High-profile scandals in the sports world, exemplified by Lance Armstrong and Tiger Woods, expose endorsement companies to financial and reputational risks. Endorsement contracts today rely on morality clauses to mitigate this risk of exposure, which unduly restricts a company’s response to an athlete’s misconduct. Clawback clauses, on the other hand, provide companies with a mechanism to fully protect their investment in the employee or sponsored athlete. This Note discusses the practicality of introducing clawback clauses into athletic endorsement contracts. Although many factors inhibit endorsement companies from implementing clawback clauses into endorsement contracts, more beneficial alternatives exist that companies can pursue to better protect themselves rather than relying solely on morality clauses. This Note argues that the most practical alternative to the morality clause includes adopting specific contracting techniques in contrast to the untried clawback provision.
Entertainment, Arts, and Sports Law
- Journal title
Boston College Law Review
- Date submitted
8 September 2022