Lawyer Monthly - October 2021 Edition

48 WWW.LAWYER-MONTHLY.COM | OCT 2021 WHY SOCIAL MEDIA DUE DILIGENCE IS ESSENTIAL TO SPORTS SPONSORSHIP How companies can avoid a bad sponsorship deal. Besides ensuring that due diligence on social media is conducted, firms must formalise sponsorship agreements in writing, addressing all the relevant terms and conditions, thereby protecting the sponsor’s interests, providing certainty, and minimising the risk of a dispute. Given the huge implications that some incorrect wording in a contract can have, it is sensible to have a qualified sports lawyer review contracts to help mitigate any risks and ensure that agreements contain appropriate ‘morals clauses’. A morals or morality clause is a provision within a contract which holds a party to a certain behavioural standard. The purpose of a morality clause is to manage or guarantee the image of one party meets the expectations of another, and it gives sponsors the right to terminate the deal in the event that the endorser engages in conduct that might bring their brand into disrepute and negatively impact their image, goodwill and reputation. Such conduct would include attracting controversy on social media and the clause would allow sponsors to sever ties straight away to limit any reputational and financial damage. In the age of social media, however, there are challenges when it comes to enforcing a morals clause. For example, it can be difficult to measure brand diminution and to pinpoint a particular tweet or post as the cause. It can also be difficult to prove that a sportsperson did in fact write the controversial tweet or post – complicated by instances in which athletes have a third party composing their posts or otherwise overseeing their social media accounts. Another problem is that any investigation of an individual’s posts is constrained by the privacy settings applied to their account. Without explicit consent being given for their private accounts to be viewed, it is unlikely that brands will get a full picture of a person’s activity. In such instances, it can be useful to give particular attention to a subject’s ‘likes’ or ‘retweets’, as these can often provide an insight into their views and whether they are likely to be in accordance with those of the sponsor. Given all the complexities of vetting an individual’s online activity, sponsors are well advised to work with a lawyer to incorporate a specific reference to communications using social media. In conclusion. In the sports industry, sponsorship is huge business and, in general, sponsorships are seen as a mutually beneficial relationship for both sponsor and endorser. However, with the increasing recognition of social media’s importance, addressing an athlete’s activities on platforms like Twitter and Facebook in the context of his or her contractual obligations has become a necessity, and there is a very real risk of things going wrong for sponsors if they fail to do their due diligence. If brands wish to mitigate the risks of forming a partnership that could damage their reputation and revenues, the importance of carrying out social media checks and ensuring contracts are watertight cannot be overlooked. David Winnie is a senior associate and head of the Sports team at Blaser Mills Law Without explicit consent being given for their private accounts to be viewed, it is unlikely that brands will get a full picture of a person’s activity.