Public relations agencies find tough going in disaster niche.

WHEN nearly 40 people fell ill from suspected E. coli exposure from eating at Pat & Oscar's restaurants in 2003, the restaurant chain's owners did more than apologize.

They quickly severed ties with the supplier of the allegedly tainted lettuce. They set up a toll-free phone number for patrons who feared poisoning. And over the course of a weekend, they gave out more than $500,000 in free food to lure skittish customers back.

Worldwide Restaurant Concepts Inc., the Sherman Oaks-based owner of Pat & Oscar's, didn't come up with those ideas on its own. It turned to one of a growing number of crisis-management specialists in Southern California: Pasadena-based Lexicon Communications Corp.

While the E. coli scare caused same-store sales at Pat & Oscar's to drop 13.6 percent last year, the strategies at least stemmed what could have been potentially fatal damage.

With fewer than l0 employees, Lexicon occupies a growing niche within the public-relations industry: helping companies defuse potential crises.

"There's always been steady growth in this field," said Steven Fink, president of Lexicon, which was founded in 1983. "What's driving the growth now is that CEOs are seeing other companies' mistakes and realize they don't want to repeat them."

As a field, modern crisis management dates back to the early 1980s, when Johnson & Johnson had to handle the nightmarish Tylenol episode, in which capsules of the popular product had been laced with cyanide. Seven people were killed. Since then, crisis-management specialists have become an accepted part of the public relations field.

It's impossible to gauge the number of crisis-management specialists since the field covers a range of practitioners--from those working for major PR firms to small shops that specialize in certain areas.

Becoming a buzzword 

Fees vary greatly, but crisis-management specialists typically charge about 30 percent more than other public relations consultants. Some small boutique firms charge as little as $200 an hour, while the rate at larger practices can reach $600 an hour.

Sitrick and Co. is the largest locally based crisis-management firm, best known for its roster of celebrity clients who have included rapper Eminem and actress Halle Berry. The firm also deals in energy regulation, investor relations and trademark cases.

Allan Mayer, president of Sitrick and Co., said many firms are marketing themselves as crisis managers despite limited experience in the area.

"Seven or eight years ago when I told someone I was a crisis management specialist, they would think I was a psychotherapist of some kind or someone helping people through marital problems or something like that," Mayer said. "Unfortunately, now it's become some kind of buzzword. Every firm now, big and small, likes to pretend it has the ability to do crisis work."

Some smaller firms specialize in crisis management, while others combine it with other specialties.

Dana Valenzuela, who heads the two-person Velvet Communications in Pasadena, admits that she would be in no position to manage a crisis like the Exxon Valdez spill. But the firm, which specializes in food and fashion, is equipped to help clients deal with bad reviews and sluggish clothing orders. "A crisis means something different in every field," Valenzuela said.

Jonathan Bernstein, owner of Bernstein Crisis Management LLC in Monrovia, said he's seeing an upswing in the number of companies inquiring about crisis-prevention services--perhaps the result of high-profile cases like Enron that alerted executives to the danger of a crisis that is too large to contain.

Bernstein conducts seminars with his business clients in which he identifies potential crises, such as breaches in the computer system, complaints about employment discrimination and customer complaints lodged with the Better Business Bureau.

"There are a lot of people who know what to do when the fire is burning," he said. "There are fewer people who know how to prevent the fire from burning."

The shift toward crisis prevention comes as crisis specialists jockeys for a relatively stagnant amount of work. The field boomed during the Y2K computer scare and in the aftermath of the 2001 terrorist attacks, as well as the accounting scandals that besmirched many corporations.

But business has leveled off since then, said Michael Terpin, president of Terpin Communications Group, a Venice firm specializing in high technology. "It's less necessary in terms of actual communications than one or two or three years ago when companies were melting down left and right," he said.