnicom [WAMN: 24-Sep-01]. Williams subsequently resigned to head a new unit linked to Omnicom’s DDB network which was to oversee the duties, mostly for Quaker Oats and sports drink Gatorade.

Interpublic appealed for a temporary restraining order against Williams, claiming he was soliciting FCB employees to move to his new shop. A judge at Cook County Circuit Court turned down the motion, and IPG subsequently dropped its legal action.

To succeed in its suit, IPG had to prove that Williams, Omnicom and DDB had conspired to convince PepsiCo to shift the duties and target key FCB employees. However, such claims were quashed by an affidavit submitted by Pepsi, revealing its decision was rooted in client conflict.

“PepsiCo was deeply uncomfortable continuing to work with an agency [FCB] that was controlled by the Interpublic Group of Companies, which had a significant client relationship with Coca-Cola, PepsiCo’s principal competitor,” said the soft drinks giant. “Our decision to terminate the FCB–PepsiCo relationship was not predicated on the availability, or lack of availability, of Brian Williams or any other FCB Chicago employee.”

With the legal obstacles cleared, Williams told he is pushing ahead with the new agency, which should be operational by the end of the 90-day transition period following the termination of PepsiCo’s contract with FCB. He added that Martin Sherrod and John Fraser, the FCB executives in charge of the Quaker Oats and Gatorade duties, would be joining his shop following their resignations on September 27.

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