He may have lost the first round, and the company he’s targeting may be struggling, but ad king Martin Sorrell isn’t giving up in his legal vendetta against digital-ad firm Spot Runner.
Sorrell’s WPP Group has vowed to pursue its claim that Spot Runner is a pump-and-dump scheme even though a federal judge tossed out the ad giant’s complaint.
A federal judge in California granted Spot Runner’s motion to dismiss the suit earlier this month but gave WPP permission to file an amended claim no later than Oct. 12.
“We intend to take full advantage of this opportunity to re-plead,” WPP said in a statement, adding that it was “disappointed” with the decision and continues to “believe strongly” in the case.
WPP, which owns 3 percent of Spot Runner, sued the company in April, claiming the two founders and other investors surreptitiously sold $54 million in stock without revealing the sales to other shareholders. The suit goes on to accuse Spot Runner’s co-founders of cashing out while the firm lost money and failed to build a sustainable business.
Spot Runner generated just $9 million in revenue last year after losing $45 million, according to the suit.
Among those named in the lawsuit are Spot Runner CEO and co-founder Nick Grouf and co-founder David Waxman, venture capital investors Battery Ventures and Index Ventures and Spot Runner board members including former AOL exec Robert Pittman.
In 2006, WPP invested $10 million in Spot Runner, a Silicon Valley startup that promised to upend the ad business by making TV spots affordable for smaller advertisers. WPP bought an additional $1.7 million of stock through a subsequent share offering in 2007.
WPP said it wouldn’t have bought more shares had it known the founders and other investors had been dumping their stock. The suit claims Spot Runner’s general counsel, Peter Huie, misled WPP when he wrote in an e-mail: “This offering does not involve the sale of any existing shares.”
The judge found that WPP misunderstood Huie’s e-mail, however. Huie didn’t say the shareholders weren’t selling; he only said they weren’t selling their shares as part of the offering.
“We are very pleased with the court’s decision to dismiss the case and we look forward to putting this matter behind us,” Spot Runner said in a statement. “Our primary focus is continuing the strong progress we are making on the Malibu Media Platform.” holly.sanders@nypost.com