Weinstein Clauses: Best Practices for Negotiating, Drafting and Responding

In the wake of the #MeToo movement, it is increasingly common in corporate transactional documents to see buyers and related parties include so-called “Weinstein” clauses. Such provisions typically request that a target company represent and warrant whether its officers or executives have been the subject of allegations of sexual harassment or misconduct, and if the company has entered into any settlement agreements regarding these kinds of claims.

The purpose of a Weinstein clause is to provide assurance that the target company (including its officers and executives) is not a hotbed of sexual harassment or a ticking time bomb of claims waiting to explode, which would no doubt result in liability, embarrassment and potential loss of value for the acquiring parties. This primer on drafting and negotiating Weinstein clauses should help deal teams balance these risks.