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Why the Firing of Weird Design Guru Peter Arnell Was a Long Time Coming

By Jim Edwards

Updated on: February 12, 2011 / 5:30 PM EST / MoneyWatch

Peter Arnell's lawsuit against Omnicom (OMC) -- in which he claims the holding company kept his personal property after firing him on Feb. 2 from Arnell Group, the ad agency he founded -- raises an interesting question for CEOs with idiosyncratically decorated offices: Is that stuff yours or the company's?

Read the lawsuit here.

I've been inside Arnell's office. Back in the 1990s, he made visitors wait for him in a plush downtown Manhattan space filled with Star Wars memorabilia, movie souvenirs, toy soldiers, model spaceships and vintage eyeglasses. I was given a good long time to survey just how much cool stuff Arnell had accumulated in his career, before he entered and ushered me into a different room where our interview would actually take place. As Arnell weighed about 300 pounds at the time, it was rather like waiting in Jabba the Hutt's Tatooine lair.

At the time, Arnell owned Arnell Group outright. The company was his, and therefore the stuff was too. But Omnicom bought Arnell in 2001. Assuming Arnell used his company's money to buy his stuff, Omnicom acquired the pop-culture collection, also. According to Adweek's account of the lawsuit, the fact that Omnicom now appears to own the library and bric-a-brac Arnell spent his life collecting only dawned on him recently.

The ejection of Arnell has been a long time coming. In recent years, Arnell has become better known for promoting himself than for anything he's done for his clients. Here's a reverse chronology of controversies that Arnell has spawned:

May 2010: Arnell publishes Shift, a brand lifestyle manual that claimed you should "never have to blame yourself" for things going wrong in your career. Omnicom might have taken the position that Arnell should have spent more time with his clients than writing books.
Early 2010: Chrysler axes the Peapod, an "electric car" -- more of a golf cart, really -- designed by Arnell that wasn't road safe and couldn't exceed 25 mph.
Spring 2010: In pre-publicity for Shift, Arnell reveals that his habit of eating up to 50 oranges a day has left his hands bright orange in color.
February 2010: Arnell took a trip to Thailand with Martha Stewart -- he's an occasional guest on her show, which must baffle her TV audience -- and pitched the Thai government tourism business. "I think I can make this place famous for what it's famous for, instead of what we think it's famous for," was his line. Arnell Group does not currently list Thailand as a client.
April 2009: Arnell is ordered to return $100,000 of a $550,000 advance for Shift after failing to deliver it to his publisher despite the help of two ghostwriters, a personal assistant, his wife and an editor at HarperCollins.
March 2009: Arnell is humiliated in a Newsweek profile that portrays him as an insecure egomaniac who namedrops Jay Leno. In the same piece, he is quoted calling his own work for client PepsiCo (PEP) "bullshit."
February 2009: Tropicana reverses a relaunch of its iconic orange juice boxes, costing Pepsico millions, after a consumer backlash against Arnell's tepid, soulless package redesign.
February 2009: Arnell sold Pepsi a pretentious, mostly made-up brand ideology document linking Pepsi to the Mona Lisa, Decartes and Hinduism, as part of a successful logo redesign. Price: $1 million, reportedly.
May 2007: Gawker crowns Arnell one of New York's worst bosses, "a crude bully, a terrible coward and famously insincere." It alleged "he made one assistant lean over while he played her behind like bongo drums."

As for the art, Arnell may be screwed. A similar situation arose at MDC Partners (MDCA) recently. When CEO Miles Nadal's company went public, the new company became the owner of his art collection. In 2009, he paid $300,000 to buy it back from MDC. "Paying twice sucks," Nadal told me.

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