What to know about Racing Louisville's NDA with former coach Christy Holly

A non-disclosure agreement between Racing Louisville FC and fired coach Christy Holly has come under scrutiny in the wake of an investigation into misconduct in the National Women's Soccer League.

The investigation, commissioned by the U.S. Soccer Federation, laid bare for the first time complaints that led to Holly's termination, including allegations of sexual assault and harassment from former Racing defender Erin Simon.

In a report released Oct. 3, investigators wrote Racing Louisville staff did not provide documents or answer questions regarding Holly's tenure, saying a mutual NDA prohibited them from doing so.

Club executives say the NDA was intended to protect their players. But since the report's release, players and fans have questioned the club's decision to sign the agreement.

The club has declined to comment further about the NDA, saying it will fully cooperate with a second pending investigation by the NWSL and its players association.

More on Holly:Did Racing Louisville's NDA with Christy Holly protect players or enable abuse?

Here's what to know about NDAs and what's unfolded so far:

What is an NDA?

A non-disclosure agreement is a legally binding document intended to keep certain information confidential and protect a company or employer from financial loss, said Anita Moorman, a professor of sports law at the University of Louisville.

NDAs are typically used in severance agreements, preventing former employees from sharing trade secrets or other information with a company's competitors. But they've also been used to conceal sexual harassment or misconduct and keep a company's reputation intact, said Ketra Armstrong, professor of sports management and director of diversity, equity and inclusion at the University of Michigan School of Kinesiology.

More:Did Racing Louisville's NDA with Christy Holly protect players or enable abuse?

NDA laws by state and how they vary

After the #MeToo movement put a spotlight on NDAs, several states passed laws banning employers from using the contracts to prevent employees from talking about claims of workplace sexual harassment or assault.

California was the first to enact such a law in 2018, followed by 14 other states in the years since, including Illinois, Tennessee and Virginia, according to Bloomberg Law.

In March 2022, Kentucky Rep. McKenzie Cantrell of Louisville filed a proposed bill that would ban NDAs involving sexual assault or harassment, as well as workplace harassment or discrimination based on sex. But the bill was never assigned to a committee.

Timeline:How an investigation into ex-Racing Louisville coach Christy Holly played out

Why did Racing Louisville FC sign an NDA with Christy Holly?

Racing Louisville executives have said they signed a mutual non-disclosure agreement with Holly to protect the club's players and culture. The club has not made a copy of the NDA public.

According to a report from the USSF investigation, club employees declined to provide documents or answer questions regarding Holly's tenure, saying the NDA prohibited them from doing so.

As a result of the NDA, the report stated, "Holly's misconduct has remained largely unknown, including to anyone who might seek to employ him as a coach."

But in interviews after Holly was fired, now-club President James O'Connor said "no coach if he's fired for cause or terminated for cause is ever going to be related to what happens on the field."

Racing Louisville FC fans held protest signs during the Louisville City FC match against Detroit City FC at the Lynn Family Stadium in Louisville, Ky. on Oct. 5, 2022.  They were supporting the players on the Racing Louisville FC team after allegations that a former coach abused players.
Racing Louisville FC fans held protest signs during the Louisville City FC match against Detroit City FC at the Lynn Family Stadium in Louisville, Ky. on Oct. 5, 2022. They were supporting the players on the Racing Louisville FC team after allegations that a former coach abused players.

Is Racing Louisville's NDA now void?

Club executives have not directly said the NDA is void. But in a statement Oct. 5, O'Connor said Racing "will cooperate with the ongoing NWSL/NWSLPA joint investigation."

The club expanded on its statement Saturday, saying it will "provide the materials and access needed to complete the process. That includes follow up with the joint investigative team to the extent there is any contrary conclusion to the U.S. Soccer" report.

What do players think about the NDA?

Former Racing players Brooke Hendrix and Michelle Betos told The Courier Journal they now question the club's use of an NDA, saying they think managers could have publicly said Holly was accused of sexual harassment while still protecting Simon's identity.

"I think more transparency would have been good," Hendrix said. "While still protecting Erin, you can be transparent."

'Let us be the voices':Ex-Racing Louisville FC player Erin Simon thanks fans for support

Can the NWSL ban NDAs?

USSF investigators recommended the NWSL and individual teams stop using NDAs to "shield information about abusive coaches."

Moorman from the University of Louisville agreed such a policy would be beneficial, stating it would create "a sense of transparency and consistency" across the league.

"Certainly anybody who's going to hire that coach needs to be able to get an honest assessment of that behavior," she said.

Reach reporter Bailey Loosemore at bloosemore@courier-journal.com, 502-582-4646 or on Twitter @bloosemore. Support strong local journalism by subscribing today: https://www.courier-journal.com/baileyl.

This article originally appeared on Louisville Courier Journal: NWSL report: What to know about Racing Louisville, Christy Holly NDA