Jeff Jarvis of BuzzMachine wrote an excellent post today about Wal-mart’s recent bad PR move. In the recent legal suit Wal-mart won against a former employee, who now has brain damage due to an auto accident, Jarvis’ perspective is right on point with respect to Wal-mart’s doozey of a move here. This is a case that underscores how sometimes company management should disregard their lawyers’ advice and seriously weigh the cost/benefits of an action that has all the promise of a PR calamity–all for a few dollars. As the world’s leading retailer, Wal-mart earns around 11.25 billion in profits. You’d think that this is a company that can afford to forgo persecuting a former employee, dragging her to court, and taking the only funds she won in the accident lawsuit that was earmarked to care for her. A big whopping $275,000. (They originally asked for almost twice as much but the judge decided against their request.)
My guess here is that their PR firm, Edleman, did in fact counsel Wal-mart against pursuing this legal suit, but this is also a huge assumption that Walmart and its team of lawyers even kept Edleman in the loop with their decision to pursue this suit. Wal-mart’s bad judgment to wring the few dollars from a physically and mentally-impaired, former employee is frankly outrageous. (By the way, Ms. Shank also lost her 18-year old son, a soldier, in the Iraq war.)
Evidently, the public outrage to the story of Debbie Shank now has come back to bite Wal-mart and they are back-peddling. After taking Ms. Shank to court in several rounds and more than 3 years to win the measly $275,000 award, the world’s biggest retailer is considering holding off on taking the money after all.
My goodness, the long-term damage the company has done to itself, future sales and profits, and any remaining company goodwill— all with their focus on an extra dollar exemplifies cutting off your nose to spite your face. As Jarvis points out in his post, Wal-mart should have borrowed a page from Google’s corporate mantra of “don’t be evil.”