Nice way to tell MIL her husband can't be near my baby

Andie
So my husband's mom and dad are divorced and she remarried about a year ago. Her new husband is a CREEP. Everyone in the family dislikes him and tried to talk her out of being with him, but she apparently loves him so we're all civil about it. He makes very rude jokes and makes me uncomfortable but I typically ignore him when I see him for the sake of my MIL. 
My husband and I went over to their house for dinner this week to catch up with her - plus she hasn't seen me and my 34 week pregnant belly and she's very excited to become a grandma. Anyway, during dinner, the creep man told a very graphic and disgusting "joke" about pushing in a newborn baby's soft spot and causing brain damage. My husband and I were so shocked that this guy would say that and we both froze, not knowing how the hell to respond. And that turned an already awkward evening into a situation I will never be in again. 
Long story short, my baby girl is never going to be near this man as long as I'm alive. We had already told my MIL baby won't be going to their house if my husband and I aren't with her - but now I don't feel comfortable with him interacting with her in any way. Is this something my husband and I should bring up before my due date? How in the world can we phrase it so she doesn't get super offended?