I’ve learned a great lesson: Everyone in your company must be honest, and if they’re not; it’s your fault and you’ll pay a price. And a report posted on the internet forced me to deal with the consequences.

Earlier this year while starting a new pay-per-click division within Northstar Ventures, it came to my attention that some of my employees used a previous pay-per-click vendor’s sales contract while waiting for our attorneys to complete our own. This plagiarized agreement was sent out to a handful of potential clients. It was the wrong thing to do and the original vendor happened across the agreement we had used.

To put it lightly, he wasn’t happy. And I would have been angry, too.

He called my cell phone and I addressed the situation immediately. Within 2 hours I uncovered the details of the situation and offered my sincere apology and took rapid action to remedy the problem. It cost one of the employees their job. This was my immediate email response to him:

“Wow. I had no knowledge of this and we will stop using that agreement immediately.

Now, let me explain how this happened:

…In the last 8 months we have hired 3 guys who just happened to have a deep background in SEO and PPC. In November, they came to me and said that they are getting several inquiries from our existing clients about SEO and PPC, and that we should offer those services since we have the expertise in-house. I gave the go-ahead and they created a little division within Northstar called Northstar Search. I paid so little attention to it, for example, that I didn’t even bother to cancel my project with you or bring it in-house, it just wasn’t a focus.

Later, they asked if they could start building a database and selling directly to other clients, which I approved. Since then, we have a very small client pool and it has not made much progress.

I never looked at any proposals or agreements, contracts or such because we have marketing or legal counsel who drafts everything for us and frankly, I just assumed that our marketing manager or controller would have taken any agreement drafting to them.

…At one point I had one of the PPC managers ask me questions about our agreement with you but I thought nothing of it at the time. Now, it is clear to me that is why he asked those questions; he made his own decision to use your proposal/agreement as our boiler-plate, and simply moved forward. I called him this morning and he verified this, he apologized profusely and said that he meant to tell me but never got around to it. Which is a lame excuse. But is also a lame excuse for me to have not watched more closely over this. (We have since completed our own document and stopped using your version many months ago.)

Les, I sincerely, sincerely apologize. The proposal will be deleted and your documents deleted immediately. I would not have approved this, there is no need to use another proposal or agreement when my team can draft something quickly.

I am very sorry, Les.

Sincerely,

Jeff”

Unfortunately for me, the vendor I was dealing with didn’t think I did enough. He did not accept my immediate apology and corrective actions. In fact, he took a harsh and vindictive approach and wrote a terribly negative and unfair “review” of me and our company on a site called “The Rip-Off Report.”

In his report, he characterized me, Northstar Ventures, and Northstar Thinktank as entirely fraudulent, dishonest, and unethical. Regardless of the real truth about me and our company, that characterization hurt.

It’s caused a certain degree of pain for us to have this report on-line. In time, the vendor recognized that he acted harshly and wrote the following update on Rip-off:

“The previous report was written after I had sent only one email to Jeff and had only given him enough time for one quick email response. In retrospect, I would like to retract some of the statements I made.

After careful consideration and communication with Jeff Chavez, he persuaded me to believe that he did not directly plagiarize my work. While he was the sole person within Northstar that received my written work, Jeff has assured me that he uploaded my proposal to his internal folder only as a reference for his internal staff. Anyone that has worked for a business with an internal, open network of staff folders knows that you’ve got to be careful what you put in there. That seems to me like an honest mistake.

An unscrupulous Northstar staff member, who still remains anonymous to me, took that proposal, which was very clearly written by an external party (my agency), and used all 9 pages of it verbatim, to pitch Northstar’s database of clients. My direct words were also used liberally on the website that Northstar built to market its new paid search management services. I would not have ever discovered this if this mystery person hadn’t accidentally copied my fax number onto the Northstar proposal as well. So I was faxed a copy of my proposal for a company that I had never heard of. I think this would make any business man very angry and just generally freaked out. That anger spewed forth in my hastily written report.

Jeff has apologized several times, expressing deep regret and has assured me that he knew absolutely nothing about the plagiarism on his company’s proposal or his company’s website. He claims to not have been involved. I have no proof or evidence, so I must take Jeff at his word. I will say that he seems like the kind of guy that wouldn’t make a rookie league mistake, such as forgetting to change the fax number of the guy you just plagiarized.

It should also be noted that under Jeff Chavez’s leadership, Northstar has worked with thousands of clients without a single negative comment being written about Northstar or himself. If you search around under Northstar; there are no on-line records of negativity. I can say the same for myself and that fact really does hold weight with me.

So this seems to have been an isolated case and a first-time occurrence. Looking back at my comments the rhetoric was unwarranted and harsh. Its actually very surprising to find that Northstar has been able to accumulate such a large client base without bringing on at least one or two naysayers.

So while the incident did happen and I have been truthful; I was mad and I hasty wrote my attack on Jeff. Blaming the sins of an organization on just one man, even the CEO, isn’t always fair. Its tough to keep tabs on such a large organization and make sure that every new hire is on the up and up. I do not regret the result of airing my grievances on this public forum. But it should be noted that my words were written when I was feeling mad, betrayed, and victimized and was blaming it all on one individual before I had all of the facts.

I still don’t have many of the facts and I don’t feel like this has been fully resolved. But I’m sure that neither of us desires any more public, on-line discussion of this situation. Let this update act as my public retraction of the prior Report.”

The update has helped, but I want to learn more from this experience.

I would greatly appreciate your comments and perspective in regard to the following questions:

First, do you think I did enough to correct this problem?

Second, do you think the vendor was too harsh?

Finally, what lessons can be learned from this?