Wednesday, May 23, 2012

Unconscionability

Unconscionability (also known as unconscientious dealings) is a term used in contract law to describe a defense against the enforcement of a contract based on the presence of terms that are excessively unfair to one party. Typically, such a contract is held to be unenforceable because the consideration offered is lacking or is so obviously inadequate that to enforce the contract would be unfair to the party seeking to escape the contract.

If you read this blog, you know where I'm going with this. I'm going to point out some of the more one-sided, onerous terms in a standard publishing contract. And make no mistake--these are practically universal, and for the most part, non-negotiable.

For decades, the only way to get widespread distribution was to sign with a publisher. Writers had no choice. You either accepted the terms, or your book stayed in a file cabinet.

Now, I'm not a lawyer, and nothing in this blog post can or should be taken as legal advice. I'm just someone who has signed publishing contracts and gotten taken advantage of. If any of my interpretations are wrong, I welcome thoughts from those who know better.

Let's start with one of the most obvious, and despicable, clauses, the Grant of Rights.

Author grants and assigns to Publisher the sole and exclusive rights to the Material throughout the Territory during the entire term of the copyright and any renewals and extensions thereof.

In other words, this contract is for the life of the author, plus 70 years after her death, plus renewals and extensions.

Off the top of my head I can't think of any contract that extends beyond the life of the person who signed it. I would guess that my heirs would be bound to this contract, and potentially their heirs as well.

Does that seem a bit one-sided? Perhaps a smidgen unfair to the author?

"Territory" refers to where in the world the publisher is allowed to exploit these rights. In several of my contracts, Territory encompasses the entire world.

I don't consider that unfair, especially if a publisher pays extra for these territories. But none of my contracts have clauses that say I get those rights back if the publisher doesn't exploit them after a certain length of time.

So the publisher can have French or Japanese or Urdu rights for my lifetime plus 70 years, and might never do anything with them. But I can't do anything with them, either.

Subsidiary rights follow a similar pattern. According to this contract I'm citing, the Publisher has the exclusive rights to:

  • Periodical or newspaper before and following publication
  • Publication of condensations, abridgments, and in anthologies
  • Book club publication
  • Direct sale and mail order
  • Braille
How many of these rights have they exploited?
  • ZERO
Why does this seem to me like a selfish child who has too many toys, but refuses to let you play with any of them, even though he won't ever use them himself?

Joint accounting, or basketing, is another clause many authors (me included) got saddled with.

Books 1, 2, and 3 will be held in a joint and open account, and Publisher shall not pay Author's share of royalties and subsidiary rights income on any Book of the Work until Author's share of royalties and subsidiary rights income for all Books exceeds the total advance.

In layman's terms, if you have a three-book deal with an advance of $30,000, you don't make a cent in royalties until all $30,000 has earned out.

Kristine Rusch does a fine job breaking down how this can hurt the author:

If book three earns royalties, those royalties go toward paying off the advances on books one and two. Like this:

  • Advance for book one: $10,000
  • Advance for book two: $10,000
  • Advance for book three: $10,000
  • Book one only earned back $5,000 toward its advance. Book two only earned $6,000 toward its advance.
  • Book three earned $12,000—paying off its advance, with a $2,000 profit.
  • In a standard contract without basket accounting, the writer would have received the $2,000 as a royalty payment.

But with basket accounting, the writer receives nothing. That accounting looks like this:

  • Advance on contract 1: $30,000
  • Earnings on contract 1: $23,000
  • Amount still owed before the advance earns out: $7,000
  • Instead of getting $2,000, the writer looks at the contract and realizes she still has $7,000 before earning out.
  • Without basket accounting, she would have to earn $5,000 to earn out Book 1, and $4,000 to earn out Book 2, but Book 3 would be paying her cold hard cash.

Got the difference?

In short, you can have a successful book, but won't get royalties because other books in the basket weren't as successful (or haven't been released yet.) While this may not seem unreasonable, it certainly favors the publisher. Especially since it is often the publisher's fault a book doesn't sell.

I signed two separate three-book deals with Hyperion. My agent fought to get the basketing clauses removed, but removal was a deal breaker for the publisher.

On the first three books, I was in a royalty situation and had completely earned out within a few years. But on book #4 (the first book in the second contract) my publisher dropped their mystery line and gave my books zero support. No touring (I had two previous tours), no co-op or advertising (I'd gotten a bit of each previously) and they really messed up advance orders so books weren't available in certain key markets on release dates. Despite the fact that two of my hardcovers went into second printings, basketing delayed my royalties at a time when I really needed the money.

Speaking of royalties...

Hardcover: 10% of the invoice price for the first 5000 copies, 12.5% thereof for copies from 5001 to 10,000, and 15% thereof for copies in excess of 10,000.

Mass Market Paperback: 8% of the invoice price for the first 150,000 and 10% thereof for all copies thereafter.

On Ebooks: 25% of the amounts received by Publisher, excluding taxes and invoiced shipping and handling charges. if any.

There are several things I find interesting about this section. First, it's how very little the artist gets. I mean, the Author is the sole reason the Work exists in the first place. But getting, at most, 15% of the hardcover price and  10% of the paperback seems pretty unreasonable.

As can be expected, while sales are basketed, royalties are not. For example, in a three-book deal, if I sell 50,000 copies of Book #1, 50,000 copies of Book #2, and 50,000 Copies of Book #3 (or 150,000 copies total) it doesn't mean I get 10% royalties on them from then on. They each have to sell 150,000 copies for that to happen. That's a pretty big double-standard, ain't it?

But artists tend to get screwed all the time. I've read accounts of musicians getting pennies per album sold and how blockbuster Hollywood movies don't make money (thanks to Techdirt and the irrepressible Mike Masnik for those overviews).

Admitting the problem is widespread doesn't mean it should be ignored. Big companies are exploiting artists. They're getting rich, and the creators are getting shafted.

And for those who want to chime in with "no one forced the artist to sign the deal", that's blaming the victim. "The artist wasn't forced" is a nonsequitur response to "the contract isn't fair." Indentured servants aren't forced either. Nor are field hands picking potatoes in inhumane conditions. Nor are children working in third world sweatshops. Would you argue the conditions of their employment are fair because they went into the agreement willingly?

And for those who want to chime in that these above examples are extreme and offensive and not comparable, let me respond that a kid in a coalmine or a factory worker on an unsafe assembly line or a guy who is paying off his boat ticket to America isn't being forced to work his entire life, plus seventy years.

But besides how little the Author makes per book sold, I'm also curious how these percentages were arrived at. Especially the 25% royalties on ebooks. This comes out to 17.5% of the list price. The publisher gets 52.5% of the list price. And, correct me if I'm wrong, but it seems to be much easier and cheaper to format and upload a single ebook file to Amazon than it does to print and ship 50,000 paperbacks.

In fact, I can format and upload to Amazon, Smashwords, Kobo, Overdrive, and B&N in an hour, and it costs me around $300 thanks to the efforts of Rob Siders. And Rob's ebooks look a helluva lot nicer than many of the Big Publishers ebooks.

Yet publishers have somehow decided that 17.5% is the Author share.

Even more fascinating, they've pretty much ALL DECIDED THIS.

We call the six biggest publishers the Big 6. They envelop dozens of imprints. But there are also many other big hitters in publishing (Scholastic, Harlequin, Disney) and lots of mid-sized and smaller publishers, and somehow they've all arrived at the EXACT SAME ROYALTY RATES.

You can go to different publishers and get higher advances. But unless you are a gigantic bestselling name-brand author, I have never heard of a case where a Publisher offers an Author better royalty rates.

Why is this? You'd think, since publishing claims to be so competitive, that they would lure writers any way they could. Yet they all appear to be in lockstep, offering the exact same royalties.

Isn't that interesting how they all came to the same conclusion and exploited authors in the same exact way? If I didn't know any better, I'd swear these publishers were maybe secretly talking to one another and comparing notes and tacitly agreeing on royalty rates. But they'd never do that, right?

Publisher shall pay Author, as an advance against sums due to the Author hereunder, as follows:

In as many small pieces and over as long a term as possible.

Of course, no contract actually is worded that way. But I've seen many contracts, and the Publisher often tries to break up the advance and spread it out over a long period of time as certain conditions are met, such as signing the Agreement, delivery and acceptance of material, delivery and acceptance of outline, publication date, six months after publication date, six months after paperback publication date, etc.

It is to the Publisher's advantage to delay payment. The longer they do, the more interest they can earn on the principal. It isn't unusual for a contract to be paid out in chunks over several years.

And once it earns out...

Publisher shall provide Author with semi-annual royalty statements showing the amount due to the Author, by April 1 and October 1 of each year for the six-month period ending the preceding December 31 and June 30th, respectively.

Now I can understand how years ago--during the age of snail mail and hand counting--it could take months to compile actual sales data.

But now we have bar codes and the Internet and spreadsheets. Information gathering and transfer is easier, faster, and more accurate than ever. So why are we getting paid every six months?

Can you imagine working a fulltime job, then not getting a paycheck until nine months later? (that's six months of data, which takes three additional months to compile.)

Smashwords pays quarterly, and Mark Coker has a much smaller staff than any major publisher. Kindle, B&N, and Createspace pay monthly. It can be done. But it isn't. And you don't see any of the companies I just mentioned doing this:

Publisher may retain a reasonable reserve against returns in any accounting period. If Author receives an overpayment of royalties resulting from copies of the Work reported sold but subsequently returned, Author shall repay such amounts to Publisher to the extent that Publisher is not able to deduct such amounts from monies due to Author at the end of the royalty payment period after the period in which the overpayment is discovered.

Huh?

Again, I'm no lawyer, but this clause looks like a Publisher can pretty much withhold money from an author. It doesn't define what a "reasonable" reserve is, and doesn't state what conditions need to be met for this to happen. Then it mentions that if it overpays (it can happen--the Publisher only had nine scant months to figure their numbers out), the Author has to repay.

Speaking of repay, during my last contract, with Ace/Berkley, I broke the contract and didn't turn in the second book in a two-book deal. The publisher wanted their advance returned within 30 days of sending me a formal letter, which it did a few weeks after we ended the agreement.

In other words, the Publisher pays the Author slowly, over a long period of time (months or years), and at any given moment can hold onto money due the Author for no specific reason. But when the Author owes the Publisher, it needs to be paid back immediately, or else there will be Trouble.

Here's one of my favorite one-sided clauses that no one seems to pay much attention to:

Unsatisfactory Material: If the Material for a given Book is not, in Publisher's sole judgement, satisfactory in all respects, Publisher may terminate this Agreement upon written notice.

This clause has no specific criteria to determine if a Book is satisfactory. It's purely a judgement call. The Publisher can end the deal for pretty much any reason it sees fit, or for no reason at all. How's that for binding?

Those who read my blog know that Grand Central/Hachette refused to publish my second book in a two-book deal. It was apparently unsatisfactory.

I published it myself. That book, TRAPPED, has gotten 167 four & five star reviews on Amazon, and has earned me over $150,000 in less than two years.

So much for being unsatisfactory. (Incidentally, I did write another book for Grand Central, called ENDURANCE. They wanted editorial changes. I refused and pulled the book. It has also made $150k in under two years. Guess it really didn't need those edits, huh?)

But besides a Publisher being able to--on a whim--refuse to publish a book, the really unfair thing about this clause, and many of the clauses in a standard boilerplate book contract, is the author doesn't have even remotely equal power. Show me this clause:

Unsatisfactory Publication: If the Printed Book of the Work created by the Publisher is not, in the Author's sole judgement, satisfactory in all respects, Author may terminate this Agreement upon written notice.

Can you imagine? How would you like to fire your publisher for giving you a terrible cover or awful title? (Publishers have final approval on titles and covers.) What if they screw up the printing, like omitting the first line or publishing a book riddled with errors? What if they price it too high for the market which costs you sales and income?

The cover for my novel TIMECASTER was unsatisfactory in my opinion. It was generic, and conveyed nothing about the tone, plot, character, or setting. TIMECASTER takes place in a green, utopian future where plants grow on buildings and drugs are legal, the hero is a peace officer decked out with high-tech gear, and the book is loaded with humor and sex.

Though my self-pubbed sales were booming when this was published, Ace insisted on a pen name (and a tiny one at that.)

Compare their cover with the one my cover artist Carl Graves did for the UK edition.

Theirs shows a generic man (hero? villain? male model?) in a decidedly non-green urban area without anything high-tech or futuristic happening. There's fog and a moon (neither of which appear in the book) and nothing that indicates the novel is funny, sexy, or filled with action. It looks noirish and drab, which is the polar opposite of my story, and seems like the title should be BROODING ROMANCE OF THE WEREWOLF instead of TIMECASTER. And WTF is he standing on?
Ace Cover
My cover conveys humor (the smirk), sex (lipstick prints), drugs (leaf tattoo, 4:20 on belt which also speaks to the title), a cool taser, a badge indicating the hero is a cop, plus a tech/futuristic background.
My Cover
Now, some people may prefer Ace's cover, even though it misrepresents my book. That's not the point.

The point is that I find theirs terrible, but I have no recourse. The Author's opinion has none of the weight of the Publisher's opinion.

Publishing contracts ACROSS THE BOARD allow publishers to make a varied and infinite number of potentially career-ending mistakes on the writer’s behalf.

When Hachette found one of my novels unacceptable (and they were wrong) I had no defense--they simply refused to accept it. Even if I'm 100% wrong and Ace's cover is better than mine, I should still have a say. I wrote the book. But I lacked even miniscule bargaining power.

I spoke at length to my editor about TIMECASTER, telling her what I wanted in a cover, and was ignored. But I couldn't do anything. I certainly couldn't terminate the contract because I found my Publisher’s performance to be unsatisfactory.

TIMECASTER has been out for over a year in ebook and paperback, and I've seen it in just about every brick and mortar bookstore I've visited. Kudos to Penguin for doing a great job  with the distribution.

So far, in two royalty statements, TIMECASTER has earned me a total of $3708. That's $309 a month. Last January (in one month) I made $7700 on TRAPPED. So it’s pretty clear my publisher is dramatically underperforming. It also suggests that perhaps I understand a bit more about covers than they do.

But I can’t do anything about it. I don't have an Unsatisfactory Publication clause in my contract. No Author does.

Instead, the Author is faced with the continual threat of action against him by the Publisher at any time, and no definable cause.

Such penalties include (a) withholding payment due; (b) refusal to publish; (c) being forced to reimburse the Publisher for advances or monies due; (d) refusal to extend time for delivery (when Publisher consistently takes a lengthy amount of time to return signed contracts, pay advances, and pay royalties); (e) Indemnity (Author shall indemnify and hold Publisher harmless from any losses, expenses, settlements, recoveries, or judgements arising from or related to any claim, action or proceeding which would constitute a breach of Author's representations and warranties.)

So even though the Publisher takes the lion's share of the profits, it doesn't make any effort to protect the acquired Work from any lawsuits, so the Author takes all the blame and financial burden.

Contrast that to any Third-Party Infringement, where the Publisher can take legal action against copyright violators, then split the recovery 50/50 after being compensated for legal expenses.

So the Publisher will use lawyers to get money it feels it is owed, but not use lawyers to protect the Author who is being sued. It only protects itself, then bills the author.

Let's see what else is unconscionable in publishing contracts, shall we?

Competing Works: During the term hereof, Author shall not publish any book on the same or similar subject matter as any Book of the Work that would directly compete in the marketplace with sales of that Book of Work. Author shall not undertake to write another book for another Publisher until the Material for the last Book of the Work is delivered.

Again, I'm no lawyer, but to me this seems a lot like: Not only do we own your book, we own you.

What I do with my time is my business, isn't it? Shouldn't I be able to write other books, for myself or for other publishers?

And why do publishers think books compete with each other? Every bit of evidence I've accumulated, by both self-publishing and legacy publishing, shows that the more books I have available, the more I sell. Readers like one of my books, then buy the others. More titles means more chances of being discovered.

Yet this clause basically says, "as long as you work for us, you can't do anything else."

It gets even worse when there's also one of these:

Option: Author agrees not to submit an outline and sample chapter for Author's next book to any other publisher until such outline and sample chapter has first been submitted to Publisher, and Publisher has had 45 days to advise Author whether it wishes to publish the book and to negotiate a publication agreement with Author.

So not only does the Publisher own the Author in the present, it also holds the Author's future hostage.

Imagine if the reverse was true. What if the Author told the Publisher it couldn't publish any other author's books while it was publishing the Author's Work, and that the Publisher would need permission from the Author to publish any other books by anyone else in the future? How ridiculous does that sound?

But here is my favorite unfair clause.

Out-of-Print Termination: If a Book of the Work is out-of-print, Author may serve Publisher with a written notice requesting reversion of the rights granted hereunder. Publisher shall, within six months of receiving such notice, do one of the following: (i) declare in writing its intention to reissue an edition of the Book in question within six months; or (ii) enter into a licence providing for the publication in the United States of a new edition of the Book in question within six months; or (iii) revert in writing to Author the rights granted to Publisher herein for such Book. A Book of the Work shall be deemed out-of-print is, after two years from the date of first publication, no edition of that Book of the Work is available in the United States from Publisher or a licensee of Publisher and there is no license in effect which provides for the publication or reissue of an edition of that Book of the Work in the United States within 12 months from the date of notice.

Here's my burning question: When does an ebook ever go out of print?

I assume publishers are going to argue that an ebook counts as an "edition." If that's the case, why have an Out-of-Print clause at all? Isn't this absurd, contradictory, unjust, and/or unreasonable?

Let's say my many predictions are correct, and ebooks are the future. What's to prevent a publisher from keeping a book in print just to maintain control over the ebook rights? After all, when I ask for my rights back, they can take as long as 18 months to print more copies.

Is this fair? Especially since this contract was signed before the current ebook boom? Or can this be considered inadequate consideration?

I believe a reasonable person could look at these clauses and come to the conclusion that they are heavily weighted against the Author, and overwhelmingly biased favorably toward the Publisher.

But, hey, we should just be happy we got a deal at all, right? Especially one that gets us this fantastic clause that makes everything all better:

Twenty-five free copies of each book of the work and 50% off additional copies! Woo-hoo!

That, right there, is the ultimate slap-in-the-face placation.

"We understand what you want, Little Author. We know that the most important thing for you is  to get published, no matter what it takes. You can't pick your own title. You can't pick your own cover. You have to bend over and take everything we force upon you, and receive piss-poor compensation for it. But who cares! You're a real author now! And you get to buy books from us for half off!* Isn't it great to see your name on a real book! You finally made it! You should be so happy we did this for you!"

(*Half off as long as you don't resell them--that's in the contract.)


So... who represents our interests in these onerous, one-sided, contracts?

Is it agents?

Few agents have law degrees, so most aren't legally able to interpret or advise their clients on contract matters. (This while the Publisher has a whole team of lawyers.) Worse, agents have revealed themselves to be on the Publishers' side, which is an enormous conflict of interest.

The Authors Guild? Nope. They've also come out on the side of Publishers. Unlike the Writers Guild, which represents screenwriters, the Authors Guild has never lead a strike, never eliminated any of the unfair clauses mentioned above, and to my knowledge has never managed to improve or remove any of the unfair clauses mentioned above.

What we have here is an entire industry using boilerplate contracts and universally accepted one-sided clauses to exploit an entire segment of people.

This system is designed to take advantage of Authors' naivete and lack of bargaining power, and it uses the promise of publication as a carrot to get them to accept onerous, deeply biased terms.

Writers, and their agents, cannot effectively negotiate if the majority of the boilerplate is "my way or the highway."

Moreover, because the Big 6 are in such lockstep when it comes to this boilerplate, they have effectively created a unified front (don’t want to use the inflammatory M word--that’s only for Amazon). In other words, there is simply no other option because the Big Publishing Cartel have the unfair-contract market thoroughly cornered.

Finally, the contracts are so heavily weighted toward the Publisher that the Author can't get out of the bad deal he had no real choice but to sign.

And let's make that clear. Prior to the current ebook explosion, the Author had no choice. The only way to get into the stores that sell books was to sign a deal with a Publisher. Authors accepted unfair terms because the alternative was never seeing your book in print or making any money at all.

Does this fit the legal definition of unconscionability? I don't know, I'm not a lawyer. But it sure seems to fit the moral one.

I'm not an agent, either. I'm just a writer. But doesn't it make you wonder why a writer wrote this piece bemoaning the bias in publishing contracts, rather than an agent, or the AAR? Yet the AAR is sure quick to point out how fair the Agency model is, aren't they? Why isn't their board of directors sending letters to Publishers criticizing these unfair clauses, rather than letters to the DOJ supporting Publishers?

Rereading what I've written here, certain ideas and parallels spring to mind. We've got an all-powerful industry unfairly negotiating with the weak and hopeful. I believe this qualifies as exploitation. But there's something more going on here. Writers aren't just being exploited financially. Their dreams are also being exploited.

This is taking advantage of the desperate. It's akin to price gouging by overcharging for potable water after a disaster, or quacks who get a terminally ill patient to sign over his mortgage in the hopes that electric enemas will cure his cancer, or coyotes charging a whole year of wages for the chance to be smuggled into the American dream.

It's a sister to influence peddling, a cousin to payola, and a distant relative to price-fixing where the publishers universally maintain control via onerous contract terms.

It's reprehensible.

This is institutionalized corruption. And we can't expect anyone to fight for our rights. Until the rest of Big Publishing follow Houghton Mifflin Harcourt into bankruptcy, or a group of authors band together to fight these unconscionable contracts, nothing is going to improve.

But authors won't band together. The rich, successful ones don't want to jeopardize their favored status. The newbies and disenfranchised still scurry for a pat on the head, and are more than willing to fill any slot that opens up, even with onerous terms.

Agents won't form any sort of united front. They've already shown who they really work for. And even if a handful summoned up the courage to fight the status quo, chances are their authors wouldn't back them up out of fear.

Publishers won't change, because they have no incentive to.

So what's left?

Education. Information. Data. Knowledge. Logic. Common sense. Fisking. Debating. Arguing. Beating the drum over and over and OVER until it gets heard by all.

This industry is sick, and it isn't going to get better. But the more we talk about how unfair it is, the easier it becomes to break away from it.

Big Publishing needs to be exposed for what it is. It needs to be ridiculed. Those who defend it need to be revealed as ignorant, as cowardly, as wrong.

We can't change the industry. But we can damn sure hasten its demise by showing all authors--old veterans, struggling newbies, and those not even born yet--that there is another way to reach readers.

It's called self-publishing. If you read this blog, maybe you've heard of it.

104 comments:

Archangel said...

You hit it Joe. Sing it.

This axis drives many of us insane: the author has to and wants to turn in an ultra clear ms according to whomever holds the blue pencil, but the publs can turn out utterly opaque and insensible crap royalty statements year after year that no reasoned person can decipher without either a crystal ball or /and a sharp certified public accountant audit.

You're right about squatting on rights and not developing them. It is some kind of addled classist Divine Providence practice that sucks for the author --- if lifespan is indeed aprx 76 years, then for over 100 years assuming one sold a book to a pub whilst middleaged, the pub would keep claws on others' eggs... while author gets another day older and deeper in debt. Not developing those 'rights' or I should say at this point 'wrongs' leaves more than just money on the table. It is a gutting of imagination and freedom of the author to develop their own work. Have had great pubs, also some that should be in jail for deceit and patronizing alone.

Rock on.

Joe Konrath said...

It's worth repeating that I managed to get out of book contracts with Penguin and with Hachette.

One would think, with publishing contracts being so Draconian, that Publishers would have included mucho legal language forcing me to finish out my book deals.

But here's the thing: Publishers know that Authors want to be in print so badly, none of them could imagine or comprehend that an Author would ever want to break a contract. So the legalese wasn't there.

I bought my way out of both deals. Best thing I ever did for my career.

But I bet that, in the near future, publishers will begin including a clause that penalizes the Author for not turning in an acceptable manuscript. As more authors wiggle their way out of multi-book deals and self pub, you can expect this clause to appear soon.

Shantnu Tiwari said...

Excellent post as always Joe!

The whole system is corrupt, and there needs to be a serious shake through. I don't know if the Doj lawsuit will accomplish this, though. We are beyond the stage of minor tinkering with this contract or that....

One thing many people say when they comment about your blog (on other sites, as it seems they are too scared of you to post here :) ) is that "My agent / publisher is so good, I don't know what that Konrath guy is moaning about."

Many slave owners were very good people personally. They treated their slaves well, fed them well, educated them. But this doesn't mean slave trading was a good system. You wouldn't be justified by saying "But X is such a nice slave owner. How can you say slavery is bad?"

Yet we hear this logic in publishing everyday....

Archangel said...

Joe, I hope you'll say more about how to... "I bought my way out of both deals. Best thing I ever did for my career." Many of us dangling by one foot re pub withholding mss after we broke contract, but they demand full advance back long after advance spent to, like you know, live on with family and elders. If we cant raise advance pay-back lump sum, they continue squat on mms. We know answer is to keep creating, which many of us are with all the stones we've got, but/and hate to have our works held hostage after giving several years to writing them in good faith, NEVER seeing the editorial wreck coming... til run down like a dog in the highway and severed from our works... for many of us, for years now. We think pub have written off the advances as bad business debt and taken a tx deduction on our bones, and still and yet want to have turnip blood.

Just have to keep kicking it to write more, but idea of printing press in basement crosses mind as wishful thinks.

Archangel said...

Joe: you wrote: ...in the near future, publishers will begin including a clausethat penalizes the Author for not turning in an acceptable manuscript. As more authors wiggle their way out of multi-book deals and self pub, you can expect this clause to appear soon."...

I believe the big pubs already have had that for the last two decades. If you turn in ms and they dont like it for the second or third time and you say, I'm breaking contract. They say, fine, pay us back everything we ever gave you and you can have your ms back. But until then we'll sue you if you try to publish it.

This means for those who spent years to write a huge book with miles of research for instance, in somehow paying back authors' advance, author was then essentially paid $0 for years of hard work.

I think you are right... it appears to be work on spec with no kill fee if they decide they dont like it and want you to try again for the 2, 3 or 5 th time. Completely indecent wage.

antares said...

I wondered when someone would raise the issue of unconscionability. I did statistics (data collation, analyses, and report generation) for my contracts and business law professor at law school. He surveyed many law schools to find out how many law professors taught unconscionability. The answer . . . about half.

One of the great legal fictions is that the law assumes both parties to a contract stand in equal bargaining positions. This is not so, and we know it.

I doubt the unconscionability argument would get much traction in court, but it is a possible argument. In short, unconscionability means that the terms of the contract are so outrageous or immoral that it is against public policy to enforce it. Contracts for sexual services fall under this head (except in some counties in Nevada).

I would argue that the standard publishers' contract is one of adhesion and is voidable. http://legal-dictionary.thefreedictionary.com/Adhesion+Contract

Adhesion is a lawyer's ten-dollar word that means the bargaining positions were so unequal that the contract was take-it-or-leave-it. Shades of Simon Lipskar's argument there. Given that ALL publishers contracts look alike, I think this argument would play better before a jury than unconscionability. Of course, the problem is finding a plaintiff willing -- and able -- to take his publisher to court. Lawyers' adage: You can beat the rap, but can you stand the ride? It's gonna be expensive, and, if you win, the court tears up the contract and you get your book back. But no money unless you win on some other point of law.

Joe, When will you make a case against publishers' 'No simultaneous submissions' policy? Restraint of trade. When will DoJ go after them for RICO violations on this one issue alone?

Ken Hansen said...

Hi Joe,

You wrote: "I have never heard of a case where a Publisher offers an Author better royalty rates."

Mine offers 85% royalty, to the author.

Now you have :)

Jen Talty said...

Frankly, most authors don't really think about how the breakdown of their advance, print runs and royalty payouts (if any) will work until AFTER they sign the contract. We authors want to be published and we want it to be "credible". The Big 6 give off an illusion of security (because they pay an advance) and many writers feel like the road to success might be easier. Many authors know that the contract isn't in their favor. Organizations like RWA help authors sort through what is good and what is bad--but the big 6 is never really seen as bad. HQN has one of the worst contracts, but they are the pillar of RWA. Don't get me wrong. I love RWA. I am a member and will stay a member. I get support and friendship and lots of other benefits, but the focus is on HQN and the other major players in NY. The focus is still on print--where the focus should be on the future because the future is now.

I get asked all the time why did I stop submitting to NY 2 years ago and totally turned my focus on Cool Gus Publishing and Bob Mayer--well, duh! Its a better deal!

I once said at a workshop that it wasn't just NY that needed to change, but authors needed to change the way they think and the way they do business. Writing isn't about getting to a publisher, but getting your book to the readers.

D. Nathan Hilliard said...

Thank you for showing us this stuff, Joe. A lot of us new writers need to know this stuff.

Thanks!

Anonymous said...

My contract is nearly identical with Joe's list of ugly clauses. I wanted to give an example of one.

My agent fought against the "we own your future clause", but it was going to be a deal breaker. It was my debut (coming out in the Fall), I hadn't clued in as much to the increasing power authors have in this game now (I was not in the business, coming from totally different line of work, started writing from internal compulsion), and I thought I really had no choice: sign on or book bytes rot in the cloud. This was my chance! How could I blow it?

That's why what this post is anonymous: I'm still afraid for this book and the next books that they have quasi-rights to already. Funny/sad thing: my publisher (the editors, copy-editors, graphic artists, etc) are people I LIKE. They are nice, sincere, work hard, and are worried about their jobs and business. They are just in a terrible, terrible system that is so corrupt, you can't work in it without being tainted. It is basically abusive and exploitative.

OK, here we go:

"You own my future" clause, broken up in pieces with commentary

The Author hereby grants to the Publisher the exclusive right and option to acquire for publication his next book-length work of mystery or thriller fiction, subject to the terms and conditions hereinafter set forth.

At least they limited it to two genres. I should consider myself "lucky."


The Author shall submit the completed manuscript or a synopsis and first two chapters of such work to the Publisher before offering or submitting same to any other party. The Publisher shall have a period of thirty (30) days after submission of a full manuscript of such work, or ninety (90) days before the Publisher’s first publication of the Work hereunder if a synopsis and first chapters are submitted, within which to notify the Author whether it desires to publish such work.

90 days after the work that they have me in contract for. For me, that is 9 months AFTER I finished the next book! Which means it could be 1.5-2 years before they move the next one to print IF they take it! Don't quit your day job, son.

If within such period the Publisher notifies the Author of its desire to publish such work, the parties shall negotiate in good faith with respect to the terms of an agreement to publish such work. During the entire period the Author shall not submit or offer such work to any other party or negotiate with any other party with respect to such work.

So much for competition. But, ok, this seems the least onerous.


If the Author and the Publisher are unable to reach an agreement, the Author may offer such work to other parties, provided, however, that he shall not enter into an agreement for the publication of such work with any other publisher upon terms equal to or less favorable than those offered by the Publisher.

"Less favorable" as defined by?


In the event that the Author is unable to reach an agreement with either the Publisher or any other party for publication of such work, this option will continue to apply with the same force and effect to the succeeding book-length work of mystery or thriller fiction, created by the Author, until such an agreement is reached with either the Publisher or another party.

So, in other words, they are really staking claim to the future of MY BEST WORK, whenever that comes. "You took the best of me" my love.

Final point: when you can't negotiate, all the rights and money are skewed in one direction, there is a tyranny, collusion, etc. Not a free market for sure. Zero competition (the ebook % argument is decisive, but many others make the case as well).

Kristi Lea said...

I signed with a small e-press for my first book and I'm happy to report that none of these clauses appeared in my contract. They didn't own my name, had no claims on future work, the contract has a fixed expiration date (4 years, not life of copyright, and no out-of-print conditions). I was thrilled to walk through the process with someone else footing the bill for a cover and formatting and editing. And I got my first royalty check (not huge but > 0) three months after publication (about 6 months after signing the contract). Royalties are 25%/35% of cover price depending on where the copies are sold.

No, my debut wasn't front-and-center in a hundred bookstores (and its e-first not print-first), but it made good business sense for me. I haven't hit any lists. (I haven't racked up credit cards on marketing either).

As I finish additional books, I know I have choices about how I attempt to sell them.

Thank you for continuing to educate writers, continuing to talk about those topics that other shy away from, and continuing to enable change in an industry that desperately needs it.

Anonymous said...

I used to work for a Big 6 publisher and saw virtually every book contract. I can tell you with confidence that 90% of them have no substantive differences except advance and maybe--maybe--royalties. It doesn't matter who the agent was. Agents don't change boilerplate--they merely clarify what is already there and even then it produces little significant value.

The only real value an agent brings to the table is access to the publisher and negotiating the money and main royalties of the initial deal. Everything else is assumed as standard with tweaks to make the agent look good to the client. But they're only tweaks.

My sense from your posts, Joe, is that Barry's legacy deals were at least an order of magnitude larger than yours. I bet if you compared contracts where this was so, you would see what I mean vis-a-vis substantive changes.

Btw, the rich, successful authors aren't afraid to jeopardize their favored status. The fact that they have favored status means they are immune to a lot of this contractual exploitation. They get real contract changes.(I laughed recently when a Famous Author recommended authors insist on author approval of audio talent. I thought that author had seriously forgotten what it's like for 99% of authors).

No one cares if a 10K advance author screams dealbreaker. The publisher sees that author is pretty much replaceable and, better, not at all likely to have another publisher jump on that 10K blockbuster, so the author will cave.

It's incredibly lopsided and any agent who says they can work wonders is blowing smoke.

Thom said...

Yep, the terrible royalty % sounds familiar. I think we in the WGA struck because on a $18 DVD sale, the writer of the film was collecting--hold for it--one, slim, nickel!

But the difference is, we could STRIKE. And the Guild had negotiated upfront payments, kind of like advances, except we didn't have to earn them out.

My point is, literary authors are taking it in the shorts. The only way you folks can strike is to walk away from these one-sided deals.

J. R. McLemore said...
This comment has been removed by the author.
J. R. McLemore said...

I opted to self-publish my work from the start, choosing to have complete creative control and freedom over my own work. In many ways, I have you to thank for that.

After reading this (and many of your previous) post, I can't help but view the Big 6 publishers as the various ministries from Orwell's 1984. Outwardly, to the public, they try to convey a message of peace and knowledge. However, on the inside, they are nothing but a corpse-grinding machine feeding greedy corporate suits.

Fuck that! I'm so thankful that I'm not fodder for their mill. Thanks again, Joe.

Unknown said...

Given the growing movement criticizing industry standards, I think it would be very interesting and stimulating to the writing community for someone to post a "Dreams of a Modernized Publishing Contract" that would put the author in a much more fair position.

It could be based on the industry boilerplate in many ways, I assume, with major % and rights changes, however. Additional clauses to protect the author could be added (should be added), onerous terms removed or altered significantly.

This would not be to screw the publishers (it might actually help them, as bad business practices sink you in the end). I think it would be great to have a fair contract for everyone. Something reflecting equal bargaining power, "what if": what if authors and publishers had roughly equal bargaining power? What would a fair contract potentially look like? Ideally, something a contract lawyer would put together or look over.

Having that for every author to download and consider might have an interesting impact, and would certainly stimulate discussion!

Just a (dangerous?) idea. ;)

Todd Trumpet said...

...newbies and disenfranchised [writers] still scurry for a pat on the head, and are more than willing to fill any slot that opens up, even with onerous terms.

This is the problem in a nutshell...

...though Shakespeare's take on lawyers might help.

Todd
www.ToddTrumpet.com

Anonymous said...

btw, don't think a lawyer will help all that much over an agent. One of the first things I was told in publishing was that if a lawyer called, just keep saying no. They give up pretty quickly. Why? Because the lawyer charges by the minute and no lawyer wants to say to their client "I didn't get it. Here's my bill."

Sad to say, worked like a charm.

Gary Dobbs/Jack Martin said...

I love this blog and think there's a lot of useful stuff on here, but all this publisher bashing is getting tedious

Joe Konrath said...

but all this publisher bashing is getting tedious

As tedious as 30 years of publishers exploiting writers?

C. Amethyst Frost said...

"Territory" refers to where in the world the publisher is allowed to exploit these rights. In several of my contracts, Territory encompasses the entire world

Just for fun, you should translate one of your books to Klingon, shove it in a time capsule, and send it to the next space shuttle launch.

(Incidentally, I did write another book for Grand Central, called ENDURANCE. They wanted editorial changes. I refused and pulled the book.)

Joe, you are like an abused spouse who keeps going back for more. It's good to see that you did finally cut the cord.


So not only does the Publisher own the Author in the present, it also holds the Author's future hostage.

No kidding. Think about how long it takes to get a book published traditionally. First, you submit a manuscript and are expected to wait 3 months for their response before doing anything with it. If they accept you, you have to wait for your book to be placed in their queue on their schedule. You have to wait for them to review the book, submit requested changes, and wait for final approval. After all that, many publishers have a policy of "published 1-2 years after acceptance." That explains the "70 years after death" clause. That's how long it takes to get the book moving.

Tammy Cravit said...

With the obvious disclaimer ("I am not a lawyer; I am a paralegal; this is not legal advice), I thought it might be instructive to list some of the things that courts typically look to when determining whether a contract's terms are unconscionable:

- The contract is imposed and drafted by the party of superior bargaining strength, and relegates to the subscribing party only the opportunity to adhere to the contract or reject it;

- The contract contains open-ended provisions that give the seller unilateral discretion to set or change terms relating to price or conditions of service;

- There existed “no business reality” to justify the lack of mutuality;

- The supposedly agreed-upon terms
of the bargain are hidden in the printed form
drafted by the party seeking to enforce the disputed
terms.

In California, an unconscionable contract is one that includes both "procedural unconscionability" and "substantive unconscionability". The former refers to the absence of meaningful negotiation because of unequal bargaining power and terms buried in the text of the contract so as to 'surprise' the other party. The latter, more of a judgment call, talks about contract terms that are "overly harsh" and that "produce a one-sided result without justification."

Sound familiar? I thought so.

Becca Mills said...

Hot damn! Right on.

I'm coming to authorship relatively late in life. It's something I always sort of wanted to do, but the whole process seemed terrifyingly awful. Only after reading your blog and realizing that indie was a viable option did I begin thinking this was something I might actually be able to do. If I had deal with the old system, the kind of contract you're analyzing here, I just wouldn't have done it.

Rob Gregory Browne said...

The sad truth is that many writers (probably most) don't even bother to pay much attention to these things in their contracts. There is such a feeling of elation when you finally get accepted, especially by one of the big houses, that all these matters seem trivial.

You trust your agent to negotiate favorable terms and go about your work. Which is a huge mistake (you should read every line) in many cases, but not surprising since most writers are not businessmen.

I've had several publishing contracts and I have to say there were a few things here that were even a surprise to me.

Merrill Heath said...

This is off topic but, Rob, I just checked and Trial Junkies is #2 on the Amazon free list. Good for you!

Anonymous said...

"In other words, this contract is for the life of the author, plus 70 years after her death, plus renewals and extensions."

Negative, Ghostrider. Thanks to the Copyright Act of 1976, any contract executed after 1978 that grants usage of a copyright may be terminated by the copyright owner after 35 years.

You should do a post on the shitstorm this is about to cause. Most people aren't paying attention to it, but the first of those 1978 contracts are coming up for the 35 year termination. The music industry is really shitting itself.

Rob Gregory Browne said...

Thanks Merrill!

Yeah, the community really came to my aid yesterday and got the word out. It went pretty crazy on Twitter and facebook and Joe's blog helped enormously (thanks again, Joe). Then the push from Tess Gerritsen to her 130,000 facebook fans helped it really take off.

I'm blessed, and the first emails I'm getting from readers are the kind any writer wants to receive. I'm less scared today, but we'll see what happens with all the FREE dust settles.

I.J.Parker said...

As Rob says, few of us ever argue contract points with the agent who got us a big-6 publisher. The agent (on the phone after her assistant has announced, "Will you hold for (her name), please?") sounds delighted to be the bearer of such great news. You listen to a few highlights while doing a little dance, and you accept. Then the contract arrives, all 18 double-sided, tiny-print pages of it. You read, your eyes glaze, you don't understand anything after p. 3, even with a Ph.D. in English. And you turn to the final page and sign.
Years later, you may voice your first complaint to the agent. The answer will be, "All of them are like that. What you're asking for is simply not an option."

I refuse to take the blame for my ten contract signings. I was sand-bagged. And the things not covered in the contracts are probably more vicious than the contracts themselves. The absence of proper marketing and publicity, for example.

T Gibson said...

Publishers have been exploiting writers for a lot longer than 30 years, Joe. Jane Austen submitted a manuscript to a publisher in 1803. The publisher sat on it- did nothing with it. Jane was finally able to buy back the rights to it in 1816, and then sent it to another publisher. The manuscript became Northanger Abbey, but too bad Jane couldn't have published it herself.

Robert Bidinotto said...

Joe, this is one of your best "overview" posts ever. While focusing on the "unconscionable" contracts offered by Legacy Inc., you also conduct drive-by shootings targeting a host of onerous practices that have made traditional publishing such a rotten deal for most authors.

I'm forwarding the link to this blog to a bunch of writers poised to jump off the cliff by signing terrible Legacy contracts. I'm sure its timely message will spare a number of literary careers. I'll also include the link in a piece contrasting Legacy and indie publishing that I'm writing for a major blog site.

Joe, as I've told you before, posts like this one from you, starting in late 2010, were pivotal to my decision to self-publish. As for how that decision has worked out for me, the May issue of the Kindle Direct Publishing Newsletter has the story. (Scroll down to the "Your Voice" feature.)

I've told you before how grateful I am for your sage, life-changing advice, Joe. You've heard that so often from so many that it must bore you to tears. However, even for those of us who have already made the choice to self-publish, your blog continues to offer the equivalent of post-graduate courses. This one is an example.

Perhaps the best "thank you" we can offer -- in addition to self-publishing successfully -- is simply to spread these messages far and wide. Keep it up, okay?

Veronica - Eloheim said...

Hot Damn Joe....I've been reading your blog for a couple of years now. This is the best post you have done.

Thank you!

Anonymous said...

The bottom line is that you own your book at the start. If you sell it to someone else then you don't own it any more, they do. You voluntarily gave it up for something else (usually a MS that gets made into bona fide book, plus some money up front, and maybe some money down the road, depending). If you don't like what you're going to get, then don't sell it in the first place. If you do sell it, then don't complain about it later. It was your choice. No one held a gun to your head. You're not a "victim," you're just a person who entered into a deal. It's pretty simple.

Jeff said...

I'm just a lowly law student (but if it helps my credibility, I'm kind of kicking ass at it). I've only skimmed the comments, so hopefully I'm not redundant here.

First I should point out that antares's definition of unconscionability is not quite right. Contracts void for public policy reasons (e.g. courts won't enforce contracts for prostitution) are a different thing than unconscionability.

The requirements for a contract to be void due to unconscionability vary by jurisdiction, but most do require both substantive and procedural unconscionability, as Tammy said. I'm not familiar with California law specifically, but she listed some good factors for determining substantive unconscionability.

But I feel that procedural unconscionability needs to be emphasized more heavily in the context of publishing.

Procedural unconscionability is simply the absence of a meaningful choice by the 'victim.' This strikes me as especially relevant. Evidence of success in self-publishing would strongly weigh against a finding of unconscionability. Joe actually pointed this out in the article: "And let's make that clear. Prior to the current ebook explosion, the Author had no choice."

So, all I'm doing here is emphasizing the importance of that. A court would require more than just an unfair contract. Strictly speaking, an adhesion contract by itself can still be enforceable.

Last, I would point out that courts are hesitant to void contracts on the basis of unconscionability, and generally with good reason. When they do invoke unconscionability, they are essentially taking away parties' freedom to contract in certain ways. By precedent, everyone is affected, not just the parties in a given suit. Now, I'm sure that Joe would argue that this would be a good thing. But still, taking away freedom in any capacity is something courts dislike. There are good arguments on both sides.

But I recognize that this is about more than what a court would do. It's about a slew of things that suck about publishing contracts. Things that the rise of meaningful alternatives, like self-pub, will force to change.

On an unrelated note, just want to praise the blog a little. I've been perusing the past few weeks. There does seem to be a bit much of the raging against the publishing machine, but it's always interwoven with good information and valid points.

Anonymous said...

"But authors won't band together. The rich, successful ones don't want to jeopardize their favoured status. The newbies and disenfranchised still scurry for a pat on the head, and are more than willing to fill any slot that opens up, even with onerous terms."

I wonder if Grisham is planning to write a book about a struggling author who takes on a young lawyer to help them beat a publisher’s contract (though I think it would have to be a sexier problem than a ‘no-compete clause’ – perhaps something murky involving plagiarism or copyright infringement). He seems to have covered the ground in most other areas of legal (mal)practise, why not this one?

Rob Gregory Browne said...

By the way, Joe, I fucking LOVE the second TIMECASTER cover.

Meryl Yourish said...

As I get closer to finishing my novel, I started thinking that perhaps I might try for a traditional publisher, after all. I have a good day job that isn't in any danger, and I can be patient.

Then I read this post and remembered, oh, yeah--that's why I'm going to e-publish and market the hell out of my book.

Thanks, Joe.

Anonymous said...

J.A. -- When I got my first publishing contract, the head of the imprint said, Read it over, sign it and send it back. It's all standard stuff, I was assured.

I read it over and saw a bunch of stuff -- stuff you point out in this post -- and thought, Fuck that. I got in touch with my editor and he said, If there's anything in there you don't like, let them know. I'm sure we'll work it out. They really want the book.

I crossed out a bunch of shit, appended some counter-proposals and sent it back, unsigned, of course.

Never heard from them again...

B. Justin Shier said...

Robert Bidinotto said:

"...your blog continues to offer the equivalent of post-graduate courses..."

The distinguishing factor being that Joe's posts are entertaining.

B.

Ann Voss Peterson said...

Great post, Joe.

Information is the key. Writers learning what they're likely to face in publishing contracts. Writers learning how those contracts translate into dollars in the real world. It's strange that anonymous people like to call that bashing publishers.

I call it educating writers.

T.A.K. said...

Anonymous said, "I used to work for a Big 6 publisher and saw virtually every book contract. I can tell you with confidence that 90% of them have no substantive differences except advance and maybe--maybe--royalties. It doesn't matter who the agent was. Agents don't change boilerplate--they merely clarify what is already there and even then it produces little significant value.

The only real value an agent brings to the table is access to the publisher and negotiating the money and main royalties of the initial deal. Everything else is assumed as standard with tweaks to make the agent look good to the client. But they're only tweaks."

Wow and double wow.

Thank for posting, Anonymous.

My last publishing contract had some clauses I felt were worded in a confusing manner. I pointed them out to my agent (who I have since fired) and he said, "That's all just boilerplate."

I had two different agents "negotiate" two traditional publishing contracts for me.

I won't go into details except to say the part of your post which gets me is that the tweaks are there so the agent can look good to the client.

I'm not surprised.

What enrages me is publishers require me to have an agent. I pay the agent 15% of my earnings, but the agent is just a stooge for the publisher, an out-sourced slush reader (as Dean Wesley Smith explains.)

Fine. I understand why publishers want writers to have agents -- it's easier to lead them by the nose.

What's preposterous is that I pay the agent.

PolyWogg said...

I love your stuff, Joe, but the "blame the victim" elements seem to me to be just a strawman.

The author does have a choice -- do something else. The other examples you use (child labour, etc.) are not choices -- the alternative is extreme poverty and death instead of abject poverty and exploitation. Fair? No.

But if you're a writer, and it's your "dream", that doesn't raise it to "no other choice". That's like saying, "Oh, my dream is to own a Ferrari and I don't have the money, so the price can't be fair." Publishing, having a contract, all those things are not things you are "entitled" to, nor are they necessities of life.

I agree that it may not be "fair" by a traditional definition, but it IS by a legal definition... more accurately, I think, you are arguing it is fair, but not "just".

In legal terms, any contract willingly entered into is deemed to be fair -- that you got something for the fact that your name is on a book, and it isn't up to the courts to decide if "royalties + name on book" is unfair because royalties are small...only you as owner of your "dream" can say what you got out of having your "dream" realized.

In fact, its the reason so many vanity presses could rip so many people off -- they gave up the royalty and legitimacy and sales side of things to have their name on a book.

Your other alternative was not to publish...not "just", but legally fair.

No different, in fact, with someone saying, "Oh, my writign should pay me $100K a year" when in fact they suck...not "just" that they can't make a decent living doing what they love, but fair based on the fact that they have no talent.

The Writers Union of Canada, the Authors Guild, etc all like to do this too -- "We're victims, save us"...and just as the women's movement took so long to more universally recognize that they're nobody's "victim" that has to be protected, writers will only take their rightful economic and business place when they stop saying "I'm a helpless artist" and start saying "I'm an entrepreneur in artist's clothing, let's do business."

I love the rest of your post, and your whole blog actually, I just think you dropped the mantle of leadership on that one :) Okay, now get back to leading the charge! hehehe

Joe Konrath said...

But if you're a writer, and it's your "dream", that doesn't raise it to "no other choice".

I suppose a dream can be deferred. Then you can eat the raisin when it has dried up. :P

I never considered that I had a choice. I was a writer. Writers write. I was going to write whether I ever made a cent. Given the opportunity to make money, I did. And I was taken advantage of.

You can't blame someone for getting a crummy deal. That is indeed blaming the victim. If I go to Vegas and play Blackjack and the dealer cheats you can't say, "Well, it's your fault for choosing to gamble."

Anonymous said...

Anon from 12:07pm here.

My comment was not intended to be snark or argumentative. Now that I have the time, I'll expand on it.

Section 203 of the 1976 copyright act includes a clause that allows a copyright holder to terminate the grant of a work that was executed on of after January 1, 1978 at the end of 35 years. It doesn't matter how long the contract stated the publisher could exercise the contract. The exception is a work for hire.

So what is 35 years from 1978? 2013. That date is coming soon.

Unfortunately, not many artists know about this. And the bad thing about this lack of knowledge is that there is a 5 year window in which the termination can be exercised.

And don't expect the publishers to let some of these still profitable works go without a fight. Victor Willis--you probably know him as the police man in the Village People, who did YMCA--filed to reclaim his copyright.

His publisher sued him. They claimed his work was for hire, then they claimed he couldn't regain the copyright because the works he wanted to reclaim were copyrighted by multiple artists. In the end, Victor won.

Yes, many readers will not feel publishers are screwing over writers with these contract clauses being discussed, but if we start seeing lawsuits against writers who legally attempt to regain their copyrights, will there be any doubt that this screwing over is exactly what is happening?

Writers need to be informed of this copyright termination clause, which is why I ask you writers to research the issue and spread the word.

Aric Mitchell said...

@PolyWogg: I think the point is to make writers wake up and realize the scales of traditional publishing are tipped severely in favor of the publisher, and that a writer should be careful what he wishes for, if seeking a publishing contract, because he just might get it.

No, one's life doesn't depend on these contracts, but one's livelihood does. Or did.

You are right in that writers now have choices. Therefore, if they do sign one of these idiotic contracts, they essentially get what they deserve. That wasn't the case, however, before self-pubbing became a viable form of earning money.

Now I don't believe trad-publishing is always for dummies. If you can get a contract where your talent and effort are respected and appreciated in the terms, then I say have at it. But there have been too many burned mid-listers for me to believe anything other than what Joe has described is the norm.

Jeff said...

If I go to Vegas and play Blackjack and the dealer cheats you can't say, "Well, it's your fault for choosing to gamble."

That analogy doesn't work though. It would have to be:

If I go to Vegas and the terms at the table are that the dealer takes a really big unfair percentage, and I agree to it when I sit down at the table...

In which case you maybe can say it's your own fault.

Or else you'd be implying that publishers are actually cheating, i.e. breaking their own contracts.

Patrice Fitzgerald said...

Thanks to the lawyers and law students chiming in here about unconscionability and contracts of adhesion. The basic business practices within traditional publishing are such that these laughably unbalanced contracts are the norm -- and realistically, a lawyer can't do too much with them for the average new author. (I'm a lawyer and a writer, and I've observed this incredible inequity for years.) Once you're Stephanie Meyer, you might have some clout.

It comes down to writers wanting to write. And wanting their books to be read. Until now, there weren't any options for getting your books out to the readers except through traditional publishers.

Anonymous said...

Reading your blog has taught me more than one writer group that kept that information away from the unpubbed. We didn't need to know was the feeling I got with that.
That never set well with me. I needed to know the bones/the dirt/the true story of what really happens in the publishing world.
You, and the other wonderful indie bloggers, have taught me more than so many years in that unnamed group.
Reading about the contract shenanigans makes my blood run cold.
If I ever decide to pick up my writing again, you can bet I won't go the route of traditional publishing.

This post scared the bejesus out of me as much as it educated. Yay for that.

Thanks for sharing and educating. I greatly appreciate it.

xdpaul said...

Jeff, the analogy works fine. Your revision basically refines it to: don't gamble.

Which, in this analogy means, "don't write."

Refusing to participate in any business that could conceivably be exploited is a terrible solution. By the example you give, there should be no books, no food and no raw materials. After all, nobody is forcing farmers to harvest, miners to mine or writers to write.

Joe Konrath said...

If I go to Vegas and the terms at the table are that the dealer takes a really big unfair percentage, and I agree to it when I sit down at the table...

That's probably a better analogy, but the average player should think they have a chance. Something like Keno, which seems like you have a chance when you really don't.

T Ludlow said...

PolyWogg said...

"The author does have a choice -- do something else. The other examples you use (child labour, etc.) are not choices -- the alternative is extreme poverty and death instead of abject poverty and exploitation."

I would say the analogy is apt, the only difference is the seriousness of the consequences, the degree of harm entailed in walking away from a bad deal.

We also have to be careful when laying down what is a 'necessity' or not. We could say that the child labourer is not entitled to shoes or an education, these are not necessities either.

xdpaul said...

And Joe, I'm hoping my dream becomes one of those exploding raisins at the end of the poem.

Yes, I'm only semi-literate: I always misread Langston Hughes' best work as being about a variety of strangely behaving, disgusting raisins.

Your retort, in any case, made me laugh. Never heard "eat the raisin" as a viable solution to thwarted dreams before.

Jeff said...

That's probably a better analogy, but the average player should think they have a chance. Something like Keno, which seems like you have a chance when you really don't.

Just to clarify my position, I'm pretty sure I agree wholeheartedly with your underlying philosophy, Joe. Authors have been getting the shaft for years, and change is long past due.

It's just that through a legal lens, it's hard to say with certainty that authors should be released from their awful contracts. There are a lot of factors to weigh.

I think the most justice-friendly solution is to circumvent trad-pub entirely, and in doing so demonstrate that ridiculous contract terms will lose publishers money. Authors like you are showing publishers just that.

@xdpaul: Well... everything you said was wrong, basically.

Anonymous said...

In legal terms, any contract willingly entered into is deemed to be fair

I used to believe this, until I read Joe's recent post about Harlequin and their creative "licensing" of author copyrights. It seems very similar to what the movie studios have been doing.

I'm not a lawyer, but I am an accountant, and I understand how you can create a shell corporation and "license" something (a copyright, a trademark, whatever) to your own corporate subsidiary for peanuts.

So it's like this: I sign a contract with Shady Publishing, who promises me 50% of the royalties from my copyright. Wow! That sounds awesome, right?

Oh, but Shady Publishing just "licensed" my copyright to another corporation for a pittance! Gosh, I neglected to read the fine print on that one. Did I mention that the licensee is a corporate subsidiary of Shady Publishing?

No? Well, here's the deal. We are using creative accounting to screw you out of your 50%! Our corporate subsidiary isn't required to issue financial statements, either--so you'll never really know the depth of how much you got screwed.

But thanks for playing!

-Christy

Jill James said...

Wow! That's all I have. Wow!

dhendrick said...

I just keep trying to figure out when Joe finds the time to write anything besides this blog! LOL

SC Lawyer said...

The harsh reality is that any lawyer who writes a contract for someone will always write in favor of his or her client, but with the understanding that it must be enforceable. That brings up issues like whether there was consideration and whether the provisions are unconscionable. But these legal concepts provide scant protection for the individual who is not in a position to truly negotiate the terms of a contract. I have represented individuals who signed such boilerplate contracts (not authors, but these types of contracts are everywhere). Once they come to me and I explain what they signed, it is heartbreaking to see their faces. Most people do not even read their contracts and most certainly do not understand them. Have you ever read your mortgage agreement? Almost no one has until things go south and they go to a lawyer who does read it and explains to them what they signed and that, by and large, the courts will enforce what they signed.

I have never represented any authors, but I can almost guarantee you that very, very few of them understand what they sign with publishers any more than the average person understands their mortgage agreement beyond how much their monthly payment is and by when it must be paid.

You hit it right, though. What authors must do is to assert themselves as a group. They must demonstrate to the publishers that it is the publishers who need them or they (the publishers) will go out of business. That will put the authors in a better position to be able actively to negotiate their contracts rather than be forced to accept the boilerplate harshness the publishers foist upon them.

Anonymous said...

Joe, I discovered your blog last week through SF Signal. I have learned so much from you in that week, and I can't even express adequately how grateful I am to you. I have been researching for the past two months the pros and cons of self-publishing and found far more pros than cons, but haven't given much thought to legacy publishing other than a vague notion that someday I'd turn a manuscript in to one of the Big Six. Because of you, I'm shelving that notion and setting my sights strictly on self-publishing.

The digital revolution, I think, is becoming a boon to writers. Because of that, we all have the power to tell the Big 6 to go to hell. Yay for us writers!

Aitch748 said...

Oh. My. Freaking. God.

You know, I'm in my forties and I've had this on-again, off-again desire to organize my Walter Mitty fantasies into a salable novel. I've thought about being a published author since I was a teenager, but I never really drove myself to finish a manuscript that readers would pay to read.

But this article actually makes me GLAD I never got published. Good Lord.

Kiana Davenport said...

Joe, thanks for todays' blog, illuminating, smart and informative as always. I wasn't going to comment, becoz I am a casualty of this whole Big Six mess, my book contract having been terminated by Penguin, and I have written about it ad nauseum. But I wanted to warn writers about agents.

Even the best of them will always side with publishers, because publishers are their source of income. When you sign with an agent, READ THE FINE PRINT! Even if your contract is per-book. Becoz 9 times out of 10 you will owe them their 15-20% commission on earnings from your book FOREVER.

And should the agent die, you will still be paying their estate 15% of the earnings from your book. Again, FOREVER. Even if you, the writer, dies, your estate (or heirs) will be paying their estate (heirs) that commission until we all turn into global dust.

My advice, ask for a contractual time-limit on the agent's commission per book. Maybe Joe covered this and I missed it. Agents are important, they give you clout if your dealing with a publisher (even Amazon) they work for higher advances and better royalty rates. Just remember, they're in it for the money, too. So please read the fine print in each agent contract!

PS...my former agent was established and respected in all publishing circles. She was a good agent, always supportive, and a good editor. But when Penguin terminated me, when I refused to kowtow to their demands, she essentially told me Sayonara! and went over to their side.

A good lesson. I didn't hang myself, I just got smarter and a little tougher. So remember, as excellent as agents are they must, by nature, work both sides of the street. Protect yourself. Push for time-limits. Read the fine print! Good luck!

Kiana Davenport said...

@Joe...are you able to tell us if you have a commission time-limit per book in your contract with your agent?

PS...I loved the second Timecaster cover!

@Ken Hansen. 85% royalty rate???? OK, now tell us who your publisher is.

Hairhead said...

To Anonymous at 1:05, and to Poly, both saying, "You had a choice."

BULL BULL BULL BULL(repeat 80,000 times, once for every word in a typical genre novel).

The very basis of contract law is the underlying equality of the two parties. Equality is measured in a number of ways; let's count a few:

1) Both parties can walk away from the table with equal consequences. Writer walks away, can't publish, loses income and dream. Publisher walks away, to the next in a lineup of hundreds of eager, naive suckers.

NOT EQUAL!!

2) Both parties may contract with others providing the same services (publishing) or goods (books), negotiating a different contract which is good for them, or giving up some things. Let's see: Writer goes to another publisher, new publisher offers virtually the same contract, writer can't get anything he wants anywhere else. Publisher goes up to another writer offers the same contract, or a contract with even worse terms for the writer, and the eager writer signs.

NOT EQUAL!!

3) Both parties suffer the same degree of exposure and/or consequence for non-performance. Let's see: Writer refuses to submit 2nd or 3rd novel in a series, publisher demands full advance back, writer is penniless, eats dog food, other publishers avoid him or her. Publisher refuses to provide prompt, clear royalty statements in a manner described in the contract; writer complains, publisher completely ignores writer, or tells him to screw off, with no consequences.

NOT EQUAL!!!!

Open your eyes, you boobs; you're a mouse, kicking an elephant in the ankle and telling the other mice that you and elephant are equal.

Tracey said...

There are many factories in the poorer Asian areas (we call them sweatshops) where people willingly sign contracts to work for the unfair conditions (long hours, poor pay, and often unsafe working conditions).

While some do it because they have to, many of the workers (mainly women) choose to work there even though they have husbands bringing home a paycheck that will cover rent/food (just).

So why? Why would they still sign up to these conditions if they didn't have to? It's *usually* because they have a dream to send their children to university/colleges and give them the life they didn't have.

They are not forced to stay, and in some of the factories there are waiting lists to work there due to demand.

But for the dream of a better life for their children they endure the conditions.

I've only had two published contracts for books, both of which I was unhappy with (actually the first I was thrilled with because it was my first REAL CONTRACT - but that soon faded after I got my first royalty statement).

But it was a way to meet my dream then.

Now I thankfully live in a time where contracts are no longer needed to get published. I'm one of the lucky ones.

Jeanne Miller said...

Joe et. al, You will be happy to know that many writers are now becoming educated. Thanks to your blog, as well as those of Dean, Kris, Passive Voice, etc., there is now so much information out there that writers can make informed decisions..and they are.

I belong to a writers forum...no, not the mean one with the psychotic mod who constantly bans self-pubbers...the good one. Kindleboards. I'm seeing more and more threads of authors who have been approached by some of the big publishers and are walking away and not signing. They have found they can make more self-pubbing then what is currently being offered in contracts.

There is one I felt so bad for as he was selling hundreds daily with a series. He was rising fast in the rankings, so of course a big publisher was interested and approached him. They insisted he pull his books off sale while they negotiated. He didn't want to as he would lose a lot of income. They insisted. Well, after a couple of weeks, they finally made their offer and it was not enough to entice him to sign. So he walked away...but lost a lot of income.

So not only, do they try to lowball you on the contract, they are costing you a fortune just to negotiate terms. Shameful.

Thank you so much for this blog.

@Kiana...so many of us were horrified at what you were going through. I just happened to go to your site the other day and I'm so happy you found a publisher who will treat you with the respect you deserve. Best to you.

A. Yamina Collins said...

Hi, Joe, Sorry if you answered this question elsewhere already but...considering your reservations and experiences with publishers, I don't understand why you continue to work with publishers. Am I missing something? Why not just go self-published full-on?

I am curious because I have started my own publishing company and my first book of short stories comes out in June.

So why do you keep using other publishers?

Again, I apologize if you answered this somewhere else. I read the post, not most of the comments.

RD Meyer said...

I think a lot of it comes down to arrogance and stubbornness - arrogance from knowng that writers usually just want validation, for someone of authority to say they find the author's work to be of passable quality, and stubbornness in not really believing the market could leave them behind. After all, it's their world, and how dare we unwashed masses think that we could possibly control our own destiny.

My guess is that in 15-20 years, when they survey the wreckage that was once traditional publishing, they still won't understand where it all went wrong.

T.L.S Clarke said...

Joe

I am curious where the Amazon imprints stand in all this?

Any thoughts on their clauses, contracts and terms?

Stuck in the Stone Age said...

Why don't publishers offer better royalty rates? Because they all use the same inefficient old business model, with an excess of staff. Just think about all of the people they must employ:

Accountants
Artwork coordinators
Book keepers
CEO
Distribution analysts
Drivers
Editorial assistants
Editorial director
Editors
Graphic designers
Human Resources team
Indexers
Interns
IT team
Marketing administrators
Marketing assistants
Marketing coordinators
Marketing director
Packing team
Post room staff
Production assistants
Project managers
Proofreaders
Publicity assistants
Receptionists
Royalties staff
Sales force
Secretaries
Warehouse staff
Web site designers

And that's probably only the half of it. They're bleeding money with all of these people on payroll. So why offer an author a bit extra, when you've got all these other people to feed?

Self-publishing: it's the way of the future. I think that in a couple of decades we'll all look back and laugh about how so many authors suffered through so many rejection letters when there was such a better solution.

Ken Hansen said...

"@Ken Hansen. 85% royalty rate???? OK, now tell us who your publisher is."

Hi, Kiana. I'm the publisher at Tekstloftet, a small publishing company aimed at helping authors who don't have the time or interest in doing other than writing, or authors who want to get their old books published as e-books.

Rob Cornell said...

Jen Talty said...

Writing isn't about getting to a publisher, but getting your book to the readers.


Bingo! It seems like such an obvious concept, but those of us who grew up as writers trying to break into NY had to become so focused on getting published, the poor reader became an afterthought.

Very glad things have changed.

T.A.K. said...

Here's my 2.5 cent armchair amateur psychology.

The average publishing professioal does not intend to exploit or offer unfair conditions. But, I am fond of quoting something my contracts professor said about judges: "Anyone whose ass is kissed that often will start to think it is holy."

This is my explanation for a lot of arrogant behavior. It certainly helps explain how literary agents have treated me back when I was represented by agents.

wannabuy said...

@Joe: "As more authors wiggle their way out of multi-book deals and self pub, you can expect this clause to appear soon."

I really hope authors do not sign such contracts. What I cannot believe is they own the author's name...

If the contract were more fair, sign. Otherwise, why are you paying for someone to work in a fancy building in a city almost certainly more expensive to live in than your own?

Neil

Anonymous said...

I'm the publisher at Tekstloftet, a small publishing company aimed at helping authors who don't have the time or interest in doing other than writing, or authors who want to get their old books published as e-books.

I didn't see a website for "Tekstloftet"--just a Facebook Page and a free blogger account that was written mostly in a foreign language.

You probably should have mentioned that your "85% royalty rate" isn't a rate you are earning yourself, but something that you are trying to self-promote using Joe's blog.

Not very classy.

Anonymous said...

Joe -- feel free to delete this, as it is wildly off-topic. I'm hoping you will find time to comment on the demise of Houghton Mifflin. First of the dominoes?

T.A.K. said...

Anonyous, they filed for chapter 11, debt restructuring, not chapter 13 bankrupcy. This isn't necessarily the demise, if they are smart about how they restructure.

TK Kenyon said...

Joe,

You're darn right. I love SF, but the Ace Timecaster cover is generic. It looks like space opera or mil SF. Your cover: fantastic. I'd pick it up in a heartbeat.

TK Kenyon

Shod N Froyda said...

MUHAHAHAHAHA!!:

http://www.digitalbookworld.com/2012/authors-dissatisfied-with-publishers-new-survey-says/

"Asked whether they would ever consider cutting out their publisher altogether in favour of e-publishing, only 26.0% of authors responded, ‘No, I would always want a publisher to guide me.’"

Guillaume Wolf "Prof. G" said...

Hi Joe& all,

Thank you for the great post.

It so happens that in my book on reinvention and creativity, reDESIGN: reCREATE, I talk about the phenomenon of the publisher behaving like a “Big Daddy” — and I ended with the same conclusion: information is power.

Here’s a small passage:

“In the old model, the Creative was a bit like a helpless child, looking for the protection of a powerful “Big Daddy” (the publisher/investor), who controlled everything commercial — leaving the Creative only focused on his/her craft. Great model? Not so much. The problem was, more often than not, that “Big Daddy” was not acting like a caring parent, but behaving like a dominating, exploitative sibling. The record industry is a great example of that — filled with horror stories. The relationship was patronizing and characterized by a “We know better than you” attitude. A typical phrase would be, “Let us handle the commercial part of the equation; we know what’s best for you” (by the way, if someone says that to you, watch out!). In this dysfunctional relationship, the Creative played the role of the child, indeed.
But now that “Big Daddy” is gone, now that the old model of “being taken care of for life” is gone, too — what position should you play?

The shift to creative power.
By now, you know that I am big on the concept of responsibility. As you remember, I told you the secret mantra: “I’m responsible for my creativity” (see Part 1 – 28). I already wrote it down three times in a row to make sure you couldn’t miss it. Throughout this book I’ve tried to convey that in your process of reinvention, you’re the one in charge.
Here’s the deal: If you really, really, really want to be successful with your creativity, you have to leave “the child” behind and grow up into a full creative adult (the one that you are) by operating what I call the Shift to creative power. It’s vital. The world is changing, and your Creative Self has to change along with it.

Shifting to creative power by taking full responsibility means learning everything you can that relates to your field in addition to your talent: from production and promotion to sales and distribution (see Part 1 – 25).”

Excerpt from reDESIGN: reCREATE http://redesignrecreate.com

. . .

I just want to add that it’s very important to understand that every contract in the world is negotiable. Sounds hyperbolic but it’s true. Nothing is ever written in stone.

The key is to have leverage.

But how?

By slowly building your brand and creating a community of fans, and by having a superior product.

An example from the music industry comes to mind. The electronic band Daft Punk signed their first album with Virgin—BUT—they signed a very unique deal where Virgin acted as a manufacturer and distributor only (not a publisher). Daft Punk took charge of the production of their music but also of their videos.

But how did they do it? How did they get the deal?

First they were smart and confident. They had already self-released their titles independently and had proven they had a solid fan base. Once you have a strong following—you have leverage—anything is negotiable (I talk more about this in the book; but you get the idea).

Interestingly, I saw numerous bands from the same era who signed legacy deals (shiny objects) and now they’re all gone.

As authors we can all learn from the music industry. Learning both from the bad and the good as well.

We’re entering a new era of creativity, discoveries, and surprises that’s accelerated by the ease and availability of creative tools. There’s a global movement of reinvention and creative expression bubbling—and Joe, you’re one of the powerful voices of this revolution.

Thank you for speaking out loud.

Cheers,
Guillaume Wolf “Prof. G”

Author of reDESIGN: reCREATE http://redesignrecreate.com
and The Last Arakad http://www.arakad.com

Ken Hansen said...

Anonymous said: "I didn't see a website for "Tekstloftet"--just a Facebook Page and a free blogger account that was written mostly in a foreign language.

You probably should have mentioned that your "85% royalty rate" isn't a rate you are earning yourself, but something that you are trying to self-promote using Joe's blog.

Not very classy."

It was not meant as self-promoting, and I do not want to turn this into an argument on Joes blog.

The language is norwegian.

I merely wanted to inform on Joes statement: "I have never heard of a case where a Publisher offers an Author better royalty rates."

And then I replied to an answer.

Ken

Joe Vasicek said...

Interesting post. The way the industry rips writers off reminds me of this:

http://www.youtube.com/watch?v=iQZKq1hgfF0

Sam said...

Thanks to Amazon Prime, in the past month I finally watched Ken Burns's "Baseball" and "Jazz." A common theme is how the big-money people who control distribution (stadium and venue owners, promoters and booking agents) screwed over the player and artists, who provided the product. Baseball owners colluded for over 100 years to control the players and keep salaries low, before they were forced to allow free agency. Things run parallel in every business, including publishing...

Anonymous said...

Marketing administrators
Marketing assistants
Marketing coordinators
Marketing director

"Marketing" -- THAT's a laugh! All marketing ever says is "We don't know how to sell a book like this."

Gee, thanks, guys. If I told MY boss I didn't know how to do my day job, I'd be fired.

Anonymous said...

TAK -- Thanks for your comment. How well Houghton Mifflin survives Chapter 11 restructuring depends largely on what kind of financing they are able to develop in response to revisions in their operating plan.

If the investment community believes that traditional publishing as a business class has a downward trajectory, it will be hard for an individual publisher to find new sources of credit.

This was the case with Borders. They could rotate CEOs all day long, but no banks or venture capitalists stepped in, once the stink was on.

I wish HM no ill will and take no joy in their troubles. But I would not be surprised to see HM fail at restructuring and see others follow.

Jon Olson said...

Self-what?

Kiana Davenport said...

@A. Yamina Collins...you ask why Joe continues to publish with a publisher (an Amazon imprint) as well as self-publish. I can't answer for Joe, but the reason I too have chosen to go that route (Amazon's Thomas & Mercer) along with Joe, Barry Eisler and many other writers, is becoz of Amazon's incredible marketing clout.

We all know the debilitating amount of time and energy it takes to promote our own books by blogging, interviewing, social networking in general (which I am dismally bad at). With Amazon, all they do is push a button, and your book is marketed GLOBALLY. Joe has detailed this in earlier blogs. Good luck!

Griffin Hayes said...

Thanks again for a great post Joe!

I think it's pretty clear by now that publishers are hard at work trying to convince authors there's only one legitimate road to getting your book into reader's hands. Fact, they've spread so much fear about 'ruining your career by self-publishing' that it took a good friend of mine several months to convince me to take the leap.

Not trying to be controversial, but authors on the legacy side of the debate seem to have a touch of battered wife syndrome. They know they're being mistreated (as Joe often points out), but they've been pumped so full of fear they can't escape.

mbelcher said...

As always a breath of fresh air. Thanks Joe for being out there waving the flag and sticking your head above the parapet.

Someone has to.

Great post and gives newbies like me real confidence to keep writing and not worry about all the crap.

Matt

Anonymous said...

Joe, here's another example of why self-publishing is the way:

Today, I got a query letter from a legendary agent, which told me my book "has potential."

And to think, it only took THREE YEARS for me to get that reply back, after said agent requested my full manuscript.

Amazing.

Thank goodness it WASN'T responded to sooner. I might've gotten a traditional publishing deal back then. Instead, I'll be epublishing this summer.

Carey Conley

Clarisse Thorn said...

Re: the "until it's out of print" clause. My understanding is that Alan Moore, the author of classic graphic novel Watchmen, accepted a contract for the book that said he'd get the rights back when it went out of print. He accepted the contract because in those days, comics ALWAYS went out of print within a year. Obviously, Watchmen did not. You can find a lot of Moore's rants about this around the Internet ....

Conrad Powell said...

Hi J.A. Konrath: I am an Intellectual Property Attorney/ Author (The Vampire Redemption Series amazon.com/Box-Set-Vampire-Redemption-ebook/dp/B0072LXR8C)
in regards to this clause in your contract:
"Books 1, 2, and 3 will be held in a joint and open account, and Publisher shall not pay Author's share of royalties and subsidiary rights income on any Book of the Work until Author's share of royalties and subsidiary rights income for all Books exceeds the total advance."
The proper legal term is call "Cross Collateralization" and it is the phenomenon as you described where a publisher wants to connect all accounts for all works published through them so they will have the right to collect any and all outstanding proceeds for advances from any and all projects and that no payment will come to you until they have recouped from any and all projects for advances granted for any and all projects. You must fight to exclude such a clause from your agreements. This clause is the reason an author or musician can sell very well and end up bankrupt even owing the publisher/record label. There are so many examples - Lisa, T-Boz and Left-Eye were bankrupt because of this. I agree that unless you have serious bargaining power in that they really want you and thus will leave the clause out, the clause is a must from their perspective. It is this clause that causes them to "own" you more than their funny accounting practices. One way to combat this clause is to include "Escalations" in your agreement. With escalations, the publisher will agree to increase royalties based upon certain minimum thresholds achieved. Let's say 0-5,000 books sold $1.50/book royalty rate . 5,0001-10,000 - $2.50, 10,001-20,000 - $2.75 and so on. This will net you more money to offset the cross collateralization. Also, you need to have a clause that caps expenditure or at least expenditures beyond a certain amount should only be undertaken with the mutual consent of the Author. Of course they will fight hard to have total control but as long as you say that your consent won't be unreasonably withheld, you should get through. There are so many ways to properly balance the unconscionable contracts but they are too many to mention here. Okay keep up the good work, J.A. you are my hero and the biggest reason I started to self publish ebooks. You gave me advice I just figured I would return the favor. I would love to be a guest on your blog dispensing with these legal questions that so many want to know. Perhaps we can collaborate on some legal guide that I have been meaning to write for some time. Okay contactmylawyer@gmail.com

Walter Knight said...

Braille? Nice to know.

Have you ever wondered why scuba divers fall backwards from the boat into the water?

Duh, if they fell forward, they would still be in the boat.

Michelle Gordon said...

Thank you Joe, for a very interesting and informative post. I decided to self-publish because I lack the patience it requires to publish traditionally. I also love the process of publishing my own books, being able to choose my own covers, titles, subjects and use my own name!
I must admit I had no idea what a traditional contract entailed, and I am now very grateful that I was never in a position where I had to sign one, because I know I would definitely have regretted it.
Thank you also, for being such a successful author, it's certainly inspiring to know that a living can be made doing what I love.
Now back to the proofreading!

Mira said...

Joe this is such fantastic information.

You are doing a great service for writers. I truly support you!

Thank you!!!

Robert W. Walker said...

Anyone need to hear it from a guy who has been fucked over for 30 years, come see me. Thank Joe everyone for putting out the facts all in one place. For how many decades has this been known in bits and pieces, also known by the agents who supposedly WORKED for the writers, HA!

Rob Walker
Instinct INK books
www.robertwalkerbooks.com

Cherise Kelley said...

The Author shall submit the completed manuscript or a synopsis and first two chapters of such work to the Publisher before offering or submitting same to any other party. The Publisher shall have a period of thirty (30) days after submission of a full manuscript of such work, or ninety (90) days before the Publisher’s first publication of the Work hereunder if a synopsis and first chapters are submitted, within which to notify the Author whether it desires to publish such work.

May I suggest a way out?

This does not say the author has to submit each new manuscript under her own name. Send it in to the slush pile and let them sit on it for those 30 to 90 days. After that, self publish it. File a "Doing Business As" license for the pen name you send it in under beforehand, just to cover your butt.

Steve Holak said...

I've got a great idea for a thriller plot: A self-published author begins an online blog crusade against the evil legacy publishing industry, exposing the industry's collusion and exploitation of authors. The publishers strike back by hiring an assassin to take him out.

Jennings said...

Wow, this was an eye opener! I just found your blog yesterday, and this was amazing to me. I knew it was skewed, but the numbers and contract clauses... yikes. I have been querying an adventure novel which has gotten excellent feedback from two dozen (non-relatives!) beta readers, but had taken a break while I was out of the country last month. This makes me rethink my whole approach! (I've sent it to my husband who has an industry guy putting together a non-fiction package. He got a HUGE advance for someone, and my husband ghost wrote half the book for a song, and now he wants him directly... but the percentage sucks.)

I am writing a novel that an agent requested, although it is a whole new genre for me and I'd already decided that, if she can sell it, I'd use a pen name for that "brand." I'll keep working with her unless that falls apart, but otherwise, I am really seriously leaning towards self publishing. Thanks so much for the info! Keep up the good work.

Anonymous said...

Just found this blog. Thank you for this, Joe. I feel like I've been given a Get Out of Jail Free card.

My own Very Big Agent couldn't sell my first book, and she says it's a travesty but what can you do? But she said, don't take it away. Give me another one. So I did. She doesn't know how to sell it. So, does this mean I can have my first book back? Or will she send it to smaller publishers this time? No, and no. "Dear newbie writer, just write me a guaranteed best seller and make my life easy, okay? And then these other ones will sell. You don't want to Ruin Your Career now by self-publishing or going to a smaller press. Stay with me as I do nothing for you for years..."

Oh and this is the second agent I've had. The first one is a real horror story.

Shall I mention I've been all through this before, as a screenwriter. My film agent had a breakdown and left the biz. No wonder my calls weren't being returned.

Big Publishing is dead, just like Big Hollywood. At least for everyone but the A-list. I've had it with the gatekeepers. I'm spending the rest of the summer learning everything I can from everyone I can about e-publishing.

halfandhalf said...

hey i'm a young writer and me and some friends are writing a book about haf deimgods and half wizard children are there big do's and don't to getting inprint for a first time? (What do you think of the idea?)

CryHavoc said...

The more that I read on this specific topic, the more convinced I am that e-Pubbing with Amazon and SmashWords was the right way to go. I really haven;t sold that many books but I have ALL of the rights to the material published. I have been writing for nearly ten years and I enjoy it. Perhaps in a few more years I may sell more books...or not... The one year of time I wasted looking for an agent taught me one hell of a lot... My eight book will be out soon! :)

why is this all in Czech!? said...

How does submitting an mms under a pen name help? And can someone clarify what's RWA?

Better still, can someone tell me how you get into writers' communities and find authors' blogs to help spread your own self-published works?

Because unless and until we find a way to market ourselves successfully - and that's damn hard for an unknown author who self-publishes - we're going to continue signing those unfair contracts.

I haven't published yet - still editing my first ever novel before submission - and this article just scared me half to death :( But what is the way out? Unless and until you sign yourself to one of these contracts and at least get out there, self-publishing sounds like a bad option to me.

why is this all in Czech!? said...

How does submitting an mms under a pen name help? And can someone clarify what's RWA?

Better still, can someone tell me how you get into writers' communities and find authors' blogs to help spread your own self-published works?

Because unless and until we find a way to market ourselves successfully - and that's damn hard for an unknown author who self-publishes - we're going to continue signing those unfair contracts.

I haven't published yet - still editing my first ever novel before submission - and this article just scared me half to death :( But what is the way out? Unless and until you sign yourself to one of these contracts and at least get out there, self-publishing sounds like a bad option to me.

Lisa Fender said...

I loved this and it says it all! Based on this information (that I learned a long time ago) I decided to self-pub. I figured between the royalty payments and having to do all your own marketing anyway, I might as well. I don't need a publishing house's name on my book. I will still be published and I believe my book will catch on and it won't matter whether or not I have a Pub house. Thanks for the article, I love it!

debra said...

I just sued Llewellyn Publishing, who publishes my 3 books. I'm waiting to hear the arbitrators ruling hence I can't sleep and am up at 2 am rereading this blog. I represented myself and went through fast track arbitration through the AAA. This Blog post is the best one I've read on the internet summing up the insanity of what authors put up with. It's the only one that really makes sense. I'm not going to take this crap any more. I've worked too hard. I know my readers don't expect me to use words like "crap" but that's what we've been handed, and handed it with a "You are so fortunate we are giving you crap". My publisher has earned over 700,000 from my books. I've earned 70,000 and they are cheating me on my ebooks, paying me late, not providing statements, breaking promises and withholding money from Borders Bankruptcy even though they were paid a month before the bankruptcy. They told the arbitrator even if they get to keep that money, they will not pay the authors. And I am the bad one, the only author they say who has ever complained and am ju

debra said...

Hey I won! Got all my rights back and ruling they should have paid me 50 percent for ebook. Arbitrator ordered: 7000 for ebooks, 2300 for cost of partial audit I did due to lack of timely payments and reporting, and 25,000 punitive damages. Justice has been served and now looking at what I want to do next. Thanks everyone for your support!!! I'm not even angry anymore.:)