Corporate Law

Seven lessons that can empower your organization when Choosing A Corporate Attorney

Corporate Attorney

It isnt clear which agencies are the subject of the governments inquiry. Many of the big agency holding companies, including WPP PLC, Omnicom Group Inc., Interpublic Group and Publicis Groupe SA, have in-house production and postproduction divisions. Representatives of WPP, Interpublic, Omnicom, and Publicis declined to comment. Nancy Hill, chief executive of the American Association of Advertising Agencies, a trade group that represents agencies, said in a statement: It goes without saying that we require our member agencies and their staffs to follow the letter of the law. The Justice Departments probe adds a layer of controversy to an industry in which trust between the major parties in the estimated $529 billion global ad business is already fraying. In June the Association of National Advertisers, a trade group that represents big advertising clients, released the results of a seven-month probe that found agencies are shortchanging clients through nontransparent business practices. The groups report, which didnt point to specific ad agencies, detailed a range of suspect practices, such as agencies getting rebates from media sellers for reaching spending thresholds on behalf of their clients. Big ad companies have denied wrongdoing. The report has caused marketers to launch a wave of audits of their media-buying contracts with agencies. Ms. Meiklejohns inquiry has some ties to the ANA transparency probe. Shortly after the groups report was released, she contacted people close to the probe to see if they uncovered anything related to the bid-rigging allegations she was already investigating, said several of the people familiar with the matter. K2 Intelligence, the corporate investigation firm that conducted the trade groups probe, uncovered allegations of bid-rigging in the postproduction business, according to people briefed on the matter. That material was spelled out in an early draft of the report but didnt make it into the final version, which was focused on the media-buying business.

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