SBD/April 24, 2012/Marketing and Sponsorship

Ruling In Mendenhall-Hanesbrands Suit Could Impact How Tweets Are Covered In Contracts

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Judge has denied Hanesbrands' attempt to escape lawsuit filed by Mendenhall
The lesson in a recent court decision involving Steelers RB Rashard Mendenhall is that morals clauses are “everywhere in Hollywood talent contracts, but the standard contractual language might be too broad to stop a celebrity from being polemical on Twitter,” according to Eriq Gardner of the HOLLYWOOD REPORTER. Mendenhall sued Hanesbrands for “terminating his million-dollar contract to promote Champion sportswear.” Champion “ditched Mendenhall after he sent eyebrow-raising tweets on sociopolitical topics, including an attempt to temper celebration after Osama bin Laden was killed” last May. A judge has “denied Hanesbrands' attempt to escape the lawsuit, saying that Mendenhall alleged a plausible claim for breach of contract.” Gardner wrote Hanesbrands had “a pretty standard morals clause with Mendenhall that prevented the NFL star from making actions that would bring him ‘into public disrepute, contempt, scandal or ridicule, or tending to shock, insult or offend a majority of the consuming public.’" But before the company “exercised its rights to terminate the endorser's contract, it had certain obligations.” The judge noted that Mendenhall’s deal “could only be terminated based on Mendenhall becoming involved in an act that brought him ‘into public dispute ...’ and that ‘mere disagreement with Mr. Mendenhall’s comments would not have triggered Hanesbrands’ termination rights.’" Hanesbrands argued that the "public backlash was enough to trigger termination under its morals clause, but the judge says it's too early and the facts aren't complete to analyze news reports on Mendenhall's controversial tweets or how the public reacted.” The case now moves to “a question that could set precedent in many lawsuits: How do you measure what's offensive to an audience on Twitter and beyond?” (HOLLYWOODREPORTER.com, 4/23).
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