LONDON: A disgruntled UK businessman who sold his sales promotions company in 1997 to Interpublic Group and was paid mainly in IPG stock, has sued the US ad giant for misrepresenting its financial performance.
Scheduled to be heard in London's High Court on October 15, the case is expected to last some eight days and feature a number of high profile witnesses - one of whom could be IPG's [then] chairman/ceo John Dooner, these days enjoying a more tranquil existence as ceo of McCann-Erickson.
The case is brought by Barnet Fletcher, former owner of Barnett Fletcher Promotions, now integrated into McCann's Momentum network.
He alleges he was misled as to IPG's financial situation at the time and that the holding company's directors knowingly overstated its performance in key regions, including Europe.
In 2002 the ordure hit the fan when IPG was compelled to restate its financial results, severely depleting the value of its shares and the stock held by Fletcher
The case - if it comes to court - could uncover new revelations over the way in which Interpublic handled its finances at the time.
IPG's lips are zipped regarding the case, but "insiders" have let it be known that the case will be "vigorously defended".
Although they will concede that mistakes were made, IPG's lawyers will argue that these amounted to "poor control of systems", rather than any attempt to deceive.
It is not known whether IPG's incumbent chairman/ceo Michael J Roth will be among those giving evidence. He assumed the helm of the company in June 2004 and is therefore seen as aloof from the financial fray before that time.
Data sourced from BrandRepublic (UK); additional content by WARC staff