The agreement between Group M, WPP’s media-buying division, and Firm Decisions, the compliance arm of media auditing firm Ebiquity, means a trial that was scheduled to take place in London’s High Court later this year will no longer go ahead.
In a joint statement, Group M and Firm Decisions said: "Following the commencement of High Court proceedings in May 2016 by Group M and its agencies, the dispute between Firm Decisions and Group M has now been concluded. No further comment will be made by either party."
Firm Decisions has always maintained it had done nothing wrong.
It is one of a small number of specialist compliance businesses that are employed by advertisers to check whether media agencies have complied with the terms of their contracts.
Group M began its legal action last year after it emerged that a series of confidential documents had been sent by accident by Group M agencies to Firm Decisions.
In its legal claim, Group M said that Firm Decisions had given a "wholly inadequate" assurance that it had deleted all trace of the "four or five" different, confidential documents, which are thought to include details of clients’ media spend.
Group M claimed Firm Decisions may be "in breach" of its non-disclosure agreement between the two companies.
The court filing also quoted a "senior Firm Decisions employee" as saying the media auditor planned to keep a document "up our sleeve" to use at a later date.
Firm Decisions robustly denied any wrongdoing or misuse of information in its defence, insisting it told Group M's agencies at the time in each of the instances where confidential information was received in error and it also deleted the documents or returned them.
The auditor admitted a member of staff had discussed keeping a document "up our sleeve" but insisted no NDA was breached, "the relevant employees had been reprimanded", and a formal apology was made at the time to the Group M agency, MediaCom Australia.
"None of these incidents involved any breach or potential breach of the relevant NDAs by Firm Decisions," the defence filing said.
Group M and its agencies had been seeking costs and "reserve[d] the right" to seek damages "should evidence come to light which shows they have suffered a loss".
They also wanted an injunction to prevent Firm Decisions from "misusing" confidential information and for the company to give an assurance "on oath" that all electronic copies of the documents have been deleted
The legal row pitted WPP, the world’s biggest advertising group with a stock market value of £21bn, against Ebiquity, which is worth about £84m.
A source close to WPP said at the time the decision to sue had no connection to Ebiquity’s involvement in a recent investigation by the Association of National Advertisers into US media agencies.
The ANA criticised "numerous non-transparent business practices" such as rebates at US media agencies, without naming any companies, in a report, carried out by K2 Intelligence.