Legal experts highlight rarity of Weber's suit

Weber Shandwick's move to take legal action against Hill+Knowlton Strategies for allegedly stealing confidential information, clients, and employees is one rarely seen in the industry, PR recruitment and legal experts tell PRWeek.

Weber Shandwick's move to take legal action against Hill+Knowlton Strategies for allegedly stealing confidential information, clients, and employees is one rarely seen in the industry, PR recruitment and legal experts tell PRWeek.

While it's common for agency executives to move to new firms, it's “fairly rare” for agencies to sue one another, says Linda Goldstein, chair of the advertising, marketing, and media division of law firm Manatt, Phelps & Phillips.

Weber has been granted a temporary restraining order against H+K, as well as its COO Ken Luce and EVP Jody Venturoni, both former Weber employees, for allegedly trying to lure other former colleagues and clients to H+K despite signing contractual agreements not to do so. Weber is demanding a jury trial, according to court documents obtained by PRWeek.

Goldstein notes that cases like this are usually resolved through settlement, not litigation, because it's difficult to prove whether or not a client or employee left an agency on their own or if they were solicited.

“Often there is a relationship between a client and an executive, and the client will determine on their own that they no longer want to stay with that agency,” she explains. “There is not a contract in the world that will tell a client that they cannot move their business should they choose to do so.”

Goldstein adds that cases like this don't often go to trial because the agencies may receive negative backlash from information revealed during the proceedings.

“A natural consequence of this is that dirty laundry will be aired,” she says. “I don't think any agency typically enjoys airing its laundry, so you have to think of the PR consequences of this kind of public dispute.”

Elisabeth Rutledge, SVP at H+K, declined comment. Weber has not commented on the matter.

Jay Jaffe, president and CEO of Jaffe PR, an agency that specializes in working with law firms and legal organizations, also says it is unusual for Weber to take legal action because agency executives switch firms all the time.

“As long as there are PR firms and ad agencies, you will always have issue like this,” he notes. “Employees come, employees go; clients come and clients go.”

Jaffe adds that bringing a case like this to trial is not “practical” and it could cause the agencies involved to be distracted from their businesses.

He explains that all of his employees sign non-compete clauses, but that proving “that the violation of the non-compete actually caused financial damages” is challenging because it's difficult to put a financial value on how much privileged information is worth.

To prevent legal conflicts, Jessica DiScipio, manager and executive recruiter at Phifer & Company, said her firm conducts a thorough check of what accounts an executive works on and what documents he or she has signed.

However, she adds that this precautionary measure can be complicated since so many agencies work with similar clients or different brands within one company.

“The PR world is very small,” she says. “Everyone does switch agencies and they always stay within their realm. If they have a background in consumer or healthcare, they're going to go into an agency with that background, so they're kind of stuck.”  

Procter & Gamble has a policy stating that if an executive is working on a brand at one agency, he or she cannot work on a P&G brand at another firm. DiScipio says she thinks that “is a very smart tactic of business with the turnaround in the PR world.”

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