Stomaching a Settlement

When you’re attacked, when your character is questioned, when you feel like you’ve been violated, you yearn for one thing – justice.  Vindication.

And maybe a little payback.

As a corporate manager, this is a luxury you can’t afford – at least when it comes to assaults on your good name that occur within the business context.

It is an unpleasant truth that settlements are, most of the time, your best and lowest cost way of resolving disputes.  Even if you don’t want to settle because the attack is directed at your work, your people, or you personally.  You’re still first and foremost an agent of shareholders, and not a free agent that can carve their own path to vengence.

Suck it up

As I’ve previously stated in prior posts, if you spend enough time in management within a large corporation, you’re going to become familiar with lawsuits.  It appears to be a sign of the times.  And while all lawsuits aren’t baseless, moneygrubbing attempts to pry cash out of corporations, most look that way from the perspective of corporate management.

If you are involved in half a dozen or more suits, chances are pretty good that your personal action or inaction will be the basis of one of these.

Yep, it will seem petty, vindictive, and completely unfair.  You will wonder how it looks to your boss, peers, subordinates, friends, family and anyone else that becomes aware of the situation.  You’re almost certainly going to want to strike back.  File a countersuit.  Take the complaint to trial.  Or maybe just smack the plaintiff in the face.

But you can’t indulge these whims.  Remember, you’re an agent of the company, and it is your duty to do what is in the shareholder’s best interest, not your own.

Which means you’ll probably have to settle the case.

In a wrongful termination lawsuit, I was personally accused of intimidating a former employee and then trying to silence him because of an embarrassing investigation he was conducting (embarrassing to the company, not to me personally).  I was outraged as nothing could have been further from the truth.  I wanted to force the former employee into to court so I could tell my side of the story.

The problem was, he did have information that would have embarrassed the company – information he was threatening to publically expose during trial.  Instead of fighting the lawsuit, I knew the right solution was to suck it up and settle.

Only I couldn’t do it.  At least not personally.  I ended up asking another corporate executive to step in and arrange the settlement on my behalf, thus avoiding the temptation to let my emotions overwhelm my better judgment.  In the end, the suit settled and the issue went away.  Painlessly.  Almost.

Even though it was over, however, I wasn’t happy.  Even today I sometimes wish I’d had the chance to tell my side of the story….

Decisions, not justice

When the attack is directed at yo, and you’re sure you are in the right, the normal reaction is to say “see you in court.”

As I’ve blogged in the past, however, the courts while purporting to be tools of justice, in reality only render decisions.  Sometimes those decisions are just, but often they aren’t.

Complex issues try the patience of jurors, and many default to siding with whomever they “like” the best rather than exerting the effort to really understand the situation.  That will rarely, if ever, end up being in favor of a large corporation.  Most business suits seem to turn on issues that are technical and/or just plain dull.  If you’re on the company’s side, you’ve got an uphill battle to convince a jury you’re in the right.

Even bench trials (where the case is decided by a judge rather than a jury) aren’t a slam-dunk.  Judges studied law, not engineering or accounting.  Most have never run an organization, and are likely to have a limited understanding of the difficulties and challenges you face as a manager.  And with a bench trial, there is no group to help claw back an odd or extreme opinion the judge might hold.

I was sued by a former business partner for “failing to complete a contract to purchase his shares.”.  The reason – we discovered accounting shenanigans that occurred during his tenure as general manager.  These revelations substantially reduced the value of the shares.  And there was never a “meeting of the minds” on the contractual terms, and definitely never a signed copy of anything.

That case went to a bench trial because the plaintiff wouldn’t compromise in settlement talks.  I lost the case, I believe at least partially because of the approach we used to pursue the case – we countersued, claiming the plaintiff had damaged the business with his behaviors, and the pursuit of that claim took up a huge amount of the court’s time.  In the end, I felt the judgment went against us largely because we annoyed the judge.

Your reputation will protect you

Yes, you may feel violated, but maybe you shouldn’t.  If your reputation is solid among your peers and superiors, it won’t suffer much due to accusations from the outside.

Everyone on the management team knows these kinds of legal complaints happen all the time.  Odds are good that they will sympathize and back you up.  You only need to worry if there is a pre-existing pattern that the particular claim reinforces.

One employee, terminated for violating U.S. trade laws, threated to expose others on the management team that were, as he put it, “in the know.”  He wasn’t specific about who he was accusing, and as a result, several managers that regularly interacted with him felt he was accusing them (me included).

While a settlement with the manager was eventually brokered (long story, and not particularly relevant to my point), the names of the supposed co-conspirator(s) never came out – even though that was a part of the settlement negotiation.  That left things up in the air as to whom – any anyone – the “guilty” party might have been.

My reputation for honest, above-boards behavior within the company protected me from any fallout.  Because my practice in other areas had always been to stay far away from anything that might be considered illegal, no one believed I was the target of the fired managers threats.

I couldn’t say the same for all those that were accused.


Lawsuits come and lawsuits go, and sometimes it’s going to get personal.  Even though you feel violated by a particular plaintiff, you need to put aside your personal feelings and act on behalf of your employer and their shareholders.  Doing so will likely result in the quickest, least painful resolution of the suit, although it will likely lack the vindication you will want.  If you let your personal feelings and needs overrule those of the business, however, you may be putting your career on the line.  32.5

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To the right is the cover for DELIVERABLES.  This novel features a senior manager approached by government officials to spy on his employer, concerned about how a "deal" the company is negotiating might put critical technical secrets into the hands of enemies of the United States.  Of course, things are not exactly as it seems....

My novels are based on extensions of 27 years of personal experiences as a senior manager in public corporations.