Preparing For Crisis Management

Sutherland partners Matt Gatewood and Susan Lafferty recently presented a Legal Quick Hit to the ACC’s Energy Committee on the fundamentals of preparedness for crisis management following significant operational failures.

The outline of that presentation is below:

• Identify the risk inherent in every operation
  • Monitor the pulse of industry changes, including new hazards and threats
  • Provide systems for training new personnel and understanding industry trends
  • Define (and conduct training on) the roles and responsibilities in a crisis
  • Understand enforcement risks and potential exposure gaps
  • Know protections/exposure in commercial documentation for all projects

• Be prepared to respond to all drivers of exposure following an incident
  • The media/public opinion
  • Anticipated political pressure points
  • Government investigations (from industry regulators and from Congress)
  • Legal team needs to be proactive, not reactive
  • Understand each response’s impact on strategy in inevitable litigation

• Conduct comprehensive crisis management exercises to test and prepare company
  • Different from traditional environmental response planning drills
  • Focus is more on crisis management as opposed to incident response
  • Tests executive leadership team, legal team (inside and outside counsel)

• Key best practices for crisis management following an incident
  • Legal team needs to play a leading role
  • Identify and balance immediate and long-term goals
  • Do not respond (or respond) in a way that makes the matter worse!
  • Do not hide, but choose words carefully

• Common pitfalls in crisis management
  • Failing to disclose basic, undisputed facts quickly (hurts credibility)
  • Underestimating potential consequences, especially in future litigation
  • Failing to protect privilege, including privilege of internal investigation
  • Misplacing public focus on business interests
  • Failing to master the company’s own information (know what you have)
  • Blaming others unnecessarily