Simon Kelly, Julian Treasure and Christopher Lee, the main shareholders of TPD, since rebranded as Just, have filed an action in the Federal District Court for the Southern District of New York. They allege IPG was responsible for "breach of contract", "breach of warranty", "intentional misrepresentation" and "fraud ".
TPD was sold to IPG for around £5 million in 2001, 50 per cent of which was paid in IPG shares. Just days after the deal was done, IPG issued a profits warning related to an overstatement of its financial results, leading to sharp declines in its share price.
The three plaintiffs allege that IPG misled them by misrepresenting the nature of its "business, operations and financial condition" during the acquisition negotiations.
IPG unsuccessfully tried to have the case dismissed. It has now been put before a magistrate judge to work towards any possible settlement.