Reputation Management: How To Avoid Scandal Because Of Breach Of Contract

Reputation Management: How To Avoid Scandal When There’s A Breach Of ContractA professionally prepared agreement is essential to reputation management. Because it can help you avoid a PR disaster when there’s a breach of contract.

How bad can it get?

As an example, look at the lawsuit by the National Rifle Association (NRA)* against its ad agency for breach of contract. Among other things, the NRA is seeking $40 million in compensatory damages plus punitive damages. The lawsuit and related news stories will do nothing to help either party protect its reputation.

So, how do you prevent bad publicity? Here are 4 important reputation management tactics…

1. Pre-Agreement Due Diligence

Before signing a business contract, research the other party. Check to see if there is a history of lawsuits or the other party using social media to hurt another company’s reputation online. Walk away from the potential deal if there is such a history.

2. Confidentiality

The written agreement should contain confidentiality/non-disclosure provisions to protect important data.

3. Non-Disparagement

Your contract should provide that neither party will disparage the other during and after performance of the agreement. In some instances, it may make sense to include a large liquidated damages amount to be paid by a party if they do decide to denigrate the other party in violation of the agreement.

4. Alternative Dispute Resolution (ADR)

Rather than publicly airing the dispute with nasty claims and counterclaims in a lawsuit, it often makes sense for a contract to provide for confidential alternative dispute resolution. This can include mediation and binding arbitration using JAMS or AAA rules and procedures.

Other Reputation Management Contract Terms

Of course, there are other provisions that an experienced business contracts lawyer will include in your agreement for reputation management. Just make sure you put the right contract in place that protects your good name in case the relationship between the parties deteriorates. Because you can’t afford to leave business reputation management to chance.

* Disclosure – Business Lawyer Mike Young is a member of the National Rifle Association (NRA) and strong supporter of Second Amendment rights. However, he does not represent the NRA as legal counsel in this lawsuit or other matters.

Author Mike Young, Esq.

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