The Threat of Toxic Torts

Ruskin, William A., Management Review

You are a manager at a manufacturing company. While driving to work one morning, you hear on the radio that a large chemical spill at the company's key production facility has leaked hazardous chemicals into the ground. You arrive before 8:00 a.m. to find a note on your desk requesting your immediate presence in the CEO's office. Me executive suite bustles with activity. A camera crew from a local television station is camped outside the CEO's door. Inside the boardroom, the general counsel, the vice president of production, and the directors of government, public relations, and safety and health are huddled in an emergency meeting.

Because the middle-class community surrounding the plant has always been outspoken on environmental issues, numerous politicians-including the governor have already registered their alarm by telephone and fax.

Nonetheless, the situation could be worse. Preliminary reports indicate that the contamination has been confined within the facility's fence line. No personal injuries have been reported. The community draws its drinking water from municipal wells several miles away; there does not appear to be any imminent risk of harm to residents living near the plant. Still, angry local home owners are already demanding assurances that neither their property nor their health has been jeopardized.

Taking you aside, the CEO expresses his first concern: what to tell the governor. The CEO's second worry is what to tell the press. His third concern: what to tell his wife, who is planning a cocktail party for local civic leaders that evening. The ever-present threat of litigation is not at the top of his list of concerns because in confronting an environmental crisis, the consideration of potential legal liabilities is only one issue among many. The very integrity of the company's name is at stake and its value cannot be assessed in legal terms. Clearly, the primary constituencies to address are the community, the media and the politicians.

DON'T OVERLOOK …

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Publication information: Article title: The Threat of Toxic Torts. Contributors: Ruskin, William A. - Author. Magazine title: Management Review. Volume: 79. Issue: 6 Publication date: June 1990. Page number: 50+. © 1988 American Management Association. COPYRIGHT 1990 Gale Group.

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