The Ethics of Standards

Here’s another hypothetical for you: Let’s suppose that you have gained a national or international reputation because of your success with whatever it is you do (doesn’t matter what) and you decide to cash in on that public image by creating something (doesn’t matter what) and putting your name on it. Let’s also suppose that after a while you get bored with the venture and sell it to some investors, but as part of the purchase price you agree to let them keep your name on the property, because without that brand identity it will be much harder to sell. Now let’s suppose that after a few years go by the new owners have let the venture (whatever it is) run down to the point where you are no longer willing to have your name on it; the property is now so low quality that you feel it will hurt your reputation to be associated with it. Do you have the right to demand that they take your name off of the property?

If you didn’t catch it on the news I should probably just tell you that this is more or less what happened to Donald Trump this past week. Although Mr. Trump no longer owns two of the Atlantic City casinos that bear his name (he sold 90% interest in each to an investment group), they are still called the Trump Plaza and the Trump Taj Mahal, and at least part of their brand identity is a holdover from the days when Trump was building the biggest, gaudiest and most expensive everything in the world and slapping his name on the front. Unfortunately, Mr. Trump and his advisors now believe that these two properties are not being properly maintained, and have now decayed to the point where he is no longer willing to have his name on them. He is therefore filing a lawsuit to force the current owner to change the names of these facilities…

Now, I would be the first to admit that it isn’t easy to feel sorry for Donald Trump, or for anyone who has enough money to buy a hotel/casino from him in the first place. But the story does raise a serious point, even for those of us who aren’t billionaire reality-television star real estate developers. Assuming that you have licensed someone to make use of your name, and by extension your reputation or public image, at what point do you have the right to demand that they either conform to a standard that you would find acceptable (at least) or else stop using it? Or, to look at it from the other side of the desk, if you have purchased the right to use someone’s name, likeness or reputation in order to help sell your product, how much responsibility do you have to maintain quality at a level that won’t damage the reputation to which you have purchased the rights?

We should probably also acknowledge that if someone had purchased a license to use a celebrity’s name or likeness and that celebrity began acting in an embarrassing or repugnant way, no one would question the business owner’s wanting to drop the celebrity association, and a lawsuit to recover whatever fees were paid would not be considered inappropriate (although it might or might not succeed). But does the business have a corresponding responsibility to the celebrity? Does our answer change if the celebrity is a more sympathetic figure than Donald Trump, or if it is clear that the shoddy product or service really is threatening his or her livelihood?

No one is going to argue that any business should not comply with the terms of the contract it signed, or that a celebrity who is being paid for the use of his or her good name shouldn’t insist on a clause in the contract guaranteeing them the right to rescind use of that name in the event the business is damaging it. But assuming that no material breach has occurred, and that the celebrity has no such escape clause, does the business have any ethical responsibility to comply with such a demand? For that matter, does the celebrity have an ethical responsibility to let the business get whatever benefit they can from the use of his or her endorsement, assuming they were paid for it in the first place?

It’s worth thinking about…