Ad agency CEO accused of 'constant racist and sexist slurs' against his staff resigns

D Dipasupil/Getty Images for AWXII)J. Walter Thompson Company Worldwide Chairman & Chief Executive Officer Gustavo Martinez poses at the The Latino Spring panel during Advertising Week 2015 AWXII at the Times Center Stage on September 29, 2015 in New York City.

The CEO and chairman of ad agency J. Walter Thompson (JWT,) who was accused in a lawsuit filed by a colleague of making "constant racist and sexist slurs" has resigned.

JWT parent company WPP confirmed in a statement that Gustavo Martinez has left the company "by mutual agreement ... in the best interest of the J.Walter Thomson Company" and will be replaced by the agency's chief client team officer Tamara Ingram, with immediate effect.

The complaint, filed by the ad agency's chief communications officer, Erin Johnson, in a Manhattan federal court last week, alleged Martinez referred to black people as "monkeys" and once beckoned Johnson to come over so he could "rape [her] in the bathroom."

Martinez denies the allegations.

WPP earlier this week hired outside law firm Proskauer Rose LLP to carry out an independent investigation into the matter, The Wall Street Journal reported.

That followed an amendment to the initial complaint filed by Johnson's lawyers, which criticized WPP's response to her complaints. Johnson's lawyers also wrote to the judge to say they will be entering a video from a meeting in Miami in May 2015, where they allege Martinez was filmed making racist remarks.

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