NEW YORK—Zeno Group, a subsidiary of Edelman, has filed suit against its former New York managing director Charlotte Wray and her new employer, Omnicom’s Brodeur Worldwide unit, claiming that Wray breached her fiduciary responsibility to Zeno and later attempted “to misappropriate Zeno's healthcare practice in its entirety.”
Wray left Zeno in June of last year to launch Mosaic Health Communications, a new division at Brodeur, which was seeking to diversify beyond its traditional technology public relations base and into healthcare. The departure contributed to a tough year for Zeno, which saw revenues decline by 16 percent in 2006 to around $16.7 million, sparking speculation about the future of the firm’s New York office.
Zeno chief executive Jerry Epstein attributes most of that decline to Wray’s departure, but insists that the firm is in good shape overall, with its west coast operations in particular performing strongly. Zeno recently made a series of new hires, including Mike Glickman, formerly of the Dilenschneider Group, as vice president in the corporate group; Matt Scampoli, a veteran of Schering Plough, as a vice president in the health group; Jerry Tolk as a senior vice president in New York, from Euro RSCG Magnet; and Mike Waterman as a vice president in the corporate and health groups from Cohn & Wolfe.
In a complaint filed in New York Supreme Court, Edelman charges that Wray, “while still employed by Zeno, knowingly breached her fiduciary obligations… by stealing client relationships and diverting lucrative opportunities to her soon-to-be-employer, Brodeur; attempting to destroy files and records belonging to Zeno; and choreographing the ‘lift-out’ of key employees under contract to Zeno.”
According to Epstein, seven people eventually followed Wray to her new operation.
Meanwhile, others at Edelman say the episode left a particularly bad taste because it happened at a time when Epstein was hospitalized.
Brodeur chief executive Andy Coville denied any wrongdoing. “We hired Charlotte to create a start up healthcare brand. We never assumed or discussed for one minute that she would ‘take’ Zeno clients and staff. Because she is very good, they choose to continue to work with her. It’s unfortunate… they responded legally. Charlotte continues to do a terrific job building Mosaic. Nothing wrong or unethical was done here, which I am sure the legal process will bear out.”