Mike Paul's Blog - November 2006

Michael “Kramer” Richards' Reputation in Crisis: Racist or Ignorant and Angry?

“Fifty years ago we'd have you upside down with a f***ing fork up your ass!”

Screamed Michael “Kramer” Richards as the actor tried his hand at comedy at the Laugh Factory in L.A. last week, but lost it in a racial rant after allegedly being heckled by two black men in the audience.

According to the Associated Press, two black men, who say they were insulted by actor and comedian Michael Richards during his racist rant at a comedy club, want a personal apology and perhaps some money, their lawyer says. Richards, who played the wacky Cosmo Kramer on the hit TV show "Seinfeld," appeared onstage at the Laugh Factory in West Hollywood last week.

Frank McBride and Kyle Doss, say they were part of a group of about 20 people who had gathered at West Hollywood's Laugh Factory to celebrate a friend's birthday.

Their lawyer, Gloria Allred, says they were ordering drinks when Richards berated them for interrupting his act.

When one of their group replied that Richards was not funny, the comedian launched into a string of obscenities and repeatedly used a derogatory term for African-Americans. A mobile phone video camera captured the outburst.

The camera started rolling just as Richards began his attack, screaming at one of the men, "Fifty years ago we'd have you upside down with a f***ing fork up your ass."

Richards continued, "You can talk, you can talk, you're brave now motherf**ker. Throw his ass out. He's a nigger! He's a nigger! He's a nigger! A nigger, look, there's a nigger!"

The crowd is visibly and audibly confused and upset. Richards responds by saying, "They're going to arrest me for calling a black man a nigger."

One of the men who was the object of Richard's tirade was outraged, shouting back "That's un-f***ing called for, ain't necessary."

After the three-minute tirade, it appears the majority of the audience members got up and left in disgust.

Richards, who played Jerry Seinfeld's wacky neighbor Kramer on the long-running TV comedy Seinfeld, made a nationally televised apology on The Late Show with David Letterman this week.

He has since publicly apologized to two prominent civil rights leaders, the Reverend Jesse Jackson and the Reverend Al Sharpton. Michael Richards is due to appear on Jesse Jackson’s radio show to discuss the crisis tomorrow.

Gloria Allred complained today that Richards "has not apologized to his victims directly, face to face, man to man."

Richards' publicist said his client wants to apologize to both men, who are black, but has not been able to locate them.

The video of Richards' outburst shows several people getting up and walking out as he shouts at the audience.

His publicist, Howard Rubenstein, said Richards was not considering any demand for payment.

"He's not dealing with that," Rubenstein said. "He wants to apologize to them directly and then see what happens."

PHOTO: Owner Jamie Masada And Comedian Paul Rodriguez Successfully Defend The Laugh Factory

A few comments from the Reputation Doctor regarding Michael “Kramer” Richards racial rant:

Michael “Kramer” Richards’ reputation crisis should be about heart work and not spin.
I was a returning guest on Fox News’ O’Reilly Factor last night as a reputation management expert and I was asked to analyze and critique Richards’ reputation in crisis. I emphasized three things in the interview: 1) This case is more about heart work than head work and Richards must examine himself internally before offering any communications externally. 2) Excellent reputations are built with truth, honesty, accountability, transparency, humility and consistency. 3) Richards needs to go the rehab immediately to examine his deep and personal psychological issues which are hurting many other people, as well as himself. In my opinion, he needs to be in rehab for a minimum of 6 months to properly examine the problem and then develop new and important habits for lasting change.

His PR counsel, Howard Rubenstein, has already made big mistakes in reaching out to Jesse Jackson and Al Sharpton. They were not in the audience and should not be the focus for repairing a reputation.
I also mentioned this on Fox News. Jackson and Sharpton are men who love to pour gasoline on a fire and their egos love the media limelight. The proper way to contain this crisis and do the right thing would be to focus on the audience which was at the Laugh Factory the night of the tragic racial rant. I recommend working with the Laugh Factory to best reach all those in attendance of Richards' stand-up routine. He should try to give them all an honest and direct apology in person, face-to-face. Why? Because all those in attendance were offended, especially the black audience members. Those offended were not just the two black men in the audience now seeking cash from Richards.

Michael Richards is not a stand-up comic. He is an comedic actor. There is a BIG, BIG difference!
Michael Richards considers himself to be a stand-up comic, but he is not. Just ask the real stand-up comics on the comedy circuit. They know how to properly handle a heckle. The goal is to turn lemons into lemonade with a better joke, not with an angry racial tirade! In fact, it is one of the first things a true comedian learns on the stand-up circuit. Michael Richards was trying to resurrect his career by performing more stand-up routines. Well, guess what? It backfired! I believe it was very wise for the Laugh Factory to separate itself from Richards. Owner Jamie Masada and comedian Paul Rodriguez (a friend of mine) both did a good job. They had to defend their comedy club and support their audience. In doing so, they retained their reputations. Michael Richards' anger issues surfaced more than once in very ugly ways on stage.

Hire a professional crisis PR and reputation management counselor immediately when in crisis. Waiting even 24 hours may be too late and may increase the damage to your reputation significantly.
Michael Richards' actions emphasized another important rule: don’t wait, don't fake it and don't wing it when your reputation is in crisis! If you or your team don’t have significiant crisis PR and reputation management experience, get professional crisis PR and reputation management help immediately! Richards obviously was not properly counseled for his appearance on the Letterman show or the evening after his racial rant. He is an actor and this was not acting. He was very uncomfortable and inexperienced on stage and during his post tirade interview. Seinfeld set the whole interview opportunity up to help his friend on Letterman, and Seinfeld also sought to protect his own reputation. There is a reason why seasoned experts in crisis PR and reputation management make as much or more than seasoned attorneys. Why? Because your reputation is everything! Many attorneys try to pretend to be experts in the court of public opinion, as well as the court of law. This is a big mistake. Ironically, I’ve had to bail out many attorneys in reputation crises themselves. If you are an attorney, it is best to hire seasoned crisis PR or reputation management experts to co-counsel your clients in both courts (the court of law and the court of public opinion) in cases like this. Learn from Michael "Kramer" Richards' mistakes and value your own reputation too. Hey, you don't want to become a negative YouTube video played over and over again like Richards, do you?

Remember, do the right thing when your reputation is in crisis and seek the counsel of an experienced reputation management expert. It will be a major challenge, but ultimately the rewards of repairing your reputation will be great. Why? Because Your Reputation Is Everything! ™

Mike Paul is editor of The Reputation Doctor blog. The Reputation Doctor is a nickname given to him by various clients. Mike's blog is located at www.ReputationDoctor.com. He appears regularly on Fox News Channel, CNN, MSNBC, Court TV, ABC News, ESPN, CBS News, BBC, and others as a weekly contributor and expert in the global news regarding leaders, celebrities, corporations and other organizations with reputations in crisis. Mr. Paul is also president and senior counselor of MGP & Associates PR (www.mgppr.com), a leading strategic public relations and reputation management firm based in New York. For interview requests, speeches, senior counseling or other business opportunities with Mr. Paul, call 212-595-8500 or email info@mgppr.com.

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Comment from: Mike [Visitor]

Michael Richards’s use of the word nigger out of anger only exposed his inner self. I'm shocked to see people like Jerry Seinfeld and Rosie O'Donnell come to Richard's protection. The reason is very clear: deep down, they understand with Richards. They know that anger could set free their inner unbelievable Racist as surely as anger turned the imaginary Dr. Banner into the Incredible Hulk, a brutish, thoughtless beast bent on devastation. JN0-201 exam , 1z0-040 exam , 250-365 exam

Jul 31, 2009, 12:50 am

Comment from: http://www.gratiskasino.com/ [Visitor] · http://www.gratiskasino.com/

I am so disgusted by this, I am actually nauseous. I'm going to send this clip to all of my media friends.I guess he won't be known as a funny man anymore. That was just disrespectful.

Apr 8, 2010, 3:37 am

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The New Corporate Reputation Crisis: The Backdating of Stock Options with Executives and Corporate Boards in Crisis

“Of 120 companies involved in the snowballing backdating scandal, more than 40 percent share directors with other implicated companies.”

A corporate governance research firm, The Corporate Library, said in a recent report.

According to the Associated Press, on tennis courts and golf courses, in bars and restaurants, at meetings and conventions, it seems corporate board members spread the word about a novel way to boost executive compensation – backdating options.

A study released last month suggested that the common link between companies that backdated options was a network of directors who sat on some of the same company boards. Now many of them, their companies and their chief executives are losing their jobs because of it.

Of 120 companies involved in the snowballing backdating scandal, more than 40 percent share directors with other implicated companies, The Corporate Library, a corporate governance research firm, said in a report Thursday. That proportion of interconnected boards is much higher than would be expected from a similar, randomly selected sample, the study found.

“Director interlocking relationships are fast becoming what appear to be the most important characteristic and indicator of backdating problems,” the report said.

Options grants give the recipient a right to buy a stock at a fixed “strike price,” which is generally set at the stock's market price the day of the grant. Generally, a company's board or compensation committee must approve its options grants to top executives.

Options holders benefit if the stock rises above the strike price because it enables them to buy stock at the lower price. In the backdating scandal, companies have dated option grants to days when the stock was at a low, enhancing the potential benefit.

The scandal was first reported in March by The Wall Street Journal, which calculated the tiny odds of companies randomly making grants on the days they chose, when the stock was at its lowest prices for the year or for the quarter. For instance, the Journal found the odds of one executive's options being timed so well, without backdating, were about 200 million to one.

H. Nejat Seyhun, a finance professor at University of Michigan, said one of his studies found that “directors are often participants, as well as beneficiaries, of backdating.”

For instance, the odds that options grants to UnitedHealth Group Inc. director Richard T. Burke occurring randomly were more than a trillion to one, Seyhun found. In Burke's 27 options grants, he got the best price available for a 91-day period five times.

Seyhun said the odds of some of Burke's grants occurring randomly were even narrower than the odds of randomness for grants given to William McGuire, the company's Chairman and CEO, who agreed Sunday to step down from both posts after an internal probe of the company's option practices. The odds of his all of his grants occurring when they did were 45 billion to one against.

UnitedHealth spokesman Mark Lindsay said that during the time period in question, “Option awards were distributed broadly, and based on merit, to over 14,000 employees.”

At least 135 public companies have disclosed Justice Department, SEC or internal investigations of their option grants, according to an Associated Press review. So far, at least 39 executives and board directors at 19 companies have been fired or resigned.

Some of the directors on multiple boards of implicated companies include Millard S. Drexler, former chief executive and a director of retailer Gap Inc. also sits on the board of Apple Computer Inc. Both companies have uncovered troubles with options grants after internal reviews. Drexler left Gap in 2002 has been CEO of retailer J. Crew since 2003.

J. Crew and Apple representatives had no comment. Greg Rossiter, a spokesman for Gap, said that the company's internal review had found no backdating or errors in options granted to executives at or above the vice president level and less than $5 million in errors related to options given to lower-level employees. He referred questions about Drexler to J. Crew.

A few comments from the Reputation Doctor regarding the growing corporate crisis of fraudulently backdating stock options:

WARNING TO CORPORATE EXECUTIVES: Keep it up, and you too will be caught!
Fraud is as old the origin of man. Why? Because we as humans are flawed. We need true accountability to stay on the path to truth, but rarely seek it. We are fearful of transparency and do all we can to try to protect our lies and deceit. We can not do it alone. We need help and reputation management counselors provide help when in these storms.

Denial is your enemy and honesty is always your best friend.
Doing the right thing is always difficult. It is the biggest challenge in my counsel of leaders and corporations with reputations in crisis. Learning that the truth always bubbles to the top is difficult for many to understand. Some truly believe hiding works. It never works for the long term. Still don’t believe me? How many examples of reputations in crisis do you have to read, hear or see in the news media to understand?

A message from clients who have learned the hard way: selling your soul, integrity and your good name is never, never worth the money!
Over the years, I have had the honor of counseling many top corporate clients. These clients have included CEOs and board members of global corporations. They have all shared the same advice to those still lying and stealing for money when they finally hit rock bottom: lying and stealing is never worth the money in the end. Selling your soul will take a toll on your mind and you will never be happy. The way my firm practices reputation management is like a 12-step program for your reputation. There is really no other way to truly help those with reputations in crisis. Most clients must hit rock bottom before they are truthful with themselves, and that is the first step in rebuilding their reputations. They must be honest with themselves before they can be fully honest and transparent with others. This is a valuable lesson for us all.

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Comment from: CocoChanels [Visitor]

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Help, please. All recommend this program to effectively advertise on the Internet, this is the best program!

Jun 26, 2009, 6:31 pm

Comment from: backdating option [Visitor] · http://www.backdatingisnotacrime.com/backdating-reference/another-loss-for-uncle-sam-judge-dismisses

.., back dating scandal is still to broad to consider illegal.. i agree that this is not really fair in some way but it will be depending on its usage...

Jan 13, 2010, 2:04 am

Comment from: reputation management [Visitor] · http://www.reputationmanagementkings.com

I would like to share Reputation is branding. A company who has to deal with customers can not ignore it. However, competitive environment spells the action path. Banks survived were those which were supported by paying taxpayers' money. Had they not received this free money, would they survived? Difficult to reply. Eurotrain or utilities are sort of essentials. People can not simply ignore them. This will be probably strong reason that they will come up prosperer.We keep our fingers crossed that such companies listen to customers and tax payers.

Feb 12, 2010, 5:50 am

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Trans Fat Is the New Cigarette - Packaged Food Companies and Fast Food Chains Have Reputations In Crisis!

“If you removed trans fat from the planet, the only people who would feel the difference are the people who sell the trans fat.”

Commented Dr. Steen Stender, one of the leading Danish experts who lobbied for the anti-trans fat law in Denmark.

According to the Associated Press, two years ago, Denmark declared war on artery-clogging oils, making it illegal for any food to have more than 2 percent trans fats.

The result? Today, hardly anyone notices the difference. The french fries are still crispy. The pastries are still scrumptious. And the fried chicken is still tasty.

Denmark's experience offers a hopeful example for places like Canada, Chicago and New York City, which are considering setting limits on the dangerous artery-clogging fats.

Trans-fatty acids typically are added as partially hydrogenated oils to processed foods such as cookies, margarine and fast food. They are cheaper to produce than healthier oils -- such as canola, corn or olive oil -- and give foods a longer shelf life.

Producers also argue that removing them from processed foods will change tastes and textures beloved by consumers.

However, trans fats also have been called the tobacco of the nutrition world. They lower good cholesterol while raising bad cholesterol.

Even eating a daily amount that is less than 5 grams of trans fat -- the amount found in one piece of fried chicken and a side of french fries -- has been linked with a 25 percent increased risk of heart disease.

"No other fat at these low levels of intake has such harmful effects," said Dr. Dariush Mozaffarian, a cardiologist at Harvard's School of Public Health.

It is still too early to tell if removing trans fats from food in Denmark has improved the country's health.

The Danish health ministry reports that cardiovascular disease has fallen by 20 percent in the past five years. However, other countries have reported similar drops in heart disease where smoking has been restricted and where industry has made efforts to improve some foods.

In countries that are making no effort to regulate the amount of trans fat in food, such as Hungary and Bulgaria, heart disease rates have continued to climb.

Denmark is the only country to have so sharply limited trans fats, passing a law in 2003 that came into effect in 2004, making it illegal for any food to contain more than 2 percent of trans fat.

For Danes like Troels Nyborg Andersen, the government's decision means he feels less guilty about his fast-food habit.

"I know trans fats are bad, but you don't think about that when you're hungry," said the 27-year-old Copenhagen native, chomping a hamburger. "It's good that the Danish government got rid of trans fats so that I don't have to worry about it."

"We wanted to protect people so that they would not even have to know what trans fat was," said Dr. Steen Stender, one of the leading Danish experts who lobbied for the anti-trans fat law.

Though obesity rates are rising in Denmark, they are far below those of most countries: Just 11 percent of the Danish population was obese in 2005, less than half of Britain's obesity rate, estimated at 23 percent.

When faced with the prospect of a trans fat ban, industries typically rebel. Other countries in the European Union initially objected to Denmark's ban, arguing it would be economically unfair since their foods could not be legally imported into Denmark.

Many producers also were concerned about the possible change in texture and taste without the additives.
Preserving the delicacy of traditional Danish pastries was a major concern at Copenhagen's famed La Glace cafe, renowned for its pastries and cakes. When the trans fat law kicked in, its bakers began experimenting.

"There was a bit of a crisis," admitted Marianne Stagetorn Kolos, La Glace's owner.

The first attempts were disastrous. The trans fat-free margarines melted too soon, destroying the flakiness of the 81-layered pastries.

"Everything was flat," Stagetorn said. Luckily, the problem was solved by switching margarine suppliers.
Customers like Anne Petersen haven't noticed.

The pastries "taste just as good as they always did," said the 59-year-old sales assistant, who favors the raspberry version. "If it wasn't for the law, I never would have known that there wasn't any trans fat."

Stender and other health experts say Denmark's trans fat ban should be adopted worldwide.

"There's no reason it cannot be done elsewhere," he said, explaining that the food in Denmark is not markedly different from food anywhere else. "If you removed trans fat from the planet, the only people who would feel the difference are the people who sell the trans fat."

We can learn a lot from Denmark’s leadership in dealing with trans fat. They put health before profits.
A MESSAGE TO CORPORATE FOOD GIANTS: You can learn a thing or two from Denmark. If the long-term goal in business is to build brand loyalty for life through strong affinity marketing, isn’t Truth with a capital T a corporate brand’s best friend? Isn’t hiding the truth the same as lying to your customers? Won’t building back trust be very difficult if the whole truth rises to the top regarding trans fats and your company? Here is a prediction: if your company does not switch to a very healthy non-trans fat oil before the end of 2007, the impact on your various brands still using trans fat will be devastating.

Packaged food companies, fast-food chains and restaurants all over the world have known trans fats are very bad for many, many years.
Here is the simple formula and bottom line: trans fats both lower your good cholesterol and raise your bad cholesterol. That is a crisis combination for any person eating a lot of trans fat, especially our children who don’t know any better, who are now hooked like an addict in search of a needle.

Trans fats in food is the new “cigarette” crisis.
I was quoted in Advertising Age magazine over a year ago discussing the reputation crisis for packaged food companies and fast food chains regarding trans fat in American foods. I described trans fat as the new “cigarette” crisis in America. My friends who are executives in the food business were not thrilled with my characterization, but I believe it is true. It is time for global corporations in the packaged food business and fast food business to wake up and smell the bad fat. This problem is not going to go away and the more the onion is peeled back the smellier the problem will get. Time to embrace change or die a slow death in the world of public opinion.

Cities across America will ban trans fat soon. The time is now for packaged food companies and fast food chains to seek help in the court of public opinion from a seasoned reputation management and crisis PR expert.
New York, Chicago and several other large and small cities are discussing banning trans fats in America today. Any corporation or lobbyist for a corporation trying to defend the continued use of trans fats in cooked and packaged foods has their head in the sand and does not understand the power of public opinion. Also remember, attorneys are NOT the experts in reputation management and crisis public relations, seasoned reputation management and crisis public relations counselors are. We get paid roughly the same amount for a reason: we are professionals, we are experts in the court of public opinion and we provide results for both the short term and the long term.

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Comment from: Cecald Evara [Visitor]

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Mar 25, 2010, 10:56 am

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