Adamson claims first blood in consultancy war

By Peter Chapman

Date: 11/12/03

THE Brussels consultancy and legal business is gripped by a courtroom drama which could have significant ramifications for the multi-million-euro lobbying industry in the Belgian capital.

Paul Adamson, one of the biggest and slickest operators in the game, is claiming victory in the first round of the legal battle with his furious former partner, who alleges Adamson breached his contract when he set up a rival company and poached key staff.

But his ex-colleague John Russell, chief executive of Weber Shandwick, the company Adamson left, insists the battle of the consultants has only just begun.

Adamson's lawyer, Charles Price, told European Voice that the Brussels labour court had dismissed an injunction to prevent Adamson from competing head-on with Weber Shandwick in his new venture, The Centre, and from soliciting former clients and staff.

Price, a Brussels-based partner at DLA, said the court vice-president had ruled there was no proof that Adamson had been guilty of 'unfair competition' by breaching clauses in his contracts with his former firm.

Crucially, she declared that a non-compete clause, preventing Adamson from setting up a rival to Weber Shandwick for 12 months, was invalid.

That is because Belgian law states that contracts must include the payment of an indemnity equivalent to 50% of salary for a non-compete clause to be legal. Such an indemnity was not foreseen in Adamson's contract, Price said.

Furthermore, the labour court said there was at this stage no prima-facie evidence to say Adamson had erred by soliciting former clients. This issue is less clear cut, but Price claims he has the necessary legal ammunition to counter further action on this point.

Meanwhile, on the staff issue, Price says the court found no evidence that The Centre had poached from Weber Shandwick. Under Belgian law, employees are allowed to switch jobs provided they give notice, he said.

The question of whether two of The Centre's other directors, Peter Verhille and Martin Porter - both ex-Weber Shandwick stars - had breached their employment contracts was not raised at this stage.

Price insisted Russell's legal team would find it difficult to make a subsequent case against Verhille and Porter stick - even though the pair also have non-compete clauses in their old contracts.

That is because their contracts state that they were employed to provide "management services to the company" and not public affairs expertise. This was designed to avoid expensive Belgian social security charges.

The non-compete clauses would thus only prevent Verhille and Porter offering management services - and not what they actually do.

Welsh-born Adamson became a millionaire in 1998 after selling his original company to BSMG; the BSMG/Adamson brand was then swallowed by Weber Shandwick Worldwide in 2001. The global consultancy's Brussels business was renamed Weber Shandwick Adamson, and Adamson served as chairman with John Russell as CEO.

A defiant John Russell this week shrugged off the court setback and insisted that the legal action is far from over.

"If that is what you have been told, they have led you very far down the garden path," Russell told this paper.

First, he said last week's ruling was just a preliminary decision, and that the labour court had said it would need a more in-depth hearing to reach a definitive verdict. Moreover, he said his lawyers were pursuing a number of potential avenues, including action in the Brussels commercial or general courts.

The former Australian army officer said the issue was a matter of "good corporate governance", and that dropping the action would send the wrong signal by suggesting that that it is fine to "betray" your former colleagues.

Paul Adamson, a former partner in Brussels lobby firm Weber Shandwick is in a legal battle with his former partner, who has accused Mr Adamson of breach of contract.