Businesses
Former Scangroup CEO Bharat Thakrar files Sh4.3 billion lawsuit over ouster
Monday March 25, 2024
Former Scangroup CEO Bharat Thakrar has sued the company’s UK-based parent company WPP Plc, its subsidiary WPP Scangroup and all its directors in a Nairobi court for alleged loss and reputational damage, emotional and mental related to the events following his suspension from the company. he founded.
He is seeking more than half a billion shillings from Kenya, plus potential loss of income if he were still CEO of Scangroup, as well as damage to his reputation which British media say could result. amount to about £24 million (Sh4.3 billion). ), if the request is successful.
Mr Thakrar, who still holds a 10.49 per cent stake in WPP Scangroup, sued the multinational advertising company and also accused the UK-based advertising agency of losing a significant business opportunity to generate income through his children’s business where he was a consultant.
Read: Ousted Scangroup CEO eyes Sh4.3 billion lawsuit in fallout dispute
WPP, it is claimed, made other defamatory and false statements to Airtel Africa which collectively could be taken to mean that it was guilty of the allegations made against it.
“I also believe that as a result of WPP’s interference in a potential business relationship between Airtel Africa Plc and me, I have assigned the full value of the potential business,” he said in an affidavit.
Mr. Thakrar is also seeking a permanent injunction to prohibit the defendants and their agents from continually publishing defamatory expressions against him and an order for the parties to retract the allegations without reservation.
It accuses WPP and its Kenyan subsidiary of “conspiring to undermine its status and reputation as founding shareholder, director and CEO of WPP Scangroup”.
His suspension, he claims, was the result of a “clandestine investigation using illegal means.” Mr Thakrar claims WPP manipulated itself to be able to control the board through additional directors, thereby breaching Capital Markets Authority (CMA) guidelines that there are one in three independent directors.
“The plaintiff’s causes of action arise from the 1st defendant’s (WPP Plc) unlawful interference with contractual relations…and/or unlawful inducement of breach of contract in respect of the plaintiff’s contract with the 2nd Defendant (WPP Scangroup),” the suit documents state. .
Mr Thakrar argues that WPP Plc and WPP Scangroup breached their duty of care not to act in a manner which would have caused him financial loss, loss of reputation and invasion of privacy in his capacity as founding shareholder, director and CEO of the company.
The directors, including two local board members at the time, Richard Omwela and Pratul Shah, are being sued for breach of fiduciary duties and willfully and negligently allowing WPP to interfere in WPP’s internal affairs and allowed WPP to control the entire investigation process. .
They are also accused of failing to disclose to the CMA the extent of WPP’s involvement and that of Jon Eggar who was the chief financial officer (CFO) during the financial years under investigation.
Mr Thakrar accuses the company’s directors that, although they had not seen a draft report prepared by Control Risk and in breach of their statutory duty to act independently, they approved the resolution aimed at suspending it.
He claims that instead of submitting to a clearly predetermined process, he chose to resign as CEO on March 23, 2021.
He describes the resignation as “non-voluntary”. The entire process of his ouster and investigation, he claims in court papers, was led by Andrea Harris, chief counsel of London-based WPP Pls, although the board appointed a committee to manage this process.
Read: Scangroup investigation clears ex-CEO Bharat Thakrar
He further claims that Andrea Harris frequently attended Scangroup board meetings to inform the board of directors about the investigation.
Upon his departure, Mr Thakrar was ordered to complete the transfer process by handing over all items to Ben Kelly, Head of Risk at WPP.
It further accuses WPP of protecting Jon Eggar, the former CFO during the period under the alleged investigation, who was neither negatively mentioned in the internal investigation report nor sanctioned, claiming that WPP’s actions were motivated by racial prejudice and neocolonialist practices. He contends that these actions were discriminatory, contrary to Article 27 of the 2010 Constitution of Kenya.