(Oct 30) HE set up the public relations firm 25 years ago.

And in its heyday, Michael de Kretser Consultants (MDK) counted big-name companies among its customers.

They included British furniture retailer Courts, computer giant Apple Inc, toy maker Mattel, courier firm Federal Express and fitness chain California Fitness.

The business grew and MDK opened offices in Malaysia and Thailand.

MDK even teamed up with advertising giant Batey, which came up with the Singapore Girl brand for Singapore Airlines.

Batey then took a 66 per cent stake in MDK.

Mr de Kretser, an Australian, left MDK to set up another PR firm in March last year.

Now, MDK is suing him for allegedly poaching its staff and clients.

MDK is now a shell company, having been wound up by the Batey Group, its major shareholder, in September last year.

RIVAL FIRM?

MDK claims that Mr de Kretser and its ex-CEO, Briton Michael William Rose, had breached their employment contracts and fiduciary duties by conspiring to set up a rival firm, DPR.

Both men are accused of poaching MDK's clients and staff for DPR.

MDK suffered damage, loss and injury because of the two men's actions from late 2005 to early 2006, its lawyer said.

No amount of damages has been sought by MDK, which is asking the High Court to assess compensation if it wins.

Mr de Kretser said in his defence that MDK had wrongfully removed him as its CEO in March last year.

He also alleged that MDK was wound up not because it failed to repay a $100,000 loan to Batey, but because of disputes over his severance package.

HIS LIVELIHOOD

Acting for Mr Rose, Mr Ling Tien Wah of Rodyk & Davidson said his client is a senior individual in the PR industry pursuing his livelihood after he was forced by circumstances to leave MDK.

'The defendants certainly did not set out specifically to compete with or injure MDK,' he said.

Relations between MDK and the Batey Group soured in 2003 after the British-based WPP Group took a controlling stake in Batey.

Mr Ling said that before Mr Rose left MDK in March last year, there were rumours that the company would merge with Burson-Marsteller, a WPP company.

The rumours turned out to be unfounded, as MDK was liquidated.

Yesterday, when the trial began, it was revealed that several clients went to DPR when MDK staffer Adrian Heng joined the former.

The clients - integrated circuits supplier AMD and Internet tools maker SMC Networks - had been serviced by Mr Heng.

The first to testify was Ms Goh Sue Lynn, an ex-MDK employee who now works for Text 100, another PR firm.

She recalled how her colleagues were worried when the rumours started in September 2005. That was around the time Ms Goh joined MDK.

She also believed that AMD and SMC Networks, two of MDK's clients then, switched to DPR as Mr Heng had told them about the instability in MDK.

She added: 'As early as December 2005, I knew from Adrian Heng that Mr de Kretser and Mr Rose were going to set up another firm to compete with MDK.'

As such, Mr Rose's resignation from MDK in March last year was not surprising.