Cordiant Goes to Court to Bar Former Execs' New Firm
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Cordiant Goes to Court to Bar Former Execs' New Firm

Cordiant is going to court to prevent former Financial Dynamics executives Nick Miles and Hugh Morrison from setting up a competing business.

Paul Holmes

LONDON, February 24—Cordiant is going to court to prevent former Financial Dynamics executives Nick Miles and Hugh Morrison from setting up a competing business.
 
The two were dismissed from their positions as chairman and managing director respectively at Cordiant’s Business Communications International division in January. While neither side has commented publicly on the reasons for the dismissals, London newspapers have reported that Miles and Morrison clashed with Cordiant management over bonuses for staff.
 
Miles and Morrison are believed to be planning their own £5m legal action against Cordiant, seeking damages for loss of salary, bonuses, shares and options, and may also be challenging the non-compete clause that prevents them from setting up or working for a rival firm for at least six months.
 
Cordiant is so concerned that they may set up in competition with Financial Dynamics that it has applied to the high court for an interpretation of the contracts. The case will not be heard until mid-April at the earliest.
 
Miles and Morrison sold Financial Dynamics—one of the two top financial communications firms in the City of London—to Lighthouse in 2000. Lighthouse was sold to Cordiant later that year. Cordiant also owns New York investor relations firm Morgen-Walke Associates and Japanese firm International Business Information, and had combined the three firms under the Business Communications International banner, with Miles and Morrison at the helm.
 
Shortly after the dismissals, Cordiant announced it would take a £200 million write-down on the value of recent acquisitions, including Lighthouse, and speculation began that chief executive Michael Bungey might be forced to step down. There have also been rumors that Havas or Publicis might acquire all or part of the troubled company.        
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