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Media Group Alleges Criminal Charges Filed Against 2 Senior Leo Burnett Execs

Feb 25, 2013, 21:19 IST

Publicis GroupePublicis' EmmerichAntenna Group, a small international media and entertainment company, says that a prosecutor in Greece has filed a criminal complaint against a Publicis Groupe svp and the CEO of Publicis' defunct Leo Burnett division in Greece over alleged unpaid bills that occurred when Leo Burnett went out of business in the troubled Eurozone country. Antenna owns TV and radio stations in the region.

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Publicis Groupe svp Mathias Emmerich tells us that his company was the one that initiated the inquiry, and that the case has merely been moved into the jurisidiction of an investigating judge. Antenna is overstating the seriousness of the move, Emmerich says, especially as it was Publicis that first acted to end what everyone regards as a "very stupid, very insane" scheme involving a large number of Greek agencies.*

Leo Burnett tanked in Greece after it walked away from a 200 million euro deal with Alter, another TV company. According to More About Advertising, Burnett had made an advance purchase of a huge block of TV airtime with Alter, which it then intended to sell on to its clients. As the recession struck, those clients did not want to buy the time, and Burnett floundered. Clients in Leo Burnett's Greek roster included Procter & Gamble and Samsung. The agency offered its creditors, including Antenna, a percentage of the full amount owned but Antenna declined.

Antenna filed a complaint with Greek prosecutors last year, against Emmerich, the former chairman and managing director of Leo Burnett, and Petros Venetis, former CEO of Leo Burnett Greece. Ad Age reported last year that Publicis had disciplined Venetis, but that the allegations against Emmerich were baseless:

The company was quick to distance itself from Mr. Venetis, who abruptly left his job as CEO last July. A Publicis spokesperson in Paris said, "When we discovered the reckless and fraudulent commitments that had been made by Petros Venetis, we immediately dismissed him and filed proceedings with the criminal court."

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But the complaint against Mr. Emmerich is "groundless," Publicis said. "Every step we took was under the supervision of the Greek judicial authorities, to whom the matter has been referred from the start of the difficulties in July and who pronounced several decisions on this case."

Here's the full text of Antenna's press release:

Athens/London: The Public Prosecutor of Athens has criminally prosecuted senior executives of the Publicis Groupe following a criminal complaint which was filed by the Antenna Group in April 2012. The felony charges include fraud of a high value and acting in complicity under aggravating circumstances. These criminal offences can be punishable with imprisonment of up to 10 years under the Greek Criminal Code.

Commenting on the Prosecutor’s decision, Alexander Holland, Chief Operating Officer of Antenna Group said, “We are pleased that Greek authorities have decided to pursue our case, reflecting the seriousness of the offences committed against Antenna. This decision strengthens our belief that we, along with other TV and radio stations, have been unfairly treated by Publicis’ decision to close Leo Burnett Greece, causing a great deal of instability in the Greek media sector. I consider the behaviour of Publicis highly unusual, especially considering that they continue to be active in Greece with another subsidiary. As the criminal investigation has now fully launched, we are hopeful of a favourable outcome for the Antenna Group. ”

The complaint was made against Mathias-Benjamin Emmerich, Chairman and Managing Director of Leo Burnett and a senior executive within Publicis Groupe and Petros Venetis, former CEO of Leo Burnett Greece and. It was made following the Publicis Groupe’s decision to close its Leo Burnett agency in Greece and withhold payments due to media companies for television and radio campaigns.

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*This story was updated with comments from Emmerich at 2.07 p.m. on Feb. 25.

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