Ad firm bids to delay ex-boss starting work for rival

A giant advertising company has taken court action to stop its former chief executive beginning work immediately for a rival, it emerged today.

In a case which has sparked massive interest within the industry, Carat Ireland is seeking to enforce the ‘gardening leave’ provision in the contract of its former chief executive Alan Cox.

The company went to the High Court last week to prevent him taking up work straight away as chief executive with a rival agency, Starcom Mediavest Ireland.

The court heard Mr Cox had been on an annual salary of €200,000 and was responsible for one third (€34.5m) of the company’s €83m turnover.

Barrister Rossa Fanning said the executive had informed the company on March 8 that he intended to resign and that he did not accept that the provision for 12 months ‘gardening leave’ in his contract applied to him.

He said his client would claim there were two clauses in the executive’s contract which would give us the legal right to prevent him working for a rival competitor.

“It’s a matter of some urgency from the point of view of my client,” he said.

The identity of the company and the executive involved was not disclosed in the initial court application last Tuesday.

But Carat Ireland and Mr Cox were named in the courts list two days later when the motion came up in the High Court again.

Carat Ireland is owned by Aegis, the largest independent media and marketing research company in the world. It carries out advertising work for a number of high profile Irish companies, including Vodafone.

Starcom MediaVest Ireland, the company which Mr Cox is joining, carries out advertising work for Vodafone’s main rival, 02.

A senior advertising industry source said that companies worldwide were extremely concerned about highly-placed executives defecting to rivals with potentially sensitive information.

“A lot of what we would do in our business would be making plans for new products that would be in development and might be coming out in three or six months. So there’s a lot of forward planning and things that would be quite sensitive if they got into the marketplace,” he said.

Under gardening leave provisions, senior executives are sent home on full pay and are not allowed to begin their new job for an agreed period.

The use of gardening leave is standard practice in the advertising industry worldwide but this is believed to be the most high-profile case of its kind here.

Neither Carat Ireland nor Starcom MediaVest Ireland returned calls seeking comment.