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WPP Group’s lawsuit against web-based TV creative ad agency Spot Runner for securities fraud and breach of contract has been dismissed, sources close to the legal dispute tell paidContent. WPP, which helped lead a $40 million funding in the Los Angeles company about three years ago, accused Spot Runner of failing to disclose a stock sale to other shareholders. The Dublin-based ad holding company said it was prompted to sue when it was told that Los Angeles-based Spot Runner used word of WPP’s stake in it to attract other investors. Representatives from both companies did not respond when asked for comment.
Update: WPP has until next week to “replead” its complaint. The agency is currently planning on appealing this ruling and having its case reinstated. In a statement, WPP said: “While we are disappointed in the decision of the Federal District Court with respect to our securities fraud claim claims against Spot Runner Inc. and the other named defendants, we continue to believe strongly in the merits of those claims as well as the other state law claims that the Court did not pass upon, and we remain committed to pursuing all of our legal remedies. In rendering its decision, the Court rejected important defenses offered by the named defendants and granted us ample opportunity to replead our securities fraud claims. We intend to take full advantage of this opportunity to replead.”
Among the allegations in the suit WPP filed in April, Spot Runner was accused of deceiving the company about a new investment round. In the decision by U.S District Court Judge Percy Anderson, the court concluded that WPP may have misunderstood the response from Peter Huie, Spot Runner