Morality clauses give a contracting party the right to terminate if the other party behaves badly or embarrassingly. A curious product of twentieth-century Hollywood, these contract clauses have traditionally been used to control the antics of entertainers and athletes. The current politically-sensitive historical moment, combined with the internet’s ability to broadcast widely and permanently, has put everyone’s off-duty speech, conduct, and reputation under the microscope. Media reports detailing people’s digital falls from grace abound. For fear of negative association, businesses are more attuned than ever to the extracurricular acts of their agents and associates—and are increasingly binding them to morality clauses that allow for abrupt separations.
However, morality clauses have largely escaped judicial and academic scrutiny. Perhaps due to the hefty bargaining power of their traditionally famous parties, most courts have generally found these clauses enforceable with fleeting analysis. Outside of the sports and entertainment industries, academic literature on the morality clause is scant.
We ignore morality clauses at our peril. Like non-compete clauses, which suffer from well-documented overuse and overbreadth, morality clauses can be socially harmful. Their unrestricted use allows and invites unpredictability, bad faith, and broad limitations on expression, privacy, and other liberties.
This is especially true when imposed on low-profile agents with little bargaining power.
Unlike the well-trodden area of non-competes, there is no uniform rubric for assessing whether and to what extent morality clauses are enforceable, fairly imposed, and lawfully interpreted. This Article addresses this gap, offering to courts and jurists alike a five-factor test by which to determine the validity of morality clauses in a world where reputation pervades and the line between home and office is blurred.