GOLDMAN SACHS PART II

Posted in Crisis Communication Failures, Crisis Communication Strategy, Crisis Litigation, Legislative Advocacy, Liability Communications, Litigation Communications on April 29th, 2010 by admin

Being sued is one thing. Hopefully you can defend yourself. Proving your or your company’s innocence can be a full-time job. A good defense not only saves you money – damages, including punitive damages – it also saves your reputation. In fact, the costs of litigation, as high as they are, can, in part, be chalked up to the cost of good public relations. Guilty parties, however, pay the price.

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GOLDMAN SACHS PINSTRIPES TO PRISON STRIPES

Posted in Crisis Communication Failures, Crisis Communication Response, Crisis Litigation, Liability Communications, Litigation Communications on April 29th, 2010 by admin

I’m only kidding. I don’t think any of them will go to jail. They are smart. And they are wily. They did terrible things, low down and scurrilous, greedy, selfish, un-American, with the best interests of themselves at heart – but NOT ILLEGAL.

Years ago capitalism meant something. Something constructive and creative. Today the meaning has been reduced to “getting yours”, no matter what the cost is to others. Getting yours often means selling thin air, creating nothing and selling it for a premium. And that is what Wall Street often does. It creates “products” – financial products that create nothing. The products are nothing more than new casino games people can bet on. And Goldman created many, especially ones that let some of their clients bet against the U.S.A. Now Goldman says it gave its clients what they wanted. I doubt it. It’s hard to envision clients coming up with these schemes and asking Goldman to create the vehicles. Easier to envision is a group of Goldman players sitting around a conference table kicking ideas back and forth about what they think they can sell.

But, I digress. The point is that Goldman is in crisis mode. The players have been severely criticized for bobbing and weaving before the Senate and not being forthright and not admitting their culpability. But hold on. Individual members of the firm and the firm itself have been sued. This situation perfectly demonstrates the conflict that often arises between a company’s legal counsel and its PR people.

Wouldn’t it be nice and perhaps even productive if Goldman threw itself on the mercy of public opinion. We are a forgiving nation. We love it when someone or some thing is brought to its knees. We then go on to the next biggest thing on the national agenda. We have short memories. But what’s a company, individual or non-profit to do when litigation or administrative sanctions are staring them in the face. There are a few things: deny outright, regret the situation but make no admission, blame someone else, plead ignorance, admit some unintentional mistakes were made, etc. None of the options are particularly pleasing. Two were in plain sight at the Goldman hearings: outright denial that anything wrong was done, and secondly, admit fuzzily that some mistakes may have been made. But certainly no one wanted to get his you-know-what caught in the wringer, or be responsible for the downfall of his employer or former employer.

The moral of the story for crisis management is that, depending on the circumstances, one must be very careful. Legal advice that is tantamount to “No Comment” or “I can’t discuss this because it is in the courts” may at times have its place in crisis management. P.R. and marketing types are not always right and neither are the lawyers who are protecting a client’s interests. But there are often ways to take advantage of situations – to explain, to be contrite, to regret situations, all without admitting liability. It’s up to you, the individual client, to weigh the advise and find the intelligent path that both protects you and your company’s interests and at the same time deals constructively with the crisis and public perception.

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