WPP (LON:WPP) is facing a legal challenge with a US law firm preparing a class action against the advertising giant, The Times has reported. In a separate development, Reuters has revealed that more than a quarter of the group’s shareholders have voted against a pay report to be discussed at tomorrow’s general meeting, angered by benefits for the company’s former chief executive Martin Sorrell, according to Sky News reporter Mark Kleinman.
WPP’s share price has been steady in London in today’s session, having added 0.40 percent to 1,243.00p as of 08:40 BST. The group’s shares are outperforming the broader UK market, with the benchmark FTSE 100 index having slipped marginally into negative territory and currently standing 0.03 percent lower at 7,735.25 points.
WPP faces legal challenge
The Times reported this morning that American law firm Pomerantz was investigating claims on behalf of WPP investors in the wake of the resignation of Sorrell for alleged ‘personal misconduct’. The law firm explained that its investigation was into whether the ad giant “and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices”.
The investigation was triggered by Sorrell’s recent resignation following an inquiry by the company into allegations of personal misconduct and abuse of company assets.
In a separate development, Reuters reported that according to Sky News reporter Mark Kleinman, more than 25 percent of WPP investors had cast votes against the group’s remuneration report angered by benefits for Sorrell. Most of the advertising giant’s shareholders vote ahead of time, so the company knows the results in advance, although they are not announced until the day. Kleinman further tweeted, without citing sources, that up to 20 percent of shareholders also opposed the re-election of WPP chairman Roberto Quarta to the board.