A morals clause (or “bad boy” or “bad girl” clause) is a provision in a contract which proscribes certain behavior of an individual to that contract. A morals clause is different from, and usually covers other wrongdoing beyond, a moral turpitude clause which allows a party to terminate a contract for cause if the other party is convicted of, confesses to, or enters a guilty or nolo contendere plea concerning a crime involving depravity.
Morals clauses are often employed in endorsement contracts. Lance Armstrong and Tiger Woods come readily to mind. It is no longer enough to state that a company can terminate the contract for any “action involving moral turpitude.” Morals clauses should be drafted broadly to cover any situation or occurrence including, but not limited to, the use of drugs or alcohol, sexual harassment or assault, or otherwise tending to bring the party into public disrepute, contempt, scandal or ridicule, which may embarrass, offend, insult or denigrate individuals or groups, or that my shock, insult or offend the public.
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