Former WPP exec files $100 million lawsuit over alleged kickbacks, improper rebates

New Delhi: WPP said it will “defend vigorously” a lawsuit filed by former senior executive Richard Foster, who is seeking more than $100 million in damages and alleges he was terminated after flagging an improper rebate and kickback scheme within the group’s media operation. The company said the claims are without merit.

According to global news reports, Foster, who spent 17 years at WPP’s media arm and served as global CEO of Motion Content Group, the WPP unit that co-finances and produces TV programming such as Love Island, alleges the group’s trading teams struck volume-based rebate deals with media owners and did not always disclose or pass them on to clients, creating a hidden profit centre. 

The complaint says he was fired after repeatedly raising concerns with senior leadership. The lawsuit was filed in New York State Supreme Court. 

According to the filing, Foster alleges GroupM (rebranded this year as WPP Media) leveraged client spend to secure cash rebates or discounted inventory and, in some cases, retained a portion rather than returning value to advertisers. 

Receiving media rebates is not illegal in a lot of countries, but the practice can pose contractual and disclosure risks if not transparent, the report noted. 

WPP, in a statement cited by Business Insider, said, "The Company is aware of a lawsuit in the New York State Court filed by a former employee who was let go in a recent organizational restructuring," said a WPP spokesperson in a statement. "The court has not yet made any findings in relation to the allegations and we will defend them vigorously."

The suit revives a long-running industry flashpoint around media rebates and principal buying. Foster’s complaint argues that non-product income, including rebates and purchase-risk deals, has become material to agency economics and that governance has not kept pace.

WPP has not detailed its legal response beyond calling the suit meritless. The court has yet to make any findings.

Principal-based trading involves agencies purchasing media inventory upfront and reselling it to clients at a markup. This practice is especially common within large media agency networks and platforms. 

Critics argue the model inflates costs and distorts competition; defenders say fee pressure forced agencies to adopt it, placing the onus on clearer contracts, audit rights and disclosure of when inventory is being sold as principal rather than agent.