How much room for innovation is there in the realm of the so-called “morals clause”? A “morals clause” is a provision in a contract which stipulates that certain actions or activities undertaken in an individual’s “private life” can be grounds for termination of the contract. For entertainment lawyers, these sorts of clauses most often arise in television actor or host contracts (where a producer, broadcaster or studio may want to end their association with an individual whose reputation has become toxic) and in celebrity endorsement contracts (where a manufacturer or service provider no longer wants their product or service associated with an individual who has gained public infamy).
Morals clauses have been relevant to a few different high-profile celebrity stories in the last few years: when Charlie Sheen’s erratic behaviour threatened (and eventually ended) his tenure on the hit sitcome Two and a Half Men, the question of whether a morals clause in his contract would permit Warner Bros. Television to terminate his engagement was discussed (see Eriq Gardner’s “Morals clause at issue in Charlie Sheen legal fight”). Similarly, whether Tiger Woods’ various endorsement deals had morals clauses which were triggered by his marital infidelity was discussed in various outlets (see Morals Clauses: Tiger Woods and The Death of His Sponsorships and Will “Morals” Clauses Impact Tiger’s Endorsements?).
Drew Boortz has, as usual, an insightful post on the topic in the context of celebrity endorsements in the videogame industry: Celebrity Endorsements and Morals Clauses: What To Do When Good Deals Go Bad. As Drew points out, and as I’d like to explore a bit further, morals clauses can be drafted in a variety of different fashions and so as to impose a variety of different standards on the individual who is subject to them.
As an example, here is what might be considered the most basic form of morals clause (some of these clauses are taken from Eric Goldman’s drafting exercise):
Performer shall not, either while rendering such services to the producer or in his private life, be charged with or convicted of an offense [involving moral turpitude] under federal, state or local laws or ordinances.
That clause is extremely restricted in scope (and hence quite favourable to the performer/celebrity), since it requires an actual violation (or alleged violation rising to the level of the bringing of a criminal charge) of a law or regulation. If one were to include the “moral turpitude” language, that would make the clause even narrower, since only certain types of criminal activity would be caught by the restriction.
A morals clause can be expanded in scope by adding language which speaks to not just the commission of a crime, but the “bringing into disrepute” of the performer/celebrity and/or people or entities associated with him or her – using some language from Drew’s post, here is an example of such language:
If at any time while Artist is rendering or obligated to render on-camera services for the program hereunder, Artist is involved in any situation or occurrence which subjects Artist to public scandal, disrepute, widespread contempt, public ridicule, [or which is widely deemed by members of the general public, to embarrass, offend, insult or denigrate individuals or groups,] or that will tend to shock, insult or offend the community or public morals or decency or prejudice the Producer in general, then Producer shall have the right, in its sole discretion, to take any action it deems appropriate, including but not limited to terminating the production of the program.
That’s a relatively standard “expansive” morals clause – though I note that the portion of the clause which I have bracketed and italicized is a relatively new twist: it expands the scope of the clause to cover a situation where the performer/celebrity has made a comment (or participated in an activity) which is deemed (query how you would prove that something is “widely deemed by members of the public”) to be insulting to an individual or group. In that latter category one could imagine situations where a performer/celebrity makes comments which trade on negative stereotypes of an ethnic, religious or racial group.
These sorts of “expansive” morals clauses become a bit more difficult to police – or at least the policing of them becomes more open to interpretation, since they involve not a binary question as under the “basic” morals clause (i.e., was the person charged/convicted of a crime or not?), but a qualitative assessment of whether a particular activity or “incident” is “bad” enough that it triggers the termination right. Such debates can also involve identifying the particular “community” whose sensibilities have been shocked – are we talking about a particular sub-set of consumers, viewers in a particular geographic region or some broader set of the public? Again, how would we measure whether they have, in fact, been offended?
There are two even more expansive ways to approach morals clauses. One is to expand the clause by identifying particular infringements – I’m just going to lift this language from Drew’s post, since it so nicely illustrates the concept:
Artist shall never (a) provide services in an ‘adult-themed’ film or video program or perform onscreen services for any film or video program that is pornographic, involves nudity or graphic violence or contains material derogatory of any race, nationality, ethnic identity, gender or sexual orientation; (b) perform in any sexually explicit plays, musicals or stage shows (including strip tease acts); or (c) pose as a model for any pornographic or sexually suggestive publication; furthermore, Artist represents and warrants that Artist has never participated or been a part of any activity that would fall within the scope of (a), (b) or (c).
That’s nice and clear: you get involved in any “adult entertainment” activities, and you’re out – and we’re not going to debate whether such activities constitute a “scandal” or are “shocking”.
As Drew notes, drilling down on specific violations allows the entity engaging the performer/celebrity to tailor the contract so as to address any particular sensitivities of the engaging party or their audience (Drew mentions publicly advocating for a political position contrary to that held by the engaging party).
Finally, one could introduce what Taylor, Pinguelo and Cedrone call the “reverse-morals clause”: a clause which allows the performer/celebrity to terminate the arrangement if the company hiring them acts in a scandalous manner (see “The Reverse-Morals Clause: The Unique Way to Save Talent’s Reputation and Money in a New Era of Corporate Crimes and Scandals”). To use their illustration, if a performer/celebrity has an endorsement arrangement with a company which pulls an Enron, that performer/celebrity has an interest in preventing the company from making further use of the performer/celebrity’s name and image.
For further reading on morals clause, I suggest the following: