Saatchi Reaches Settlement With Michael Burns

Renegade Exec's Battle With Publicis Agency Ends After 18 Months

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NEW YORK (AdAge.com) -- After 18 months of battling in New York State Supreme Court, former Saatchi & Saatchi Vice Chairman Michael Burns has reached a settlement with and his ex-employer. According to a press release issued today by Saatchi, the agreement resolves all legal claims and disputes between the two parties.
Former Saatchi & Saatchi Vice Chairman Michael Burns has reached a settlement that ends his former employer's suit against him.
Former Saatchi & Saatchi Vice Chairman Michael Burns has reached a settlement that ends his former employer's suit against him.

'The past'
"I'm thrilled with the settlement and being able to put this suit behind me," said Mr. Burns, reached at his summer home in the Hamptons. "A gigantic burden's been lifted. I still have many friends at Saatchi and I wish them well. But Saatchi represents the past."

The highly publicized disagreement began on Feb. 11, 2005, when Mr. Burns, a 25-year veteran of the Publicis Groupe agency, resigned his post. Three days later, on Feb. 14, 17 Saatchi employees, all of whom worked with Mr. Burns on the agency's General Mills account, quit en masse, setting off a whirlwind of speculation about General Mills, a longtime Saatchi client, leaving the agency as well.

General Mills account
General Mills stayed put. But in March, Saatchi sued Mr. Burns, charging him with violating his fiduciary duties and duties of loyalty. The agency sought damages of more than $3 million and also sought to bar Mr. Burns from launching a company or taking a job with any advertising, marketing or communications firm that serves General Mills. Among the claims Saatchi made was that Mr. Burns bad-mouthed Saatchi to colleagues and plotted to unseat the account from the agency.

Mr. Burns in May countersued Saatchi. His lawyers called Saatchi's suit "an effort to besmirch the employee's good name in an attempt to ensure that he never works again." He sought to have Saatchi's suit dismissed.

Creation of One Seven
While Mr. Burns and Saatchi fought their legal battles, Mr. Burns' 17 colleagues joined Interpublic Group of Cos., creating an agency called One Seven. Led by Anne Adriance, Mr. Burns' longtime No. 2 at Saatchi and a founder of Saatchi's KidConnection unit, the New York-based agency offers creative and strategic services as well as media, in conjunction with other Interpublic companies. Its clients include McGraw Hill's BusinessWeek magazine, ConAgra's Hebrew National, Dun & Bradstreet, Educate Inc., and Unicef. Mr. Burns, who has been a consultant to One Seven since February, is now operating chairman of One Seven.

New York State Supreme Court judge Herman Cahn denied Mr. Burns' motion to dismiss the case in January, but did allow Mr. Burns to pursue employment in the advertising industry. Saatchi was able to pursue its case on grounds of breach of fiduciary duty and breach of duty of loyalty.

Interpublic
Saatchi & Saatchi and Interpublic in a jointly issued release said that all disputes between Saatchi & Saatchi and various individuals who left the agency that fateful February have been resolved, meaning that Saatchi is not pursuing legal action against any of its former employees.
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