SB170 Summary: Alabama Non-Disparagement Obligations Act

• Establishes the Alabama Non-Disparagement Obligations Act to allow parties to create and enforce contracts prohibiting disparagement of each other or named third parties.

• Non-disparagement contracts are enforceable only through civil action when all three elements are present: contract contains explicit anti-disparagement language, an objectively injurious statement is made expected to cause harm, and the statement results in specific loss to the plaintiff.

• Requires all non-disparagement contracts to be in writing, signed by all parties, supported by adequate consideration, and include notice stating parties may not be liable for disclosures made to law enforcement, government regulators, grand juries, courts, attorneys, or in litigation (with protective orders).

• Courts may void contracts found to be overly broad, unconscionable, or unduly lacking in mutuality, and defendants may mitigate damages by proving statements were made in good faith or were retracted to eliminate harm.

• Provides remedies including injunctive relief, actual damages under breach of contract law, and attorneys' fees if contractually provided; effective the first day of the third month following passage and approval.