As we approach the one-year anniversary of #MeToo, the falling dominoes dominate boardrooms, management meetings and litigation lore. The global grasp of  the #MeToo movement cannot be understated. Within the first month alone, the moniker was already translated into 33 languages and, by the beginning of 2018, reached more than 85 countries. While it may be too early to assess the impact on any increase on Title VII (or the state equivalent) lawsuits, the other avenues for litigation have taken off. The financial implications for organizations caught in the ire of sexual misconduct is swift and severe.

Litigation Landscape

• Title VII and the EEOC

The expanse of the movement left laypeople expecting an immediate surge of federal litigation in the area of sexual harassment and discrimination. However, due to the applicable statutes of limitations, the litigation numbers with regard to Title VII litigation would not yet be representative. While the Equal Employment Opportunities Commission (EEOC) officials report that website traffic has tripled since autumn 2017, the agency has not seen an onslaught of new filings according to acting chair of the Equal Employment Opportunity Commission (EEOC), Victoria Lipnic. Pursuant to federal law, would-be plaintiffs have 300 days to file a complaint (the statistics for state equivalent statutes to Title VII are not widely retained). Thus, it will likely take some time for the influx of claims to start matching the degree of public discourse. However, the commission is seeing a directly correlative increase in other areas. For example, Lipnic has said that requests for workplace trainings have increased dramatically. Based upon the attention #MeToo is getting and the significant financial losses experienced by some organizations, it is not surprising that they are attempting to stave off claims through such trainings.

• Shareholder Litigation

While Title VII litigation may just be getting off the ground, shareholder litigation, based upon the economic losses sustained by organizations rife with sexual misconduct, has exploded. From Wynn to 21^st Century Fox to LaCroix water, it's not just the bad actors that are being held accountable. Rather, corporate boards who contributed to the permissive culture, under the guise of business, are being held accountable by shareholders. In July, a securities class action was filed against National Beverage Corp. (the manufacturer of LaCroix flavored mineral water) for ongoing revelations of sexual misconduct in the C Suite. Similarly, Steve Wynn, chairman and CEO of Wynn Resorts has been accused of forcing women to have sex or perform sexual acts without their consent. The Wynn Resorts shareholder derivative lawsuit filed in February of this year alleges that Wynn executives and board members knew about the sexual misconduct and coercion, but failed to act or even investigate.

Mass media corporation 21^st Century Fox agreed to pay a $90 million-dollar settlement in what is one of the largest shareholder derivative settlements in history based upon the permissive culture including sexual and racial harassment and impropriety. The lawsuit asserted six claims including breach of fiduciary duty, unjust enrichment and others. The lawsuit focused on the mismanagement and toxic work culture that led to attrition and reputational damage to the organization.

Beyond the headlines, delirious dollar amounts and outrage that the salacious sexual misconduct inures, the root causes and practical mitigation strategies often go unaddressed. It's crucial to look beyond the Band-Aids and headlines and assess why organizations are vulnerable and how they can mitigate risk.

Root Causes of Systemic Organizational Impropriety

• Permissive Culture

Cultural groundswell is the only trigger to the #MeToo dominoes falling. There was no change legally, judicially or hierarchically last fall. Permissive workplace culture allowed the plague of perpetual sexual impropriety to linger. For organizations to avoid systemic or widespread sexual misconduct or harassment, management needs to foster a culture where poor behaviors are not acceptable. Usually, organizations rife with impropriety tolerate other poor behaviors that contribute to cynicism among the workforce. Foul language, demeaning humor, racial intolerance and workplace chaos permeate workplace culture and will lead to a toxic work environment wherein employees are disenchanted and are unlikely to be the canaries in the coal mine or good Samaritans an organization relies upon to stem the bleeding before the systemic stain of sexual impropriety sets in.

• Hierarchy in Name Only

Michigan State and Penn State are great examples of the dangers of an organization that operates on a power structure that differs from the published organizational chart.

The half billion-dollar settlement for the victims of Larry Nassar, a Michigan State University physician who molested athletes under the pretense of medical treatment, isn't the only shocking takeaway from the case. This scenario left many wondering how university leadership, the U.S. Olympic Committee and USA Gymnastics never intervened on behalf of the hundreds of women and men that were being abused. Because Nassar was the famed Olympic trainer, viewed side-by-side with Olympic champions for decades, he was beyond reproach. Numerous women allege that their complaints to the university fell on deaf ears. Clearly the stated hierarchy and reporting structure at the university, USA Gymnastics and at the Olympics committee level did not reflect the power that this one man held in these organizations.

While the Penn State settlement and convictions pale in comparison to the Michigan State settlement and 100-year prison sentence, the same hierarchical issue festered. Because the Penn State athletic director and president were the stated leaders of the organizations, but instead abdicated their duties over the course of decades to Joe Paterno, there were criminal convictions up and down the chain of command based upon the institutional failures. Thus, employers must realize the importance of organizational structure and the impact it has on their ability to prevent and respond to issues of sexual harassment and other improprieties. These molestation horrors exemplify how unstated organizational dynamics only lead to further liability when there are sacred cows in an organization.

• Sacred Cows

The Wynn, Weinstein and university officials exemplify the dangers of the sacred cow. Star performers, who are often beyond reproach, will trade on their internal capital to victimize those with less clout. Weinstein has more than 100 accusers and law enforcement across the globe tracking his financial, criminal and workplace misdeeds because of his ability to flout rules and trade on his personal brand to victimize women. While these organizations no doubt invested and over empowered these superstars to act beyond reproach based upon their perceived need for the talent, the price tag for such permissiveness has been steep financially. The costs that will never be monetized, however, are losses such as lost opportunity, attrition and reputational harm.

Organizations must endeavor to prevent the peril heaped upon companies rife with misconduct, as the consequences do not lay alone at the feet of the wrongdoers. Beyond the victims and abusers lay most of the workforce and the shareholders who bear the fiscal brunt of management morass.

Dove A.E. Burns, a partner at Obermayer Rebbman Maxwell & Hippel, focuses her practice on employment law and professional liability. She has experience defending corporate clients and executives, professional service providers, multibillion-dollar companies, nonprofits, and boards of directors in a variety of high-exposure matters.