Blamer Has To Cool His Heels Before Joining FCB

There he goes again.

That was industry reaction to the news that Grey will not let departing North American CEO Steve Blamer out of his contract, which expires on June 15, to join Foote Cone & Belding as planned this month.

The “he” in question is Grey’s almost-owner, WPP Group CEO Martin Sorrell. While Sorrell cannot officially influence or enforce employee contracts at Grey until his deal to acquire the agency is finalized, the scenario looked all too familiar to some.

In 2002, WPP filed a lawsuit in London against HR chief Brian Brooks to ensure that he observed his two-year noncompete clause. The case was eventually settled out of court, and Brooks joined IPG in November of that year.

Last year, Lee Daley, then CEO of Red Cell, had to serve several months remaining on his contract even though he had resigned without accepting another job, sources said.

It surprised some that Grey would rather cough up full compensation for the next six months than let Blamer join the competition. It is believed that from now until the June 15 expiration, Blamer will be paid out over a million dollars in compensation. “With Martin, it’s not about the money,” commented one source. “If these efforts compromise a competitor, it’s money well spent.”

As for Grey Global Group CEO Ed Meyers, one source said: “Paying someone that kind of money to stay home would make Ed’s head explode.”

In a memo to Grey staffers last week, Meyer, 78, explained why Blamer was clearing out (but still getting paid for the duration of the contract). “Steve is committed to becoming a competitor,” he wrote, and his presence at the agency or his immediately joining FCB would be “problematic to our clients and our stakeholders.”

Rick Kurnit, a partner with New York law firm Frankfurt, Kurnit, Klein & Selz, said the British refer to such an arrangement as “garden leave. It gives the company protection for its confidential information.”

WPP and Sorrell declined comment, but a Grey rep said of Blamer’s situation: “This is totally consistent with the agreement that Steve negotiated and signed.”

Blamer, who vacated Grey’s offices last Monday, last month accepted the worldwide CEO post at Interpublic Group’s FCB, where he will eventually succeed Brendan Ryan.

Meanwhile, the question of leadership at Grey Worldwide is getting cloudier. Even when Blamer was the lead horse to succeed Meyer, two of his colleagues—Joe Celia, worldwide CEO of G2 and president of Grey Synchronized Partners, and London-based Carolyn Carter, who runs the EMEA region—were also being considered, albeit as distant runners-up.

According to SEC filings, Meyer’s successor must be named within six months of the WPP/Grey close.

WPP’s $1.3 billion acquisition of Grey Global Group is expected to close this quarter.