Fogarty May Lose Lois

Fogarty Klein & Partners is looking to split from financially troubled Lois USA amid speculation that the parent firm’s Chicago office will be shuttered.
“It’s one of those situations that’s evolving every day,” said Bill Fogarty, a principal at the Houston agency. “Basically we’re considering several alternatives having to do with a separation of some sort.”
Sources close to the agency said Lois is in some cases months behind on media payments. Chicago executives were said to be shopping their services and some key clients. Officials at New York-based Lois USA, including president Ted Veru, could not be reached for comment last week.
Lois’ plum account–formerly at the short-lived Fogarty Klein & Partners 312 in Chicago–is Barton Beers, distributor of Corona in 25 Western states. “Barton brands is gone,” one insider declared. An official at Barton, headquartered in Chicago, said the company expected to have something to say about the situation this week but declined further comment.
Corona spends about $20 million a year on ads. The Richards Group in Dallas handles advertising in the Eastern states through Gambrinus importers. Media is also split, although Lois has handled the bulk of that business.
Lois USA merged its Chicago office with the former Eisaman Johns & Laws in 1996, forming Lois/EJL. The mix never worked culturally, leading to the split into Lois and FK&P 312 in March. Other clients include regional Valvoline work and the World Wrestling Federation.
Lois was hard hit by GM’s consolidation of its regional dealership advertising, which cost it one of its cornerstone accounts, and the subsequent losses of Sav-on and Osco drugstores.
Fogarty was acquired by Lois in Jan ’97. “Our intention at that time . . . was that they gave us access to additional capabilities and offices in different parts of the country where we weren’t actively involved,” Fogarty said. “We were in a position to maintain our independence as a corporation, which was appealing to us.”
Lois’ troubles have not affected the Houston agency, Fogarty said. “We basically are a separate corporation from Lois, which is positive for us.” –with Aaron Baar