One of the skills required of public company executives is the ability to hold up their end at quarterly earnings broadcasts. Following prepared statements, the execs answer questions from an audience usually composed of analysts, bankers and media people. Today's business leaders know the risks and are prudent in their comments, but the broadcasts remain something of a high-wire act. Say the wrong thing, and it will be reported around the world within minutes. But presentations are routine to most of them; trouble rarely brews.
Written statements issued by companies present fewer opportunities for gaffes. Staff will have picked over every last word. Beyond the main point being revealed, press releases rarely contain much to ruffle the feathers.
So it's odd that both live broadcasts and written documents are always accompanied by lengthy disclaimers, often longer than the releases they accompany. This is "safe harbor" language under the Private Securities Litigation Reform Act of 1995, using boilerplate words that explain why the statements they accompany may be hot air. The underlying message is that every word should be taken with a grain of salt, in a legal sense.
Until now, magazine writers have been held to a higher standard. When we say something, we have to mean it. In the interests of protecting my fellow columnists, however, I now offer safe harbor language for writers. This is a timely idea, one that actually anticipates the litigation risk that writers carry. Because we are paid by the word, if these paragraphs accompany every article written, we will soon be wealthy enough to be sued, and then we'll need safe harbor provisions. In advance of that need, here is an example:
This article may contain "forward-looking statements" within the meaning of the U.S. federal securities laws. All such statements rely on assumptions concerning future events and are subject to uncertainties and other factors, many of which are outside the writer's control, that could cause actual outcomes to differ materially from such prognostications.
In particular, statements using words such as "may," "might," "could be," "possibly," "I dunno" and "huh?" or similar words may, or might, involve forward-looking statements.
Events and uncertainties that could cause the actual outcomes to differ include, but are not necessarily limited to: ignorance on the part of the Web site the writer stole the words from; stupidity on the part of anyone the writer may, or may not, have interviewed; the weather; the writer's biorhythms; the performance of his football team that weekend; the closeness of the deadline when he finally got round to writing; sunspots; the appearance in town of King Kong; the availability of tranquilizers; the sudden reappearance of an old girlfriend who will later go on to dump the writer by e-mail; and/or accidental canine ingestion of finished work or the writer's research.
The writer may, or may not, be an escaped lunatic, a son of a gun, drunk, feebleminded, smoking crack, a name at Lloyd's, in touch with visitors from another world, a groovy cat, someone who knows what "a groovy cat" may, or may not, be, or will be, or whatever. What-ever.
The writer may have picked up information from other writers, blogs or porn Web sites, psychics, bathroom walls, cereal boxes, revival meetings or other sources.
The reader may, or may not, be, but probably is, drunk, wearing bad spectacles, vaguely disaffected, a cuckold, an insurance salesman, French or all of the above.
Finally, the writer is broke, so suing would be a complete waste of time.
ROGER CROMBIE, a writer, editor and former accountant, is a regular columnist for
Risk & Insurance®. He also covers issues on alternative risk for this magazine.
April 1, 2006
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