Nightmare at W. R. Grace III - A new Disney film tells a sad tale of toxic spillage, contaminated water and child leukemia deaths Unfortunately for W.R. Grace, it's based on a 'true' story - one which the company settled in court 12 years ago. What does the PR boss do now? By Susan Fry Bovet.
When a court case comes back to haunt a company 12 years after settlement, it's the worst nightmare a corporate PR director can imagine. And that's what's happening - for the third time in four years - to WR Grace & Co.
On Christmas Day, the release of the new Disney drama A Civil Action will once again rub the $1.5 billion-dollar company's nose in a messy business involving toxic chemical spills and children dying of leukemia, allegedly caused by contaminated well water.
The book A Civil Action by Jonathan Harr, published in 1995, got the ball rolling to squash Grace's reputation, nine years after the company paid the plaintiffs $8 million to settle the case. And the paperback topped the New York Times bestseller list for 106 weeks.
Despite its protestations of innocence, Grace will once more be painted as the villain in Touchstone Pictures' movie with a reported $25 million promotion budget. Trailers for the film, which stars John Travolta, Robert Duvall, John Lithgow, William H. Macy, Bruce Norris and Kathleen Quinlan, are already bombarding the airwaves. It covers the issue of chemical spills charged to Grace and its co-defendant Beatrice Foods, now part of Conagra.
Travolta plays attorney Jan Schlichtmann, who represented families of leukemia victims, six of whom died. Already the entertainment press is talking about the movie star as an Oscar nominee.
'It's a lawyer story - pure Hollywood - with an ambulance-chasing attorney,' complains Grace's director of corporate communications Jane McGuinness.
The company had 'no direct contact' with Disney during filming, she says.
'We hope the movie won't interfere with the good actions Grace has taken in the past 10 years to clean up its act and become a model citizen in environmental protection.'
The company boldly established a web site in mid-November to counter some of the flak the film's pre-release publicity is likely to stir up.
Ironically, it went online before the film's web site was up and running.
Called 'Beyond a Civil Action - Woburn Issues & Answers,' the site 'presents new information and offers many important facts about the case, beyond what is portrayed in either the book or the movie,' says the home page.
Headings on the page link viewers to pages on Facts, The Environment, The Book, The Movie, Links, Search and Press Room. The press room page gives boilerplate information about the company and offers links to independent sources, such as the U.S. Environmental Protection Agency (EPA), research facilities, media reports and comments from Woburn residents.
KVO of Portland, OR, one of three Pinnacle Group PR firms Grace has consulted, helped prepare the site to extend the company's basic message, says McGuinness.
'If you look at 15 years of data, you see we were not at fault. More importantly, we as a company have acknowledged that we clearly made mistakes and that we have made changes in business practices, in cleaning up toxic waste and in community relations.' She also consulted with Levinson, Dallas, on entertainment issues and Agnew, Carter, McCarthy in Boston for media relations there.
Grace's regular corporate web site will soon be linked to the civil-action one, reports McGuinness. The corporate site also covers the company's positions, the history of the Woburn matter and Grace's 10-year cleanup and pro-environment initiatives.
The firm's PR team and top management have reviewed its communications positions in response to the upcoming film. They monitored film production and are monitoring pre-release media and Internet coverage. Grace has also developed informational tools to build proactive relationships with key publics: employees, media and others, McGuinness reports.
She and Mark Stoler, director of environmental health & safety and assistant general counsel, have been with the company since the toxic spill crisis started in Woburn, MA, in 1982. They talked about Grace's PR strategy and tactics last month in Boston at a session sponsored by the Public Relations Society of America's Environment Section at PRSA's national conference. Many PR pros in attendance commented on Grace's approach.
And while the company seems to be handling a lot of things right - some for the first time - there is still room for improvement, several sources noted.
What else is in Grace's PR gameplan? 'We'll try to minimize damage to the corporate reputation,' says McGuinness. 'We won't try to retry the case. That's history!' Because of Disney's deep pockets, Grace does not want to go head-to-head with the film maker. 'We don't want the film to become a cause celebre for accuracy in film. After all, it's Hollywood's interpretation.'
What will Grace do proactively when the movie comes out? Top management's primary concern is how its 6,300 employees in 40 countries will react when the film appears, she says. 'We have narrowed the key audience to employees.' Grace has organized a system of fast faxes to staff to alert them of the situation. Management representatives will speak to employees at all major U.S. plants, she told PRWeek just before press time. Staff around the world will also receive background information kits on Woburn and the issues raised in the film. 'Employees are being enlisted in Civil Action teams to monitor feedback and field questions from employees and the community,' she says.
Grace also plans to contact opinion leaders in government, business and community groups, especially in the Boston area. As for media, the communications plan calls for meetings with editorial boards in Boston and some national press, announcing: the new web site; press kits for Boston and trade media; contacts with entertainment, business and environmental reporters in the top 20 markets; and a videotaped prepared statement with Q&A.
'Grace has not fully anticipated the impact this movie will have,' says David A. Meeker, executive vice president of Edward Howard & Co. of Akron, OH. 'First, there's the movie, with previews of movies both written and on TV. Then it will be shown on HBO and pay-per-view. Then the video will be released. This isn't going to go away. Given the quality and notoriety of the actors, it could be the biggest movie of the year.' Meeker manages Edward Howard's environmental practice. He heard an abbreviated version of Grace's crisis plan at PRSA.
'If I were Grace, I would put a backgrounder kit in the hands of every movie critic, because that's where the story is going to get written first,' advises Meeker. The public might approach the situation differently if they were exposed to some of Grace's information in a review or preview of the film, he explains. 'Of course, the story transcends the critics - the nature of it is going to flow over into general media and the environmental press. So a broader media audience must be addressed.'
'What about stockholders? Are they being informed?' another PR pro at PRSA asked. 'How about customers and your vendors?'
'We're a business-to-business marketer with no direct customers,' replied McGuinness. 'We will not bring up the conflict with customers.' Grace's return on investment to shareholders was 200% from 1995 to 1997, the company reports. That performance put Grace above the 90th percentile of S&P industrial companies for the period. It remains to be seen whether the upcoming movie will affect shareholder values.
The question of an apology, a graceful gesture on Grace's part, was also raised at the PRSA session. Grace officials could have expressed condolences for the loss to the victims' families, they said. 'There's a responsibility to do what's right, whatever that is,' said one listener. Like Iacocca with Chrysler, another observed, 'there's a time to apologize and not equivocate about the strength of the allegations.'
Schlichtmann 'never asked for an apology,' according to Stoler. 'He asked for money. If we don't think Grace did it, what are we apologizing for?' he asks. In fact, Grace has taken lots of steps to make amends in Woburn.
But no one seems to know its side of the story. New technical evidence from an Ohio State University professor seems to vindicate Grace, Stoler reports.
'We didn't do it' is Grace's key message when it comes to polluting the wells in Woburn that caused children to die, states Stoler. He's worked on the Woburn case for 16 years and five months. Co-defendant Beatrice Foods, a company that was broken up in 1980s, may have been at fault.
Both Beatrice and Grace are mentioned in the upcoming film. In fact, Robert Duvall is playing Beatrice's cut-throat attorney.
'Grace is not telling the story to enough of its key constituencies,' says Craig Miyamoto, principal & senior counsel at Miyamoto Strategic Counsel in Honolulu. Grace is ignoring audiences who could significantly affect their business, in his view: shareholders, suppliers, customers, legislative and regulatory people. 'If you ignore them, it just causes them to come back and bite you in the butt,' Miyamoto adds. He attended the PRSA session in Boston.
The firm also needs to remind the community in Woburn, and in its many other world locations 'what it's done for them,' says Miyamoto, who is a senior fellow and accredited member of PRSA and belongs to its Environment Section. 'It's too late for Grace to quench the big flame when it's an ember,' he adds. 'The movie will be really powerful and make Grace look really, really bad. Grace needs to be proactive and send out company spokespeople to tell its side of the story,' he suggests. This would entail media training for spokespeople.
What would Stoler do differently? 'Everything!' he admits. 'When the Woburn leukemia case came up, we had no overall strategy or response plan. We did a miserable job of communicating with government, citizens and our own employees.'
Grace has become a model corporate citizen, 'a constructive member of the community,' says Stoler. It has built solid relationships with the community, the U.S. Environmental Protection Agency and local officials in Woburn, he says. 'We have fully participated in the Super Fund cleanup and made the community part of the effort. We have put in more extensive water treatment systems than is required.'
Grace has also made positive contributions to the Woburn community, adds McGuinness. The company has funded upgraded science programs in local schools, and sponsors the annual Science Fair. Grace works with the fire department in handling hazardous materials and has also joined other companies to establish procedures for toxic waste disposal, she reports. The company has earned praise from the EPA and its toughest critic, the local founder of For A Cleaner Environment (FACE) in town.
Yet the recurring nightmare of A Civil Action continues. 'The movie tends to wash away everything we've tried to accomplish,' Stoler concludes, quoting Napoleon: 'History is the myth men choose to believe.' And maybe only proactive, long-term PR can change history.
'They probably need to hire outside counsel to concentrate on this problem alone for about four years,' Miyamoto advises. 'That's the only way to combat the recurring bad press for the life of the film and the book.'
The Woburn chronology
In the early 1980s, a leukemia cluster was identified in Woburn.
1982: Eight families of child leukemia victims sue Grace and two others in a civil action. At the time Grace has 300-400 staff in Woburn (pop: 38,000).
1986: Complex trial ruling leads to Grace settling with plaintiffs for $8 million. It does not admit liability.
1989: EPA announces clean-up plan for Wells G&H in Woburn. According to local press, EPA opted for a more expensive cleanup after Grace and local activist group FACE requested it.
1992: EPA starts combined Grace-UniFirst groundwater recovery and treatment systems.
1993: Reporter Dan Kennedy, who covered the Woburn trial, cites Grace as 'one of Woburn's model corporate citizens (Boston Phoenix, 12/24)
1994: At the community's invitation, Grace becomes a sponsor and participant in annual Earth Day.
1995: A Civil Action hardcover by Jonathan Harr is published. It receives little media attention.
1996: A Civil Action paperback is published. It ranks no. 1 on the New York Times' bestseller list for 106 weeks. It is now used as teaching tool in colleges.
1996: Scientific information from Ohio State University professor appears to vindicate Grace from allegations of polluting well water in Woburn.
1998: Movie A Civil Action is released Christmas Day.
1999: Jan Schlictmann, lawyer for the plaintiffs in the original civil trail, is going on a lecture tour in Northwest after January 1.