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Doner Staff Call for Criminal Probe of CEO Kalter

Doner CEO Alan Kalter is being subjected to an online witchhunt by his own staff over his failure to disclose the existence of their pension plan; he also announced the "retirement" of his CFO Barry Levine. In dozens of comments on Ad Age and AgencySpy, anonymous posters are urging Doner staff to contact local prosecuters with requests to investigate the agency chief for his mishandling of the agency's pension plan.

Separately, the exit of CFO Levine from the agency is being widely interpreted as an attempt by Kalter to deflect blame for the pension scandal. Levine worked at the shop for 33 years, but instead of publishing a glowing tribiute to his service, Kalter gave his departure a single sentence inside a memo dedicated to the promotion of someone else:

As CFO, Larry [Kempa] succeeds H. Barry Levine, who has elected to retire.
BNET noted last week that Kalter sent a memo to Doner staff apologizing for not disclosing to them the existence of the pensions to which they were all entitled.

Kalter claims that the plan is fully paid up and that the only mistake was failure to disclosure its status. The key question now is, How much money is in the plan, and is it enough to cover all Doner's past and present employees, plus Levine, plus ex-COO John DeCerchio, who claims as a former partner he is owed $55 million? (Doner's annual revenue is just $182 million.)

A potential answer to that question could come during the discovery phase of ex-CMO Bryan Yolles' suit against Doner, assuming Yolles declines to be paid to go away. (Read Yolles' lawsuit v. Doner here.)

Unsurprisingly, Kalter's staff are venting their anger online. In a long strong of comments on AgencySpy, reader after reader calls for a criminal investigation of Kalter. Here's one:

Agency Mole 15 hours ago: ... I've spent all day contacting law enforcement officials and local news media. This is just about to break out of blogland and into the mainstream. Sorry, but I'm enjoying this so very much. And picking up a paycheck at Doner too! We're coming for you, Alan.
A close examination of these posts indicate that many of them, including Agency Mole and Puckhog, appear to be sock puppets wielded by someone who really, really wants authorities to ask Kalter to help them with their enquiries. Still, there are enough posts on AS and Ad Age (here and here) to suggest that a full-blown mutiny is seething beneath the surface at Doner.

Full Kalter memo after the jump.

Dear Colleagues,

It's been said that change is the only constant in business. It's also been said that winning teams have a deep bench. Both statements are true and very relevant to today's announcements.

As I said in this morning's Town Hall, it's my great pleasure to announce the appointment of three new senior partners, all current Doner leaders, who will join me as your New Leadership Team effective immediately:

-- Tim Blett, a Donerite since 1986, continues as President of our Newport Beach branch and becomes Senior Partner. In the 11 years since Tim took leadership of this office, it's become the fastest growing agency in Orange County. He will bring his energizing force and leadership to the entire agency.

-- David DeMuth, currently Executive VP and Chief Strategy Officer, becomes our Senior Partner, President-Chief Operating Officer. In his 20-year tenure at Doner, David has used his insightful business sense and leadership to develop creative business solutions to build client's businesses. He will be our chief architect to steer our transformation into a new kind of agency.

-- Rob Strasberg becomes Vice Chairman and Senior Partner while retaining his current title as Chief Creative Officer. After eight award-winning years at Crispin Porter + Bogusky, Rob joined Doner in 2008. During the last 14 months, his creative leadership and vision have propelled our creative product to stand up to the best agencies in the world while honoring our great heritage.

In addition, I announce new important advisors to your new leadership team. The first is Larry Kempa who I have promoted to Executive VP-Chief Financial Officer, effective immediately. As our corporate controller, Larry supervised the agency’s implementation of the Oracle financial system across our worldwide offices and streamlined our financial reporting processes. He is not only well-qualified to take this position, but he is widely respected by our employees and external partners. As CFO, Larry succeeds H. Barry Levine, who has elected to retire.

To help us improve how we communicate about our own brand, we have hired Kate MacArthur as Senior VP-Brand Content Director. In the past decade, Kate broke some of the biggest stories in marketing and advertising, with many for Advertising Age. She also brings a dozen years of marketing communications experience for such companies as Deloitte & Touche and Rhea & Kaiser. She will work closely with our management team to improve our brand image and social media efforts.

I’m also pleased to report that we’ve begun the search process for a Chief Talent Officer. A new position for us, Doner’s Chief Talent Officer will combine traditional human resource functions with training, internal communications and culture development. It will thus be a critically important position, and one that signals our commitment to take the next step in our company’s development.

This team will help me manage our business and enhance the creativity, stellar client service and efficiency for which Doner is known.

The Next Generation of Leadership

Our new management team represents the continued legacy of growing the next generation of leadership from within the ranks. Doner’s long-term success has always been built by developing our people to carry forth our culture. It’s how we’ve thrived amid numerous challenges and delivered outstanding results and excellent service to clients for decades. It’s time for our next generation of managers to lead our mission to help us be an agency you are proud to be a part of and where we Make Something Happen.

As I wrote in my memo last Friday regarding the pension issue, I want to make sure that we avoid the communication problems that we’ve experienced in the past. I genuinely believe that many of our recent challenges result from our lack of proactive, open and responsive communication.

Going forward, I am committed to instilling a climate of openness at Doner. Since writing, Aon has committed that they will send out statements to plan participants by June 5; and this week I will meet with pension experts to determine what needs to be done to get our pension communications into compliance and then into best practices. We will be working hard to address your concerns and fix any problems that may have resulted from this issue.

As we continue to build on our legacy, our commitment to open communication will be central to our success. I am committed to creating more forums for conversation. In addition to our Town Hall today, we will be hosting others in the next few weeks to discuss our progress in our transformation, where our business is headed and the great work we’ve been doing. Please also consider my door open to all of you. Better communication means more talking but even more importantly, it means more listening. I want to hear from you so that we can better equip our company to be successful in this challenging environment.

If you have any questions, please feel free to email me at akalter@donerus.com.

Sincerely,

Alan

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