Refinery A106 pipe failure and consultant study

Tom's backward reference to a case from prior session: refinery found one leaking pipe out of 600, manager ordered all 600 ripped out and sued contractor, turning a ~$100K inspection problem into a $60M lawsuit. Used in parallel with 60 Wall Street to illustrate "rip-it-all-out" manager pathology.

This type of fight comes up — I end up getting involved in one about twice a year. The oil-company case I mentioned, with the 600 lengths of pipe: they found one leaking pipe out of 600, and they decided to rip out everything they had already put into their refinery. A three-or-four-million-dollar issue, which could have been solved by a hundred thousand dollars' worth of inspection, turned into a sixty-million-dollar lawsuit, because someone said rip it all out. A lot of times you get a manager who thinks, I'm going to get the other guy to pay for it, so I'm not going to take any risk on myself — I'm just going to rip it out and sue them for the difference. Well, it doesn't work, folks, because the other people will decide you had to be reasonable about what you decided to do. But that's why the codes triple in size. That's why the people who sell the codes, the for-profit people, have decided this is a gold mine.