You’re Screwed. Now What?

by Natasha Wolff | November 5, 2015 5:00 pm

You’re on the front page of the New York Times[1]—but it’s not good news. Your company is under investigation. Shareholders are clamoring for your removal. Employees are threatening a lawsuit. What to do? For the best connected, the answer is, “Call Lanny Davis[2].” A lawyer and author, Davis has worked with the likes of Bill Clinton (he was White House special counsel from 1996 to 1998), Whole Foods, Macy’s, Royal Caribbean Cruises, Washington Redskins owner Dan Snyder and Penn State. In his new book, Crisis Tales: Five Rules for Coping with Crises in Business, Politics and Life[3], he shares the lessons learned from 12 years of putting out fires. 

When people are under investigation, their instinct often is to not talk to the press. But you say it’s a mistake?
Yes. It’s almost always it’s a mistake, and for a public corporation, it’s a major one. The story is going to be written whether you talk or not, so the question is, Are there things that can be safely said that can make the story more accurate and balanced? Saying “no comment” is the equivalent of a guilty plea, to most people.

You worked with Martha Stewart during the investigation into her sale of ImClone stock. You’ve expressed frustration that her criminal attorney wouldn’t share what he knew with you. Do you think if he had, she wouldn’t have had to go to jail?
I strongly believe that Ms. Stewart would not have been prosecuted as she was if her attorney and I had worked closely together. In order to do my job in a criminal case, I need the criminal attorney to share all the facts with me, so we can decide together if it’s too dangerous to say anything to a reporter. Ms. Stewart was accused—and convicted—by the media of an insider trading crime before she ever had her day in court, but she wasn’t guilty of insider trading. In fact, the prosecutor never even brought that case.

So do you think the jury felt they had to convict Ms. Stewart of something because they’d already decided that she was guilty?
I assume sincerity, and I have faith in the jury system. But I can conjecture that the publicity about the case—where she was prejudged by much of the media of having traded on inside information—affected some jurors and their view of her. Then, when her lawyer didn’t let her testify, she didn’t have the chance to convey to the jury that she didn’t trade on inside information and that she’d made a few honest mistakes but not criminal ones. 

You’ve counseled President Clinton. Despite his personal crisis, he was able to avoid impeachment and stay in office. Do you think a different outcome could have been possible in General David Petraeus’ case? 
Yes. And he still hasn’t done what should’ve been done.

Which is what?
Tell it all, tell it early, tell it yourself.

But by stepping down from the CIA, didn’t he absolve himself of the need to do that?
General Petraeus thought that by writing a letter saying “I did wrong, and I’m resigning,” it was the end of the story, and it’s not. It’s actually making matters worse if that’s all you do, because everybody sees it as just pure PR. You’ve got to do what I call a Geraldine Ferraro: When she was running for vice president in 1984, she was attacked about her husband [and his business dealings]. She put herself in a room with the media, and she said, “I’m not leaving the room until I answer every one of your questions. I don’t care how painful it is.” And she left that room battered and bruised, but it was over. You’ve gotta kill the beast with facts. It’s difficult to take that advice. I’m being an objective crisis manager when I say General Petraeus didn’t do it the right way, but I’m not criticizing him personally. All I feel is empathy for him. 

Who has been your most challenging client, and why?
Congressman Charles Rangel. I love him dearly, but he was the toughest. He was so angry. He believed, as I believe, he’d done nothing morally, ethically or criminally wrong. [He was ultimately censured on the floor of the House of Representatives for not paying income taxes for more than 20 years on his Dominican Republic condo; the total owed was about $10,000.] He’d been careless. But because he’s so proud, he was unwilling to take proactive measures to prevent the  unhappy outcome we saw.

Do you ever get tired of solving problems?
Yes. I’d love to answer the phone and have someone say, “Hey, Lanny, I’ve got great news for you.” [Laughs] But my job is to handle the bad news. I didn’t choose that position, but I’m a lawyer, and I know the press, and I know politics, and it just happened. After I left the White House, people started calling me because their lawyers were telling them not to talk. They’d say, “What can I do? I want to tell my side of the story.” I had to invent a way to help them tell the truth.

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