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Avoiding the Trump Effect in Your Creative Contracts

Added on by Gamal Hennessy.

By Gamal Hennessy 

National politics has been obsessed with Donald Trump since he announced his bid for the presidency. Whether you agree with him or not, his brand of political discourse creates an “us vs. them” mentality the media can’t resist. When he talks, people often react in extreme ways.

Many businesses reacted by terminating their contracts with Trump and his companies. After his now infamous quotes about Mexicans, Chinese and immigrants in general, NBC cut him from The Apprentice. Celebrities dropped out of his beauty pageant. High profile chefs refused to build new restaurants on his properties (See Trump Litigations Pose Questions for Restauranteurs). Trump responded by suing everyone who tries to distance themselves from his comments. While the Trump show has moved on to other acts in its political circus, I’d like to take a look at things creatives should consider when dealing with public image in their contracts

The Impact of Reputation on Business

Even before the rise of social media, the image of a person or company could be the difference between the success and failure of an entertainment release. Associating a new sneaker or film with a star could guarantee millions of dollars in sales. An arrest or scandal at the wrong time could destroy a franchise or an entire company. In the world of Twitter, Facebook and Instagram the same rules are applied with the speed of thought. No one is immune from the critical eye of public scrutiny. The most modest and low budget film, graphic novel or musical release needs to have some kind of escape route if one party pulls a Trump.

Types of Contract Protections

Contract law deals with damaged reputations in four distinct ways. The first two come into play more often in media employment and endorsement contracts, and the last two are more universal ideas. Each of them could deal with a Trump in a different way, with different levels of effectiveness.

  • The Morals Clause prohibits a party from engaging in certain behavior in that party’s private life. For example, an actor for G-rated family films might have a morals clause in their contract making arrests for DUI, drug use, solicitation of prostitutes or other scandals grounds for terminating the deal.
  • The Non Disparagement Clause prohibits a party from discrediting, dishonoring or lowering the esteem of the other party. So if a writer sells her book to a movie studio, a non-disparagement clause might prevent her from going to the press and criticizing the movie or the studio
  • The Confidentiality Clause could prohibit any public discussion of any aspect of the agreement. In some cases, a party might not even be allowed to discuss the existence of the agreement itself. We sometimes see this when actors are put under a gag order to limit leaks for an upcoming release.
  • The At Will Termination Clause is the broadest type of termination clause. It gives a party the right to walk away without giving any specific reason for termination. It often doesn’t allow for a cure period (where whoever is at fault gets the chance to fix things) and creates the most precarious type of contract.

It is unclear which if any of these clauses were in the restaurant or beauty pageant contracts, or how the cases against Trump will play out. It is clear that as more creatives and corporate executives get treated as public figures, the more these clauses will come into play for future deals.

Finding the Protection

When a creative person looks at a contract, the focus is often on the money, the deliverables, and the deadlines. They might not be willing to slog through the swamps of boilerplate language to consider the impact of confidentiality or morals clauses. Without professional advice, they might do or say something to put their deal at risk even after it’s signed. Or they might find themselves publicly connected to a media nightmare. In the modern digital landscape, it pays to have a professional review all the aspects of your deal to point out pitfalls unrelated to dollars or deadlines (See Why Artists Need Lawyers). Not all of us can be Donald Trump and say whatever we want. Over time, we might find out he can’t do it either.

Have fun.


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