Sorrell vs. Benatti: the High Court Rematch

Admen Square off in London for Second Trial

By Published on .

LONDON ( -- London's High Court is hosting another showdown between WPP Group Chief Executive Martin Sorrell and Marco Benatti, WPP's former manager for Italy.

The two clashed last year when Mr. Sorrell brought a libel action against Mr. Benatti, accusing him and his colleague Marco Tinelli of circulating a computer-generated image of Mr. Sorrell and former WPP Italy Chief Operating Officer Daniela Weber. The picture was labeled "the mad dwarf and the nympho schizo."
Marco Benatti
Marco Benatti Credit: Eric J Lyman

The acrimonious case was settled when Mr. Sorrell and Ms. Weber accepted almost $300,000 in damages in March 2007, although Messrs. Benatti and Tinelli accepted no responsibility for the e-mail.

Accused of being a 'secret beneficiary'
This time around, WPP is suing Mr. Benatti for breach of "fiduciary duty," accusing him of being a "secret beneficiary" of a $30 million takeover of Media Club, an Italian advertising agency, in 2002.

Mr. Sorrell is expected to take the stand early next week. Today, Laurence Mellman, chief operating officer of WPP agency network United Group, who was in charge of mergers and acquisitions at WPP headquarters during the Media Club takeover, is in court.

WPP has accused Mr. Benatti of not declaring his large holding in Media Club, but Mr. Benatti claims that Mr. Sorrell had always known of his stake in Media Club. WPP is seeking more than $22 million in damages over Mr. Benatti's alleged deception.

Mr. Benatti is countersuing for unfair dismissal, claiming that Mr. Sorrell sacked him in 2006 because he fell out with Ms. Weber, with whom he alleges Mr. Sorrell had a personal relationship.

Commissions and earnouts
According to published sources, Mr. Benatti, whose job at WPP was to identify acquisition candidates, earned a commission of $247,000 for introducing Media Club to WPP. He also asked for an earnout of nearly $11 million, about $10.6 million more than WPP thought he was owed.

In a document submitted to the court, Mr. Benatti's lawyers wrote, "It is alleged that he was obliged, but failed, to disclose his interest, and that he owned the greater part of the company. All three points are entirely denied."
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