Ad men called in for Patterson case
The Age
Saturday May 30, 2009
TWO of advertising's best-known identities - Hamish McLennan and Alex Hamill - are to be joined in the long-running court case of who knew what about secret payments made to executives during the sale of the ad agency George Patterson in 2005.In a startling development, the private equity company that is fighting an action by the London-based marketing services company WPP is turning the tables on its pursuer.On Thursday, the Federal Court gave Pacific Equity Partners the green light to sue Mr McLennan and Mr Hamill for misleading and deceptive conduct.As the judge noted in court: "Sounds like everybody is blaming everybody in this case."Mr McLennan is the New York-based chief executive of global ad agency Young & Rubicam Worldwide and is WPP's star witness.Mr Hamill is the former chairman of The Communications Group, which owned Patterson along with ten other companies. Pacific Equity sold its majority stake in The Communications Group to WPP for $80 million.Pacific Equity paid $1.5 million to two senior Patterson executives - Anthony Heraghty and James McGrath - to stay on at the agency for a year after its sale. WPP claims it did not know about the payments and would have paid less had it known that the executives might leave after a year.On Thursday, the Federal Court heard how Mr Hamill had revoked an affidavit he gave at the beginning of the action, in late 2006, saying he knew about the payments.In its cross claim lodged yesterday, Pacific Equity alleges every party knew about the payments and that WPP chose to ignore the fact, even though the Patterson executives were key to keeping important clients such as Foster's, Cricket Australia and NAB within Patterson's Melbourne office.The cross claim alleges that in the final days of negotiations on August 17 and 18, 2005, Mr Hamill made a telephone call and emailed Pacific Equity director Tim Sims, enlisting his support to retain Mr Heraghty and Mr McGrath.
© 2009 The Age
