Shares in United Continental Holdings Inc. parent company of United Airlines fell 5% in premarket trading early this morning as the negative blowback from an incident in which a passenger was forcibly dragged off a plane overwhelmed an earlier uptick.

Analysts predicted that the carrier was set to have about $1.1 billion wiped off its market capitalisation, after gaining $330m on Monday.

As well as causing the airline to "re-examine" its policies, the incident shows how the age of smartphone cameras and twitter have raised the stakes for corporate PR practitioners.

As six million viewers of the shaky footage have seen, the incident featured a screaming passenger, said to be an Asian doctor, being dragged down the aisle of a plane at Chicago's O'Hare airport by security men, having refused to surrender his seat on an over-booked flight.

The negative PR generated by the incident has been fanned by the mainstream media, and by social channels like Twitter, whose users fell over each other to express outrage, or - just as damagingly - to make blackly comic jokes at United's expense.

One smaller scale competitor Southwest Airlines crafted an advertisement, widely shared on social media, with the copy line: "Southwest: We beat the competition. Not you."

As well as an internal email blaming the passenger for being "disruptive and belligerent"", United Airlines CEO Oscar Munoz's authorised a statement that provoked further negativity.


Commentators "translated" the statement to imply that United saw itself as a victim itself, and was not taking responsibility for the violence inflicted on the passenger, implicitly blaming "the authorities" in Chicago Aviation Security.

How long will United Airlines suffer the backlash from Sunday's on-board altercation? A very long time if this list of great corporate PR disasters is any guide.

1: Nestlé

One of the great corporation v activist confrontations of the 1970s, Nestlé's policy of marketing infant formula milk in the developing world led to a US boycott of its products starting in 1977 that eventually spread to Europe.

Organisers of the boycott were enraged that the "aggressive" marketing of powdered milk not only discouraged the traditional practice of breastfeeding, with all of its developmental and economic advantages, in favour of bottle feeding. In the circumstances of developing countries (polluted water, low literacy rates, lack of sterilisation facilities), this was believed to carry multiple risks to infant health.

Nestlé consistently denied and countered these allegations, but the issue has remained live, and a cause celebre for some campaigners ever since.

2: Ratners
The self-inflicted corporate wound that defined the PR disaster for the modern age, so much so that the commission of a major gaffe is now known as "doing a Ratner". The man himself meanwhile has traded on his notoriety, once allowing himself to be photographed pointing a gun at his temples.

In 1991 Gerald Ratner, chief executive of the then omnipresent high street jeweller wiped £500m from the value of Ratners jewellers with one speech to the Institute of Directors.


He added for good measure that his stores' earrings were "cheaper than an M&S prawn sandwich but probably wouldn't last as long".

As the share price plummeted as customers steered clear of the stores, Ratner hired a chairman in an attempt to steady the ship, but it was too late, the damage was done and Ratner himself was fired the following year and the damaged name disappeared as the group then changed its name to Signet Group.

Gerald Ratner at a business event in 2015

3: Sunderland FC
The business of football is subject to different dynamics than its non-sporting mainstream but corporate reputation must be treated with extreme delicacy. PR team at Sunderland must have agonised at length at how much support to give their boss of only a few months Scot David Moyes last month when he made what he thought was a playful comment about a female sports reporter "getting a slap" for asking an impertinent question.

His comments were "wholly inappropriate" Sunderland said, as Moyes apologised to Vicki Sparks for the comments made in March.

"Such actions are not condoned or excused in any way," Sunderland's statement continued ... "The exchange between the manager and a BBC reporter was wholly unacceptable".




This amount of grovelling was deemed sufficient for Sunderland to head off pressure to sack Moyes. Memories about misdemeanours in football can be short, if the performance is up top expectations, but Moyes has a lot of ground to make up on the pitch if he wants to repair the damage to the Northeast team.


4: Volkswagen
The German car maker has escaped the historical PR handicap of first being championed by Hitler, but it's hard to see the public forgetting the so called "diesel dupe".

In September 2015, the US Environmental Protection Agency (EPA) found that many VW cars being sold in America had a "defeat device" - or software - in diesel engines that could detect when they were being tested, changing the performance accordingly to improve results. The car giant has since put its hand up to cheating emissions tests in the US.

The scandal, which has also spread to other manufacturers, sprang from VW's push to sell diesel cars in the US on the basis of their low emissions, so the discovery that about 11 million cars worldwide, including eight million in Europe, are fitted with the so-called "defeat device" will take some living down.

Matthias Mueller, VW's chief executive, has since blamed a "misunderstanding of American law", saying that their over-zealous technicians "reached targets with some software solutions which haven't been compatible to the American law. That is the thing. And the other question you mentioned - it was an ethical problem? I cannot understand why you say that."

5: HBOS Reading
As if the reputation of Halifax Bank of Scotland was not sufficiently trashed during the banking collapse of 2008, the good name of the once-stolid Scottish institution was dragged comprehensively through the mud by a lurid criminal conspiracy.

A branch of the bank in Reading was accused of colluding with a dodgy "business turnaround" company in exchange for perks including luxury holidays and the services of prostitutes.

Unfortunately for the bank, the long and complex case has not closed with the conviction and imprisonment of the six perpetrators (two of them HBOS employees) and the payment of £100m in compensation to companies who were destroyed in the process.

There is little a corporate PR team can do in such circumstances.

The Financial Conduct Authority (FCA) is resuming a probe, suspended in early 2013, while Thames Valley Police conducted its own six-year investigation into the scam, focusing on "the extent and nature of the knowledge of these matters within HBOS and its communications with the Financial Services Authority after the initial discovery of the misconduct".

Depending on how thorough the who-knew-what-when investigation proves to be, the Lloyds group's spin doctors may need to bring their best game to talking up the integrity and other virtues of the Bank of Scotland brand.

Executives jailed for their part in the HBOS Reading scandal