Settling With Victims Early Can Prevent Costly Litigation

Penn State University President Rodney Erickson recently stated that the university hopes to address victims’ concerns and civil claims related to the Jerry Sandusky child sex abuse scandal “privately, expeditiously and fairly.” Other universities and institutions could benefit from this type of approach.

Penn State University President Rodney Erickson recently made the public statement that the university hopes to resolve victims’ concerns and civil claims related to the Sandusky abuse “privately, expeditiously and fairly.” The Executive Team of the National Center for Higher Education Risk Management (NCHERM) encourages this approach — from a risk management perspective — and believes other colleges and universities may benefit from this lesson as well.

We have watched as higher education has become more and more litigious, and we have seen the costs of that litigation rise astronomically. While some cases are worth fighting and no one wants colleges to become settlement mills, we need to get better at fighting the right cases and settling the rest early and effectively, often before the lawsuit is ever filed. 

The airline industry has “piloted” this technique and deploys it successfully by attending immediately to the scene of crashes and to the families with ready admissions of responsibility, apologies, financial assistance and long-term support. Why? The research shows that lawsuits don’t automatically result from injuries. Instead, grieving loved ones and injured parties are more likely to sue when they perceive corporate entities as uncaring, unsympathetic and unwilling to be accountable. 

Related Article: Managing Crises Means Managing Victims

By demonstrating an ongoing commitment to caring, sympathy and accountability, airlines have managed the risk of costly litigation. Families accept early settlement offers from corporate outreach representatives, and are much less likely to sue than victims or families of those injured in other corporate contexts. This approach was also used effectively to settle many of the claims arising from the terrorist attacks on 9-11. 

Clearly, President Erickson knows that prolonged litigation will inhibit healing for the victims, their families and the Penn State community. Litigation will uncover facts in discovery that will only deepen the public’s understanding of the depth and extent of the harm. Litigation will prompt federal Title IX claims that have thus far received scant media attention. Litigation will keep the story alive, in the media spotlight and the public eye, rather than empowering the process of healing that can start with closure on the issue of blame. The same holds true for the NCAA penalties. Rather than contest them, Penn State’s Trustees should continue to accept the wisdom of Erickson’s decision to sign the consent decree. Anything else will simply allow the wound to fester by prolonging the public controversy and the private pain.

The NCAA’s imposition of penalties that will force systemic overhaul is both proportionate and appropriate, regardless of whether “innocent” individuals will suffer for wrongs for which they bear no culpability. A refusal by the trustees to be humble when needed would only serve to antagonize the families and victims, who would unleash a decade of litigation that will make the $60 million NCAA financial penalty look paltry by comparison. 

NCHERM has used early settlement to successfully address serious misdeeds committed by college or university employees and we encourage other institutions to consider a similar approach. When wrongdoing (irrespective of criminal acts) is plain, we believe that early settlement can contain the situation and will typically provide a better resolution for both victims and institutions than would a drawn-out legal battle.

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