WPP says it will “defend itself vigorously” against a slew of lawsuits in the US led by Levi & Korsinsky and filed in New York. It says “No court has ruled that we have violated any laws.” Which they haven’t – so far.
This stems from a profit warning in the summer which saw WPP shares plummet 18.8% and CEO Mark Read announce his departure. He’s since been succeeded by long-serving WPP non-executive directive Cindy Rose (below), a former Microsoft executive.
Levi & Korsinsky’s case involves sharply declining fortunes at WPP Media. The final straw for Read was losing Mars’ $1.7bn global media account to Publicis.
The nub of the question is whether or not WPP reallu believed its revenue would decoline by around 2% over the year – as it forecast – or it was aware that very bad news was coming down the line. Either way this is the last thing Rose needs as she tries to turn around what was once the world’s biggest ad holding company.
WPP shares opened lower this morning, valuing it at £3.76bn. At one point it was worth a dizzy £25bn.
