Steve Boyer

Despite research indicating the public views “no comment” as tantamount to “guilty,” many attorneys still see it as the most appropriate response to questions regarding pending or ongoing litigation. In fact, it is often the riskiest approach.

A search of recent Northwest news reports turns up numerous “no comment” examples. These are just a few:

• When a store was sued over a credit card issue, the spokesperson’s response was that store officials hadn’t seen the lawsuit and couldn’t comment.
• In response to a lawsuit over the alleged release of a customer’s name and contact information, a cellular telephone provider said it could not comment on pending litigation.
• A plumbing products manufacturer was required to pay damages to a homeowner over an alleged product malfunction. Asked whether any similar incidents had ever occurred, the company would not comment.

For all three companies, “no comment” may have been the least risky alternative from a legal perspective. However, it often carries the highest overall risk for a litigation target, especially a business. While the legal issue itself will be decided in court, what’s at stake in the court of public opinion may be the future of the business itself.

Survey: ‘No comment’ equals guilt

A 2002 national survey by Hill & Knowlton found that 62 percent of respondents viewed a company’s refusal to comment about a lawsuit as an attempt to cover up guilt. According to the global public relations firm’s survey, 51 percent would be more likely not to buy the company’s products unless it explained its position.

The effects of litigation can be more damaging -- sometimes much more -- than the actual legal penalties. A University of Washington study found that reputational damage constituted approximately 90 percent of the total penalty for companies involved in litigation on issues involving fraud, product recalls, false advertising and punitive damages, in which the public trust is undermined.

The impact is compounded by the court of public opinion’s rules of conduct, which are the opposite of the courtroom’s well-ordered world. Instead of weighing the evidence before rendering a verdict, public opinion renders its initial verdicts based largely on first impressions.

Further, the public presumes guilt and expects the accused to prove innocence. The Hill & Knowlton survey found that 88 percent of respondents said a company should explain its behavior in a high-stakes case.

Perhaps most significantly, if a company provides such a response, the public may provide it with the benefit of the doubt. A total of 81 percent of respondents said they would suspend judgment of a company if a clear, timely explanation were provided.

Based on the research findings, it’s likely that public opinion judged all three companies cited above as guilty based on their unwillingness to comment. Legal considerations may prevent an explanation from being as clear and complete as the public might want. However, similar reports frequently show up not only in news stories on national, high-profile litigation, but in Northwest lawsuits as well, potentially impacting attitudes and buying habits of local customers.

With the growth of business and litigation news coverage, it’s becoming easier for a company to find itself facing a lawsuit and reporters who want to know about it. Any company, local as well as national, and its attorney need to be prepared to comment when newsworthy litigation arises.

Principles of effective response

The guidelines for effective response are straightforward. What’s most fundamental is recognizing the strategic need to respond. That opens the way to move from “no comment” to messages that resonate in the public arena.

Plan ahead. Develop a response plan for litigation. This should include the company’s overall key messages about what it stands for. It should also include a process to quickly convene the company’s attorneys and top executives, including the one with communications responsibility, to determine strategy and a response. Public relations counsel also should be included.

Respond quickly. The first news story is the most important. Respond by the media’s deadlines or your comments will be buried in smaller, later stories if not completely ignored. Meanwhile, the first impressions will stay with the public.

Provide substance. The comment should reflect substance, either about the litigation issue itself or the company’s principles and key messages that relate most closely. It should communicate effectively with company stakeholders and the public without compromising the legal strategy.

When you can’t be specific, explain why. Then go to the company’s most applicable message. “We haven’t seen the lawsuit” doesn’t work by itself. Here’s an example of how to combine an explanation with a statement of the company’s values: “Our company is built on safety and quality. While we haven’t seen the lawsuit, we can say that we have succeeded because customers recognize and appreciate our safe, quality products.”

And of course, avoid “no comment.” For a business client operating in the court of public opinion, it’s often the riskiest response of all. n