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MSU saw choice with Nassar scandal: Save image or inflate settlement

September 22, 2024
President Simon listens to victims speak during a board of trustees meeting on Dec 15, 2017 at the Hannah Administration Building. Protesters gathered to address the misconduct of MSU’s handling of the Larry Nassar investigation.
President Simon listens to victims speak during a board of trustees meeting on Dec 15, 2017 at the Hannah Administration Building. Protesters gathered to address the misconduct of MSU’s handling of the Larry Nassar investigation.

With every new, damning allegation against Michigan State University’s handling of the Larry Nassar crisis, administrators thought they faced a choice — win in the court of public opinion today or prevail in the court of law down the road.

The university’s frank, internal communications, which were released last week among thousands of Nassar-related documents, reveal a constant push and pull between the PR pros tasked with salvaging MSU’s image and the droves of lawyers hired to minimize the university’s legal exposure.

Some administrators pushed for a more forthcoming strategy: owning up to mistakes, correcting misinformation before it spread, and emphasizing the university’s desire to improve going forward. Their attorneys, however, disagreed, arguing that any concession made in the press could come back to bite them in court.

In almost every instance, the lawyers prevailed, putting potential advantages in legal proceedings above any attempt to recover the university’s embattled reputation. 

The rationale for that approach was explained at length in a memo by then-General Counsel Robert Noto. He wrote that plaintiffs’ attorneys were using the media to bait MSU into saying the wrong thing, which he feared would further the pressure on MSU to reach a settlement with survivors.

“We do not want to say something that will tip our hand or give them information they don't have or can later use,” Noto wrote. “We are also cognizant of the extreme fluidity of the situation and not anxious to say things based on present circumstances that can be thrown back at the University if the situation changes in the future.”

Noto compared it to a “fight in a ‘Rocky’ movie.”

“We are going to have to take a lot of punishment before we can dish a lot out, and most of the punches we land aren't going to cause damage which will be as visible as what results from theirs.”

The success of the strategy was dubious. MSU ended up paying a $500 million settlement to survivors, one of the largest amounts a U.S. university has paid in a sex abuse scandal.

Rachael Denhollander, the first woman to publicly accuse Nassar of sexual assault and the lead plaintiff in one of the lawsuits, said Noto’s strategy likely had the opposite effect. Had MSU apologized to survivors and listened to them about reforms, many would not have sued, she said.

“I think they could have avoided liability in the vast majority of these cases,” Denhollander said. “That was the heartbeat of survivors, that ‘I just don’t want to see this happen to anyone else.'"

“They thought only in terms of liability," she said. 

The tension between protecting MSU’s image and protecting it from a settlement emerged in the drafting of many public statements related to Nassar.

In one of the first university-wide letters addressing Nassar, some administrators wanted to say MSU would “ensure” students’ safety going forward.

General Counsel Noto suggested they instead write that "we at MSU will give the highest priority to the safety of our patients and the protection of youth who come to our campus,” records show.

When drafting a letter to then-Attorney General Bill Schuette requesting his office begin a review of MSU's handling of Nassar in January 2018, PR staff originally wrote that the university’s goal was “to answer the public's questions concerning MSU's handling of the Nassar situation.”

But the request was too close to an admission of wrongdoing for the legal team.

Outside counsel revised the statement to say an AG review “may” be needed, though the university has confidence in the litany of reviews already conducted into Nassar.

MSU’s communication team and a PR firm, Weber Shandwick, disagreed with the revisions.

“By inserting these arguments before we ask for help, we reduce the PR value,” wrote Heather Swain, then MSU’s vice president for communications and brand strategy.

But MSU’s then-board Chair, Brian Breslin, ended up approving the more defensive statement, records show.

Concerns over the “PR value” of statements also plagued MSU’s response to an April 2017 Washington Post editorial on MSU’s “willful blindness” to Nassar’s abuse, which followed the newspaper's detailed investigation into university officials’ failure to act.

In initial drafts of the university’s response, university counsel wrote that the editorial was drawing “conclusions based on allegations by plaintiffs in lawsuits, many of which have not yet been served on, what's more answered by, the University, or upon the incomplete picture provided by the documents thus far released by MSU through the Freedom of Information Act process.”

There was immediate pushback from MSU’s communications team, arguing the statement was overly legal and didn’t express any sympathy for survivors.

MSU leadership needed to understand that “a reasonable person could easily come to the same conclusion that the editorial did” after reading The Post’s “100% accurate” initial investigatory piece, then-spokesperson Jason Cody wrote. The statement needed to be infused with “apology and empathy,” or not sent at all, he said.

Lawyers also clashed with board members.

In 2018, Noto and former Trustee Melanie Foster disagreed over whether or not to pull indemnification for William Strampel, the former dean of the College of Osteopathic Medicine.

Strampel had recently been handed dismissal charges by MSU for violating the university’s sexual misconduct policy. Months later, Strampel would be arraigned on federal charges of sexual misconduct and willful neglect of duty.

While it's common practice for institutions to cover legal expenses for staff who are facing litigation, the institution can revoke that protection if the person refuses to cooperate with the legal proceedings.

Foster argued that Strampel’s expressed intention to fight the dismissal charges the university had handed him provided sufficient grounds to pull his indemnification.

But Noto disagreed, saying indemnification can’t be pulled for the sole reason that Strampel refused to cooperate with the university’s request for his dismissal.

Noto conceded that Strampel was an “embarrassment” and had indeed refused to cooperate with the university’s request for his dismissal, but said that wasn’t enough to legally justify pulling indemnification.

“If he sued us for his defense and indemnity costs after we pulled them (and he likely would now that he has lawyered up), he’d probably win.”

In at least one case, MSU’s legal caution went so far as to stop administrators from correcting a rapidly spreading, damning story they believed to be untrue.

In January 2018, a Nassar survivor testified in court that her family was still being billed for appointments she had with Nassar.

The story generated the most media attention of any development throughout the entire Nassar saga up to that point, then-communications director Kent Cassella said.

Cassella recommended the university act swiftly in response, and “make a blanket decision to stop billing all Nassar patients immediately.”

But shortly after, then-CEO of the MSU HealthTeam Michael Herbert notified the communications team that the subject of the media report did indeed have an outstanding payment — but just not with Nassar.

Instead, Herbert said, the appointment was with another physician, Jeffrey Kovan.

The university moved the same day to cancel the outstanding bill in response to public pressure, but declined to contest the truthfulness of the media report — a decision that drew the ire of Trustee Dianne Byrum.

“We should correct the information in the press if the person did not see Nassar,” she wrote. “We should pivot to more offense, correct all misinformation and leave no attack unanswered.”

The reasons then-communications director Jason Cody gave for not correcting what the university believed to be an inaccuracy were two-fold.

“I don’t like the idea of any of us having access to medical records. Or calling out a teenage victim.”

Heather Swain cited the Health Insurance Portability and Accountability Act, a law that protects the privacy of health information, as a legal obstacle to giving the media information about the person’s health records and asking them to run a correction accordingly.

In some cases, after all the tweaking and fighting, MSU’s spokespeople wondered if any statement could save them. Or, if the university’s actions were simply indefensible.

“Since you lawyers wouldn’t do the right thing … there ain’t crap the media folks can do for you,” Cody wrote in a text message to Cassella, expressing frustrations about the university’s decision not to fire MSU doctor Brooke Lemmen, who at the time was accused of removing patient files at Nassar’s request.

“...and klages, and Strample, and training, and outreach, and … 😉” Cassella quipped back, referencing other areas where the PR professionals found it difficult to defend the university’s actions.

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