Fuse8 and Agency Called England legal battle
As first reported by The Drum in August, a clash over staff fidelity between two Leeds agencies, An Agency Called England and Fuse8, was severe enough to see the two almost lock horns in court.
Now both parties say that the matter has been settled, but discussing the case and its outcome, the two agencies remain anything but agreed.
The case surrounded three members of England staff, client services director Nigel Hunter, media director Stephen Dixon and account manager Zoe Ward, who all made the cross-city switch to join Fuse8 last year. With their departures came the suggestion that, legitimately or otherwise, some clients were then also open to persuasion to follow them across town with their business too.
At this point, An Agency Called England voiced its grievance. A statement from England said its case centred on breaches of fidelity by the three staff members while still in the employ of the agency, as well as breaches of employment contracts relating to confidential information and post-termination restrictions.
Fuse8, Hunter, Ward and Dixon have always denied these allegations and continue to do so. Alas, with both agencies deadlocked the matter was destined for a five-day November court hearing.
Conflicting arguments and smatterings of legalese abound from both parties as to exactly what happened next. An Agency Called England declared victory, announcing that Fuse8 had been ordered to pay “significant” costs and damages.
A carefully tendered legal statement from Fuse8 proffered though that the agency had not been ordered to pay any costs or damages, no accusations had been upheld and England’s claims had never been proven.
The reality, according to Fuse8, was that a figure was reached in settlement of England’s claim. This, Fuse8’s legal representatives say, represented an “acceptable” amount to pay to end the legal proceedings.
The complexity of the case and its outcome means that the issue of staff fidelity remains a grey area in what has become an incestuous industry - staff turnover averages 20 to 23 percent across the marketing and creative sectors, according to Aquent.
Nick Ramshaw, regional president of the Design Business Association (DBA), says he was surprised that the agencies’ disagreement reached as far as the courts, but can understand why England and Fuse8 were so keen to defend their reputations.
“In this instance, I can understand that if England feel aggrieved they have to see it through. It couldn’t be settled any other way so it had to reach the courts,” Ramshaw says.
While he admits there will always be “differences of opinion in business,” Ramshaw believes disagreements over staff loyalty have become increasingly rare because of the changing pace of the industry in recent times.
“Eight or ten years ago this kind of fall-out was much more likely because the rate of start-ups then was colossal. It’s a surprise now because most businesses in this industry are so well-run that the pace of departures, in senior roles, has slowed down.”
That said, Ramshaw admits, “a certain legal framework has to be in place to ensure you’re set up to handle any departures.” This has become de rigour for most in the industry, he says, with post-termination restrictions and succession plans offering most businesses sufficient security.
It is no surprise the case never went before a judge. The vast majority of such cases settle before going to court - as both sides realise the potentialy ruinous costs involved.
In this instance nobody appears particularly happy with the outcome. England has failed to have its day in court. Fuse 8 has been forced to make a payment to get the matter to go away. And no outright winner has emerged – except perhaps the lawyers themselves.
But the bottom line is that, no matter the merits of a case, getting embroiled in legal action is always a high risk venture.
“It is certainly something that is best avoided,” says Ramshaw.