The recent news that a jury in California has awarded $290 million to the family of three people killed after a Ford Bronco rolled over is bound to reawaken tort-reform advocates, who love to use exceptional cases such as this to support their arguments about "runaway jury awards" for victims and their lawyers.
And this case gives reformers plenty of fodder. The sum is the largest punitive award ever affirmed by an American court in a personal-injury case. Furthermore, the jury appears to have applied some idiosyncratic ideas: One recounted a recurring dream in which her children were killed in a similar accident, and Ford lawyers stood by asking, "Where's the proof?" Another gave an inaccurate account of a TV show about Ford that jurors had been told not to watch.
There's no doubt that awards such as this create a perception problem, part of which results from a failure to understand the difference between compensatory damages and punitive damages, both of which end up in the plaintiffs' pockets. The $290 million sum is barely enough to be considered punitive to a company of Ford's size - nine days' profits, according to the appeals court, or the equivalent of a $1,250 fine to someone who earns $50,000 a year. But it's an outrageous sum to fall into the hands of the family and its lawyers. Perhaps the system needs to be changed so punitive awards go into a trust, most logically to finance consumer-safety watchdogs that can prevent future incidents.
From a PR perspective, however, the case raised other issues. One reason the award was so high was the fact that Ford marketed the Bronco as "tough" and "rugged," despite having what the plaintiffs argued was "the weakest roof in Ford's history." Another was the discovery of a Ford document suggesting that a hollow hump suggesting the appearance of a non-existent rollover bar was "a rollover bar appearance theme."
Where were the PR pros when those design specs were discussed? My guess is they were on another floor, or in another building, discussing the color of the next Bronco press kit. At Ford, as at most companies, decisions with profound PR implications were almost certainly being made without the input of anyone from the PR department. (If I'm wrong, and there were PR people who agreed that a "rollover bar appearance theme" was a good idea, I trust they are all currently looking for jobs slinging hash at a local diner.)
I've long argued that every decision a company makes has reputational implications as well as the operational, financial, and legal implications that are considered routinely and formally. This case provides yet more evidence that factoring in those reputational implications will lead to more efficient - and less expensive - decision making.
Paul Holmes has spent the past 15 years writing about the PR business for publications including PRWeek, Inside PR, and Reputation Management. He is currently president of The Holmes Group and editor of www.holmesreport.com.