Business

Class action suit filed against Miami ad agency that laid off 62 workers

An employee laid off from a Miami advertising agency with no warning earlier this month has filed a class-action lawsuit against his former company, which is owned by the private-equity firm of a major donor to Ted Cruz.

Jorge Espinosa, who worked at national advertising agency Commonground/MGS, said he and 61 other Miami employees were entitled by law to at least 60 days notice of their termination. He is seeking wages, insurance coverage, commissions and other benefits for those 60 days. The case was filed last week in federal court in Miami.

Commonground suddenly shuttered its offices in Miami, New York, Chicago and other cities on Dec. 5, a Saturday, telling its employees they had to clean out their desks by Monday.

The company’s management informed employees that a dispute with lender Fifth Third Bank of Cincinnati meant the business had to shut down.

“It is therefore with deep regret and heavy heart that we have to inform you that without access to funds, we are no longer able to operate our business,” the company told workers in an email that was included as evidence in the case. “Your employment will therefore terminate effective today, December 5, 2015. While the Worker Adjustment and Retraining Act of 1988 may require advance notice of your permanent layoff, the unforeseeable circumstances of the lender’s actions and our faltering business circumstances that necessitated our good faith efforts to actively secure capital to prevent closing the Agency, did not afford us an opportunity to provide such advance notice.”

Brian Chaiken and D. Porpoise Evans of Miami law firm Perlman Bajandas are representing Espinosa.

Commonground, a minority-owned firm, was a merger of several regional ad agencies including local shop MGSCOMM. The deal was engineered by Atlanta-based private equity firm Panton Equity Partners through its affiliate PCH Communications.

David Panton, the firm’s chairman and CEO, is a major donor to Republican presidential candidate Ted Cruz, having contributed $100,000 to a Super PAC backing the senator from Texas, federal records show. The two were reportedly partners on the debate team and roommates at Princeton University. Panton, who has also donated to Rep. Mario Diaz-Balart, R-Miami, did not respond to a request for comment.

Update: An earlier version of this story incorrectly identified the location of Commonground’s South Florida office. It is in Miami.

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