In the early 1990s, Woody Allen was accused of sexually molesting his adopted daughter. Allen vehemently denied the allegations at the time, and he now contends that Amazon.com was aware of the allegations against him when it offered him at least $68 million to make four films for its movie distribution and streaming division. Allen filed suit against Amazon after it declined to release the first of the four films and canceled the remaining three.
Amazon decided to distance itself from Allen after the director made what he later admitted were inappropriate comments about the allegations against Harvey Weinstein. Dozens of women, including successful actresses, have accused Weinstein of acts ranging from lewd behavior to rape. These accusations gave rise to what became known as the #MeToo movement, which has prompted an increased awareness of sexual harassment both in Hollywood and society as a whole.
Allen sued Amazon for breach of contract and seeks to recover contractual damages. Amazon’s position is, in effect, that Allen’s comments hurt the profitability of the deal such that it is no longer financially viable.
Contracts with high-level executives, entertainers, and individuals with propensities for controversial behavior often include what is generally known as a morals clause. This provision allows for the termination of a contract if a party engages in certain acts that could damage a brand or reputation. These types of disputes demonstrate why it is important to seek the advice of an experienced litigation attorney early in the negotiation or dispute resolution process so as to avoid the pitfalls inherent to specialized contracts.