The Week in PR

1. No Love: Luxury brands Porsche and TAG Heuer distanced themselves from spokesperson Maria Sharapova faster than a cross-court smash after the five-time Grand Slam champion announced she’d failed a drug test. Admitting full responsibility, the tennis star said she’d been taking meldonium for 10 years under a doctor’s orders. Meldonium was placed on the World Anti-Doping Agency’s proscribed list Jan 1. Porsche put its relationship with the Russian on hold; ditto Nike days earlier. TAG Heuer decided against renewing her contract. [ Also see Image Patrol, page 1. ]The lessons for brand communicators begin with including a broad morals clause in agreements with celebrity endorsers, says attorney Allison Fitzpatrick, partner at Davis & Gilbert in the marketing, promotions and PR practice groups. Ditto with paid influencers. A morals clause gives a brand the right to end the agreement and avoid paying the celebrity if he or she does anything that tarnishes the brand. You’re unlikely to be able to include a morals clause with A-list celebs, she admits. In that case include language where the brand can pay the celeb to get out of the contract. “There’s a hierarchy,” she says, noting it’s easier to get B- and C-list celebs to agree to a morals clause. Another lesson: Brands need to vet celebs prior to signing contracts, she advises. In addition to background checks, Fitzpatrick says, “Check their Facebook pages, YouTube and Twitter accounts, they’re public sources.” Besides looking for bad behavior, brands also need to make sure their future spokesman isn’t a fan of a competitor, she says. Fitzpatrick is surprised how quickly brands fled Sharapova considering the tennis star’s full apology. “It makes you think there might be something else there.”
2. Fed Feeding Frenzy for VW: The naive among us like to think justice and safety are the chief motivators for federal regulators. We’re likely wrong. It seems the feds smell diesel, er, blood in the Potomac. The prosecution against Volkswagen “has become a competition among enforcers and you’re now getting a free-for-all without much coordination,” Columbia University law professor John Coffee tells The Wall St Journal. “Everybody would like a little credit for doing something to” VW, he adds. Indeed, the Justice Dept. just issued a subpoena under the Financial Institutions Reform, Recover and Enforcement Act (Firrea), The Journal reports. Conceived to combat bank fraud, Firrea will allow prosecutors to root into VW’s activities going back 10 years. It also lets civil and criminal prosecutors share information. This is believed to be the first time Firrea will be used to prosecute non-monetary crimes. VW faces $18 billion+ in fines and penalties from a Justice Dept suit filed in Jan.In an indirectly related story, VW’s U.S. chief Michael Horn left the company last week in what was called a mutual parting. You may recall Horn admitting just days after the diesel scandal broke in September, “Our company was dishonest; we screwed up.” Perhaps his transparency hurt him in Germany, where VW leaders were far slower to speak to the media, much less admit guilt. You may also recall the name Alan Brown, the VW dealer from TX who heads the U.S. dealer advisory group ( PRN, Jan 4). At the time, Brown was upset with VW’s lack of communication with dealers. With the departure of Horn, who was beloved by dealers for his honesty, Brown is quoted as saying VW’s relationship with U.S. dealers is “hanging by a thread.”
3. News Bits: PR pros should keep an eye on the suit several PR firms brought last week against the NY State Joint Commission on Public Ethics (JCOPE) regulation of Jan 26 that classifies some PR activities as lobbying, says attorney Michael Lasky of Davis & Gilbert ( PRN, Feb 1). “The regulation is germane to both in-house and agency PR pros” and one need not be in N.Y. to run afoul of it, he says. The suit seeks emergency relief from the regulation. It’s been sent to a judge with a request for prompt adjudication. PRSA, the Arthur W. Page Society and the PR Council filed affidavits last week to stay enforcement of the regulation. Lasky says the regulation equating PR activities with lobbying so “flies in the face of established principles of free speech under the First Amendment.” – A Chipotle near Boston closed voluntarily Tuesday after an employee tested positive for norovirus. It reopened Thursday. Supporters said the shutdown shows Chipotle’s new food safety regime works. Detractors say it’s yet another black mark for the brand.

4. 

   People: Newlink named former Saatchi & Saatchi Latin America president Cynthia McFarlane its chief strategy officer and managing partner. – The PR Council named Sara Ghazaii VP, director of communications. She joins from the New York Genome Center. – Rogers & Cowan said Danielle Thur has joined its NY office as VP from EFG PR. – Joe Browne, the NFL’s senior advisor to the commissioner, was named to FleishmanHillard’s International Advisory Board.

This article originally appeared in the March 14, 2016 issue of PR News. Read more subscriber-only content by becoming a PR News subscriber today.