WSJ Crisis of the Week: Tyson Finds Itself in Game of Reputation Chicken

by Aaron Gordon

Schwartz Media Strategies CEO Tadd Schwartz shares with the Wall Street Journal his crisis communications plan for Tyson following a lawsuit and negative analyst report.  

 

WSJ

By Ben DiPietro

Food processor Tyson Foods Inc. takes crisis center stage after being accused of rigging poultry prices. Lawsuits filed against Tyson allege the company and other producers engaged in fixing prices for its poultry products, prompting one analyst to issue a report suggesting the issue could become a big problem for Tyson—news that sent the company’s stock price lower. Other reports struck a different tone about the company, and the stock rebounded the next week.

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Tyson sent out a statement in which it vowed to defend itself against the allegations, saying: “While we don’t normally make substantive comments regarding pending litigation, we dispute the allegations in the complaints as well as the speculative conclusions reached by the analyst, and we will defend ourselves in court.”

Using the company’s statement, the experts break down its response, how well it communicated its message, and what it should do next?

Tadd Schwartz

Tadd Schwartz, president, Schwartz Media Strategies: 

“When clients are faced with litigation, [crisis managers] align our communications plan with the underlying legal strategy. In instances where the lawsuit at hand is without merit, often the move is to attack and undermine the claims with a dismissive statement, as Tyson Foods has done amidst allegations of price-fixing.

“Assuming it is confident in its defense, Tyson was wise to issue a statement denying the legal claims while disputing the conclusions drawn by the analyst. The statement puts Tyson on the record, protects the company’s brand and buys the company time as it prepares to defend its position in court.

“If the claims in the lawsuit are indeed without merit, then Tyson should continue to firmly deny allegations publicly while fighting its accusers in court. However, Tyson must be prepared to mitigate public backlash in the event evidence of wrongdoing surfaces.”