Interpublic Group of Cos., the second-largest U.S. advertising company, won dismissal of a suit by a former executive demanding $381 million for his alleged role in company’s gains from the sale of Facebook Inc. (FB) stock.
New York state Supreme Court Justice Eileen Bransten threw out the suit in a ruling dated Aug. 2 and made public yesterday, saying any oral contract between the executive, Ray Volpe, and Interpublic granting him profits over the sale of the Facebook investment was superseded by Volpe’s final employment agreement.
Volpe, who served as first commissioner of the LPGA women’s professional golf tour from 1975 to 1982, accused Interpublic in a suit filed in July 2012 of refusing to compensate him even though he had “sourced and procured” the Facebook investment.
Volpe claimed that he brought Interpublic the opportunity to invest and form a strategic alliance with Facebook in early 2006. The advertising company invested $2.5 million in Facebook in June 2006, taking a stake of about 0.5 percent in the company’s capital stock on a fully diluted basis, according to the suit.
Interpublic sold half of its stake on the secondary market for $133.5 million in August 2011 then sold its remaining shares for about $249 million in connection with Facebook’s initial public offering in May, according to the suit.
Neal Brickman, an attorney representing Volpe, didn’t immediately return a telephone message left at his office seeking comment on the ruling.
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