Grey Wins Bid to Keep London Documents Secret

Last Updated Jun 11, 2009 1:47 PM EDT

Grey Group has won a court ruling to keep secret a set of internal documents in a lawsuit that alleged client over-billing at its London office in the 1990s. The ruling also dismisses the case.

Grey has always maintained that the documents don't describe over-billing, and that the lawsuit was a frivolous attempt at revenge by an embittered employee who was fired by the agency.

New York State Judge Ira Gammerman ruled that the documents were improperly obtained from Grey by a former employee who broke a confidentiality agreement, and "the only justification for allowing [the documents] to become a part of the public record in this case, and thus provide access to the press, is to harm or embarrass the Grey defendants in some manner." ("The press," in this case is me -- I filed a motion to unseal the documents in 2006.)

The suit was originally brought by Grey's former evp/print chief in New York, Mitch Mosallem. He was fired by the agency and pled guilty in 2003 to charges of bid-rigging, kickbacks and charging clients excessive bills. Mosallem served 70 months in federal prison. While in prison, Mosallem sued Grey claiming the agency breached his attorney-client privilege to frame him.

Mosallem's suit alleged that in addition to his own kickback scheme, the London office of Grey had "a global arrangement involving kickbacks, bid-rigging, discounts and client over-billing in the form of cash, free work and other benefits," and that it kept "corporate discounts and rebates it received" from printers "that were not passed on to its client[s]." To back his claim, Mosallem filed with the court a collection of documents that purported to be evidence of the scheme. Mosallem also threatened WPP chief Martin Sorrell that if he didn't settle quickly he would release the documents.

Grey denied the complaint in its entirety and moved to seal the documents, on the grounds that many were confidential and that they were irrelevant to Mosallem's legal claims. Grey also argued that if the public were to see the documents, there was a risk they would misunderstand them or interpret them wrongly.

The judge's ruling gives few clues as to what is inside the documents. It states that some:
... were produced by Grey to the government in response to grand jury subpoenas ... most of these documents relate to an unfair dismissal proceeding brought in London by Roy Wilson, the former Chief Financial Officer of Grey's London office.
Wilson was sacked in 1999 by Grey London, and sued the agency because, he alleged, "he was fired for making a disclosure to managers which they found embarrassing," according to Campaign. Grey said at the time there was no substance to Wilson's claims and he was simply looking for a payout to increase his redundancy package.

Other documents "are correspondence relating to Grey-London's termination of Chris Loizides of Cronulla Creative & Management Services Limited in October 1998, two of which are marked strictly confidential."

Still more are described by the judge as an inter-office memo from Grey's general counsel to Mosallem and other executives and "an internal memorandum from [former vice chairman Bob] Berenson to [former chairman Ed] Meyer discussing Berenson's thoughts in rejecting a business proposal made by a printing vendor."

For older Grey employees, the ruling will serve as a trip down memory lane. It mentions several former Grey executives whose names popped up in the Mosallem scandal in the early 2000s.

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