A Non-Disparagement or Protection of Reputation clause restricts individuals from taking any action that negatively impacts an organization, its reputation, products, services, management or employees. They are found in virtually all settlement agreements and about a quarter of executive employment agreements. Some examples briefly describe the prescribed actions; others build a thesaurus-like list of prohibited actions.
Non-Disparagement. During and after the Term, [PARTY B] will not, except in connection with a legal proceeding or Order (including a proceeding relating to this agreement) or as otherwise required by Law, criticize, ridicule, or make any statement that disparages or is derogatory of [PARTY A], or any of [PARTY A]'s members, investors, officers, directors, agents, employees, or any of its products, services, or procedures, whether or not such disparaging or derogatory statements are true.
A non-disparagement clause is not precluded or voided by the Firest Amendment right to free speech. The parties to a contract are free to waive their First Amendment rights. See, FreeLife Int’l, Inc. v. Am. Educ. Music Publications Inc., 2009 WL 3241795 (D.Ariz. 2009).
Even though the term "disparage" is vague, the courts have found the term enforcement. For example in FreeLife Int’l, Inc. v. Am. Educ. Music Publications Inc., Id, the Arizona court cited the Oxford English dictionary which defined disparage as “[t]o bring discredit or reproach upon; to dishonour, discredit; to lower in credit or esteem.” Oxford English Dictionary (2d ed. 1989). .... observes that "This rather scholarly definition seems as vague and slippery as the word itself. Nevertheless, the Court found the word to be “well defined” and “easily understood.” What the parties intended when they agreed to not disparage each other was for the jury, not the Court, to decide. 2009 WL 3241795, 6-7." What is a "Non-Disparagement" Clause and Why You May Not Want to Sign One, David Farren, Jaburg Wilk,
A large percentage of non-disparagement clauses in executive employment agreement include an exception for filing legitimate, but potentially disparaging claims with government agencies, such as the Equal Employment Opportunity Commission.