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CORRESP
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            June 14, 2005

Larry Spirgel

Assistant Director

Mail Stop 0407

Division of Corporation Finance

Securities and Exchange Commission

450 Fifth Street, N.W.

Washington, D.C.  20549

            Re:

            MDC Partners Inc.

Form 10-K for Fiscal Year Ended December 31, 2004 (the "2004 Form 10-K")

Filed April 18, 2005

Form 10-Q for Fiscal Quarter Ended March 31, 2005 (the "March 31 Form 10-Q")

File No. 1-13178

Dear Mr. Spirgel:

Set forth below are the responses of MDC Partners Inc. (the "Company") to the comments of the Staff of the Division of Corporation Finance, which were set forth in your letter dated May 31, 2005 (the "May 31 Letter") regarding the Company's above-referenced filings.  The responses to the Staff's comments are provided in the order in which the comments were set out in the May 31 Letter and are numbered correspondingly.

The Staff's comments, indicated by bold, are followed by responses on behalf of the Company.  Page references below are to the applicable Exchange Act filing, as the case may be.

Form 10-K for Fiscal Year Ended December 31, 2004

Item 7.  Management's Discussion and Analysis of Financial Condition and Results of

Operations, page 26

Presentation of "Combined" Revenue, Operating Costs and Operating Profits, page 26

            1.

            We note your presentation of "combined" results of operations within the marketing communications segment.  Tell us why you believe these measures are appropriate under the guidance in Item 10 of Regulation S-K.  In addition, please balance this discussion with an equally prominent and comparably detailed discussion of the marketing communications segment results on a US GAAP basis.

Mr. Larry Spirgel

Securities and Exchange Commission

June 14, 2005

Page 2 of 25

Item 10(e)(i)(C) requires that the registrant provide a statement disclosing why management believes that the non-GAAP financial measure provides useful information about the registrant's financial condition and results of operations.  Management has provided this information on pages 26-27 of the 2004 Form 10-K.

In preparing the Company's MD&A for the year ended December 31, 2004 and March 31, 2005, the Company presented combined operating results as the Company believes that it provides additional useful information to investors regarding its financial condition and results of operations.  The following are the main reasons why the Company believes the information to be useful:

•        The Company operates as a holding company, owning various ownership interests in similar entities.  The Company both manages and monitors the businesses similarly, regardless of the ownership interest. The Company believes that it is important for investors to see how management monitors the results of the Marketing Communications segment including how it evaluates certain key performance indicators (e.g., revenue growth and operating expenses as a percentage of revenue) on a comparable basis across the Marketing Communications segment.

•        A significant portion of the Company's revenues and profit is generated by a 49% owned subsidiary, Crispin Porter + Bogusky, which was historically accounted for on the equity basis, but since September 22, 2004 has been consolidated in accordance with FIN 46R.  By presenting the results on a combined basis, the periods are more comparable.

In future filings, the Company will enhance the description of why it believes the combined information is useful to investors and users of the financial statements.

Item 10(e)(i)(A) requires that the registrant provide a presentation, with equal or greater prominence, of the most directly comparable financial measure or measures calculated and presented in accordance with GAAP.  In preparing the MD&A, the Company intended to provide an analysis on a combined basis to illustrate trends in the underlying performance of all of the entities in which the Company has an equity interest.  The trend information was not separately disclosed in the GAAP section of the MD&A as the trends set out in the combined section were not inconsistent with the GAAP analysis.  The Company made the reader aware of this fact on page 36 of the Form 10-K, which states that "As previously discussed, the increase related primarily to acquisitions (excluding those accounted for on an equity basis) in the Marketing Communications Group,..."  The following
sample illustrates how the GAAP trends were not inconsistent with the combined trends presented in the MD&A: revenues by geographic region remained the largest component for the U.S. region at 78% on a combined basis, compared to 68% on a GAAP basis.  Revenues from advertising services also remained the highest component of the Marketing Communications Group, with revenues on a combined basis equal to 45%, compared to revenues on a GAAP basis equal to 39%; and operating profit on a combined basis would have grown 41%, compared to 46% on a GAAP basis. Accordingly, the Company did not believe that it was necessary to repeat the detailed disclosure of the reasons underlying the changes in the Marketing Communications division for the GAAP financial data, as we believe it did not provide any additional value to the MD&A. The Company believes that the disclosures made on a GAAP basis meet all the required disclosures of Item 303.

Mr. Larry Spirgel

Securities and Exchange Commission

June 14, 2005

Page 3 of 25

For the reasons described above, the Company believes it has provided balanced disclosure regarding the Marketing Communications segment on a GAAP basis, and the disclosure that is presented for combined information is incremental to the required GAAP presentation.  The Company further believes that the information provided is not misleading to the users of the financial statements. The Company has noted the Staff's concern over equal prominence and will commit to enhancing the disclosure of the GAAP numbers on a prospective basis.

Note 2 – Significant Accounting Policies, page 66

Goodwill and Indefinite Lived Intangibles, page 68

            2.

            Tell us how you have identified your reporting units under SFAS 142 for purposes of testing goodwill for impairment.

                The Company has identified its reporting units under SFAS 142, for purposes of testing goodwill for impairment, to be its operating segments. In accordance with SFAF 142 paragraph 30: "A reporting unit is an operating segment or one level below an operating segment (referred to as a component)".  A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results of that component.  However, two or more components of an operating segment shall be aggregated and deemed a single reporting unit if the components have similar economic characteristics. Paragraph 17 of SFAS 131 provides guidance on aggregation and the definition of similar
economic characteristics. Management has concluded that under this guidance the components under the Marketing Communications operating segment (which as of December 31, 2004 represented all the recorded goodwill) have similar economic characteristics and similar long-term quantitative economic characteristics.  For additional information on aggregation, see our response to Staff question 7.

In addition, as part of the Company's annual testing of goodwill, the Company also prepared an analysis of goodwill impairment on a legal entity level basis, which confirmed its conclusion that there was no goodwill impairment for the fiscal year ended December 31, 2004.

Note 7 – Investments in Affiliates, page 80

            3.

      Tell us how you determined that you were not required to present separate financial statements under Rule 3-09 of Regulation S-X or summarized financial information under Rule 4-08 of Regulation S-X for any of your investments in affiliates, which are accounted for using the equity method.

Mr. Larry Spirgel

Securities and Exchange Commission

June 14, 2005

Page 4 of 25

Rule 3-09 of Regulation S-X

Pursuant to Regulation S-X, Rule 3-09 and Rule 1.02(w), as at December 31, 2004, the Company's' most recently completed fiscal year, the Company's consolidated total assets were $437,855,000 and its consolidated income from continuing operations, before income taxes, extraordinary items and cumulative change in accounting principles (as computed based on the "computational notes" due to a 10% lower level of earnings and due to a loss year) was $26,652,000.  None of the Company's investments in subsidiaries not consolidated accounted for on the equity basis as at December 31, 2004 exceeded the 20% thresholds as determined pursuant to Rule 1-02(w) tests 1 and 3.   The largest equity accounted for investment only accounted for 1% of our consolidated total assets and 1.8% of our adjusted consolidated income from continued operations.

Rule 4-08 of Regulation S-X

Pursuant to Rule 4-08(g), although the Company is not required to provide summarized financial information for its investments accounted for under the equity method at December 31, 2004 as it did not meet the criteria in Rule 1-02(w) for a significant subsidiary per 4-08(g)(1)(ii), the Company did provide the summarized financial data for investments accounted for under the equity method as required by APB 18(20).  The aggregated equity accounted for investments only accounted for 2.5% of the Company's consolidated total assets, and 4.1% of our adjusted consolidated income from continued operations.

Note 9 – Variable Interest Entities, page 81

            4.

            Describe for us in more detail your accounting for your investment in Crispin Porter + Bogusky, LLC (CPB) by clarifying the following items:

        •

        How you determined that CPB is a variable interest entity under FIN 46R.

            •

            How you determined that you were not the primary beneficiary prior to September 22, 2004.

            •

            The nature of the events that occurred on September 22, 2004 and earlier in the third quarter that caused you to change your method of accounting for this investment.

            •

            How you determined that you are the primary beneficiary of CPB after September 22, 2004.

                The Company reviewed its accounting for CPB under paragraph 29 of FIN 46R as a result of a triggering event on September 22, 2004, and determined that it met the conditions of FIN 46R paragraph 5(c) effective from September 22, 2004. Prior to September 22, 2004, the Company determined that its investment in CPB did not qualify as a VIE as it did not meet the criteria of paragraph 5 (c). The following provides a summary of our determinations.

Mr. Larry Spirgel

Securities and Exchange Commission

June 14, 2005

Page 5 of 25

(a)              Paragraph 5(a) considerations:There are no other variable interest holders in CPB other than Maxxcom (a wholly owned subsidiary of the Company) and the Founders

            The ownership of CPB membership interests is as follows:

            Member

            % Ownership

            Maxxcom

            49%

            Crispin & Porter Acquisition Inc ("CPB/ S-Corp")

            50%

            Founder 1

            0.36%

            Founder 2

            0.27%

            Founder 3

            0.27%

            Founder 4

            0.10%

            Total

            100%

            The ownership of CPB /S-Corp is as follows:

      Member

    Percentage ownership

    Founder 1
    40.907%

    Founder 2
     30.641%

      Founder 3

      19.297%

      Founder 4

      9.155%

      Total

      100%

The only debt outstanding is the loan payable to the Company on account of the leasehold improvement.  On June 25, 2003, Maxxcom advanced $2 million to CPB under a Promissory Note and Security Agreement to enable CPB to acquire leasehold improvements. Neither Maxxcom's nor the Founder's equity investment at risk is excluded from equity investment at risk as it represents all of the investment in membership interests, there are no guaranteed returns, and none of the investments are redeemable by CPB and thereby not excluded from equity under FAS 150.

Maxxcom has a call option to purchase additional interests in CPB and the S-Corp/Founders have a put option to sell their interest in CPB to Maxxcom.  The exercise prices for 34% of both the put and call options are variable and are intended to represent an estimate of future fair value, while the remaining 17% call option is a fixed price call.  The Company has concluded that the 51% interest subject to the puts and calls should be considered in the aggregate as the Founders interest is not divisible.  The 17% fixed price call option is not

Mr. Larry Spirgel

Securities and Exchange Commission

June 14, 2005

Page 6 of 25

a specific subset of the 51% interest, but rather the investment needs to be considered as a whole.  The Company has concluded that the presence of variable priced put and call options do not result in the equity of the Founders being excluded from equity at risk under paragraph 5(a) as the equity instruments would participate significantly in the profits and losses of the entity.  Aggregating the fixed put/call with the variable put/call would still allow the holders to participate significantly in the profits and losses.

In applying paragraph 9, the Company has looked at the facts and circumstances that gave rise to the loan.  CPB's historical operating results have been strong.  The loan for the leasehold improvements could be paid out at any time by CPB purely by not paying out the monthly profit distributions (which is specifically provided for in the operating agreement).  CPB could have paid for the leaseholds on its own based on its cash flows from operations, without any borrowings or CPB would have had no difficulty obtaining third party/bank borrowings to pay for the leaseholds.  At the time of the Company's assessment management concluded that the equity at risk in CPB was significant. Subsequent to the Company's determination at September 22, 2004, a fair value assessment was prepared by an external valuator that confirms the significance of the equity at risk as the fair value
of CPB was estimated to be $84.5 million.  Due to the large profits CPB earns, and amount of the leasehold financing relative to the fair value of the equity at risk and a qualitative assessment of the expected losses, we have concluded that the equity at risk is currently sufficient and 5(a) is not met.

            (b)

            Paragraph 5(b) considerations:

There are no other variable interest holders in CPB other than Maxxcom and the S-Corp/Founders as at January 1, 2004 and September 22, 2004, and all of the equity of both Maxxcom and the Founders is included in equity at risk (as noted above under the paragraph 5(a) discussion).  On a combined basis, Maxxcom and the Founders own all of the membership interests of CPB.  Accordingly, paragraph 5(b) is not met.

            (c)

            Paragraph 5(c) considerations:

            (i)

            Disproportionality of voting interests and sharing of profits and losses - (5(c)(i)):

                MDC owns 49% of the membership interests of CPB and the Founders individually or through S-Corp. own the remaining 51% of the membership interests.  We have determined that the voting rights of the investors are not proportionate to their obligations to absorb the expected losses of the entity and their rights to receive the expected residual returns as Maxxcom receives more of the share of the earnings under the terms of the amended contract of June 2003. Under the terms of that amendment, the parties agreed that for the period between 2003 and 2007, for any pre-tax profit