Reason #1

Everyone knows that today’s society is litigious.  Anyone can sue, for any real or imagined slight.  The lawsuits listed below are actual examples of frivolous suits wasting the court’s time.

– a man sued Budweiser for false advertising by depicting “beautiful women and men engaged in endless and unrestricted merriment.” This one was dismissed.

– a man sued his wife for being ugly after the birth of a none-too-handsome baby and won after she admitted to having plastic surgery prior to meeting her husband.  He was awarded $120,000.

– as for that HOT warning on your coffee, thank Stella Liebeck for that.  She sued McDonalds after suffering third degree burns when she spilled her coffee on her lap while driving.  The jury awarded her $2.7 million.  She later settled with McDonalds for an undisclosed amount.

– Alan Heckard, an alleged Michael Jordan look alike, sued Jordan and Nike for $416 million for the emotional pain and suffering endured during comparisons to the incomparable MJ.  Nike, in his opinion, was equally culpable for having made Jordan a recognizable celebrity.  Heckard dropped the suit.

– Carl Truman won $74,000 after his neighbor ran over his hand with a Honda Accord.  Truman was stealing the neighbor’s hubcaps at the time.

– Terence Dickson was awarded $500,000 for anguish endured while trapped in a garage for eight days after an automatic garage door malfunctioned.   Dickson had just burglarized the home.  Apparently, he wasn’t a very good burglar and couldn’t break back into the house.

The world, or at least the U.S., loves to sue.  Companies hate being sued.  They hate it so much they sometimes settle even when they’re in the right, just to make the lawsuit go away.  Again, it comes down to cost/benefit analysis.  If it’s cheaper to settle, then settle.  Even better than settling is not getting sued in the first place.  The best way to limit potential lawsuits is to get the attorneys involved.  Early.  They are professional risk mitigators.

In my former job, I always invited the attorneys to join the design phase.  I also coached my teams on the correct way to involve them.  Never,ever, I would tell them, ask the attorneys what to do.  Taken to the extreme, their advice would have been to never write a single policy (I was in insurance).  After all, that’s the best way to limit exposure.  Instead, I directed my teams to tell the attorneys what we’re doing, ask what exposures exist in that intended course of action, and finally ask for suggestions on how to best mitigate those risks.

So, why the rant about attorneys and lawsuits?  It boils down to the first reason why:  the lawyers made ’em do it (aka to avoid getting sued)

Here’s an example.  The company I worked for spun off another company.  To celebrate, I gave everyone in my department a flash drive with the spin-off name emblazoned on the side.  Word got out.  The sales reps liked these flash drives so much, they starting giving them away to independent insurance agents (non-employees selling the company’s product to the public).  Then the tablets came down from the mountain and proclaimed that giving away flash drives was now against company policy.

The rationale was as follows:  If a sales rep gave a flash drive to an agent, and the agent put confidential information on the flash drive, and if the flash drive was then lost, and if the lost flash drive was then recovered by an unauthorized individual, and if said unauthorized individual then accessed the confidential data, and if that confidential data were then used for some nefarious purpose, it could come back to haunt the company.   If all that came to pass, the attorneys said, the company could be liable for damages.

I don’t know about you, but I think that statement had way too many ifs to take seriously.  To me, it sounds more like raving paranoia than anything resembling sensible caution.  But, the tablets were law and flash drives were 86’d off the menu.  WHY?  Because the company was afraid of getting sued.   That’s why McDonalds and every other fast food joint now uses sleeves to serve hot coffee.  That’s why the label on a Bic lighter contains warnings and instructions.  I mean seriously … who needs instructions to operate one of those?

Try it on for size.  Why do corporations have Human Resource departments?  Answer:  reason #1.  HR departments create oodles of process – hiring processes, firing processes, performance management processes, promotion processes … the list goes on, but you get the idea.  These processes exist to create a fairer, more objective workplace.  Employees and job candidates benefit from these processes.  Designed properly, they allow the cream to rise to the top.  But, corporations benefit from HR processes too.  Without them, they’d be sued left and right by sourpuss ex-employees and turned down candidates and the EEOC would need ten times the staff.

Till the next post, chris

<– The Three Reasons Why

Reason #2 –>

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