March 29, 2018
Partner David Fink
was quoted in the Forbes
article “The Morality Clause: How #MeToo is Changing Hollywood Dealmaking,” discussing the return of morality clauses in contracts in the wake of a string of sexual harassment claims made against celebrities and high-profile individuals.
The use of morality clauses — provisions that stipulate a party must uphold a good reputation or face termination of the agreement — is on the rise as studios and dealmakers rush to protect their investments against possible misconduct. Implementing a morality clause allows studios to cancel a contract without having to pay any further if actors do something that negatively impacts their image and diminishes the value of their services. Morality clauses are intended to protect a brand or producer from diminished value of their produce based upon bad behavior of one of their performers, but some representatives for actors feel the morality clauses are going too far.
"They could be used for the wrong purpose," said David. He believes that some would argue that morality clauses could be abused and cited the 1947 case of the Hollywood Ten, when filmmakers accused of being communist sympathizers were jailed and blacklisted from the industry. Back then, studios used morality clauses to terminate their contracts. Studios, however, point out that talent is generally well represented by sophisticated attorneys and agents, and that such clauses are necessary to protect their heavy investment on the cost of production of television and motion picture projects.
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