Search Site
Menu
​6700 Koll Center Parkway, Suite 330 | Pleasanton, California 94566
Call For Consultation 925-468-0400
The Weinstein Clauses

Have you been contemplating a merger and/or acquisition? If so, you may want to include “Weinstein Clauses” in the purchase and sale agreements. Such clauses require the target company, and/or its equity owners, to represent that, within a specific time period, no sexual harassment or assault allegations have been made against the company’s officers or senior employees, and that the target company has not entered into any settlement agreements with regard to such behavior.

WHY INCLUDE THEM?

  • The direct economic consequences of these claims can be massive, and it is in your best interest to avoid the costs associated with defending, litigating and resolving sexual harassment or assault allegations against your company’s officers or senior employees.
  • To protect your company from reputational harm associated with prior sexual harassment or assault allegations engaged in by a target company’s employees.

If you decide to include “Weinstein Clauses” in such agreements, you will likely want to subject a portion of deal proceeds to escrow or holdback, in case representation by the target company is found to be false. Essentially, the “Weinstein Clauses” shift the liability of bad actors from the buyer to the seller.

And just in case you are wondering, “Weinstein Clauses” are named after well known and successful Hollywood producer Harvey Weinstein. In late 2017, he was the subject of a New York Times expose article that detailed decades of sexual harassment, unwanted sexual contact, and other sexual misconduct. It was revealed that Weinstein had entered into settlements with at least eight women and, later, as many as 80 women came forward to accuse Weinstein and various other famous Hollywood stars. Due to this scandal, all of Weinstein’s companies ceased doing business and various business partnerships were severed. This became the start of the #MeToo Movement, which later created the rise of “Weinstein Clauses.”

If you would like more information on this or need assistance in reviewing or drafting “Weinstein Clauses” pertaining to a merger and/or acquisition you are contemplating, please contact attorney Melinda Garcia, Esq., of Garcia & Gurney, ALC at 925-468-0400.

 

The information contained in this article is provided by Garcia & Gurney, ALC (“G&G”) and is provided for educational and informational purposes only and should not be construed as legal advice or an offer to perform services on any subject matter. Recipients of this article should not act or refrain from acting on the basis of any information included in this article without seeking appropriate legal advice on the particular facts and circumstances at issue from an attorney licensed in the recipient’s state. G&G expressly disclaims all liability with respect to actions taken or not taken by the recipient based on any or all of the information or other contents in this article. This article not intended to constitute an advertisement for professional services or any other services. Nothing herein is intended to create an attorney-client relationship and shall not be construed as legal advice.

Contact us

Please fill out the form below and one of our attorneys will contact you.

Quick Contact Form

Awards/Affiliations
Client Testimonials
  • "Melinda Garcia came very highly recommended by two colleagues who raved about her expertise and assertiveness. She and her team are extremely responsive and help us navigate the legal challenges of our consulting business. We're thrilled to have Melinda on our side!"

  • "Melinda Garcia was wonderful to work with. She is an outstanding listener and has a great memory for details and personal information.... which makes one feel very comfortable and welcome. I would highly recommend her to anyone not only because of her outstanding abilities but because of the compassion she eludes in dealing with an individual's issues/concerns."

  • "Highly recommend! I was in need of urgent help with an employment matter and Melinda Garcia came through for me the same day. She fit me in for a consultation within hours of my call and read my documents prior to our meeting. She was thorough, attentive to my needs, knowledgeable, professional and above all very comforting."

  • "Melinda Garcia provided me excellent advice in resolving an employment agreement related to an acquisition of the company I worked for. She is very knowledgeable, asked me what I wanted to achieve with her services, provided excellent service to achieve those goals, and was very cognizant of fees. I recommend her for employment related services."

  • "Melinda Garcia provided excellent guidance with an employment/compensation case. Her knowledge of employment law, and strong negotiation skills, brought the case to a successful conclusion."

  • "Melinda Garcia has done an excellent job assisting us as we established our small business. From incorporation to contract negotiations, Melinda Garcia and her staff were outstanding"