There are certain folks in the industry whose actions I don't like. And I'm often vocal about that.
But disliking what someone does or says doesn't mean disliking the person. And disliking how an organization conducts itself doesn't mean I dislike the organization, or the members.
I simply want those members, and their organization, to stop harming authors.
So when I read the latest letter from the Authors Guild to their membership, my immediate reaction was sadness, not anger. Why don't they understand how they are harming the very authors they purport to protect and defend? Why can't they see the side they're taking is the opposite of what the majority of authors actually need?
There is some of Pournelle's Iron Law in play, of course.
There's Bookholm Syndrome.
There's Konrath's Law (folks would rather defend their beliefs to the death rather than admit they might be wrong.)
There's also self-preservation, and the ignorance it breeds. If you listen to an opposing point of view that makes sense, you must confront why you aren't acting on the point of view. So it is much easier to ignore it, or disregard it.
As Upton Sinclair said, "It is difficult to get a man to understand something, when his salary depends upon his not understanding it."
Which brings us to Amazon vs. Hachette. Those who need a primer can start reading my blog post from May 24 and just keep reading until present. I link to many relevant posts and articles about the subject.
So what did the latest Authors Guild letter say? I'll repost it here. My comments in regular font, AG ridiculousness in bold italic.
I also want to invite any member of the Authors Guild to post in the comments, or email me, and explain where I'm wrong. I don't hate you, I won't attack you, I won't censor you. My readers and I want to hear you defend yourself, or the Guild. If we can get a dialog going, we can learn from each other.
The Authors Guild’s mission, since its founding in 1912, has been to
support working writers.
All working writers? Or just the upper echelon writers who kowtow to legacy publishers?
All working writers? Or just the upper echelon writers who kowtow to legacy publishers?
I have taken the AG to task for this numerous times (often with assistance from Barry Eisler), and we've gotten no response.
Barry and I don't do this because we enjoy shaming authority figures. We truly want the Authors Guild to actually do what it said in that opening sentence: support working writers. But not just 1% of them. All of them.
Here are some previous posts that show bad AG behavior:
Those above examples, and the many more those posts link to, show that the Authors Guild doesn't have the interests of the majority of its members at heart. It cares more about rich authors, and protecting the status quo.
The fact that no member of the Guild has responded to the many accusations that I, and other working writers, have leveled at it, is extremely troubling.
The Guild has consistently opposed Amazon’s recent and ruthless tactics of directly targeting Hachette authors, which have made these authors into helpless victims in a business dispute between two big corporations.
For the eyerollingenth time, Amazon isn't targeting Hachette authors.
The Guild has consistently opposed Amazon’s recent and ruthless tactics of directly targeting Hachette authors, which have made these authors into helpless victims in a business dispute between two big corporations.
For the eyerollingenth time, Amazon isn't targeting Hachette authors.
Amazon is negotiating with Hachette. Hachette wants to control the retail price of ebooks, and prevent Amazon from discounting. Hachette illegally colluded with other publishers in order to do this.
Amazon and Hachette no longer have a contract. Amazon is under no obligation at all to continue to sell Hachette's books. It is certainly under no obligation to sell them while also giving them perks such as warehousing, pre-order buttons, and discounting.
Can anyone at the Authors Guild, or Authors United, give me an example of how Amazon is supposed to negotiate without any leverage?
A contract involves two parties trying to get what is best for them. This is called business. It isn't targeting authors, or engaging in censorship, or boycotts, or sanctions, or disappearing authors, or any of the other nonsense that AU and AG are whining about.
Authors are indeed being harmed. But they aren't the target. Hachette is the target. Authors are collateral damage, and Amazon has tried, THREE TIMES, to compensate authors during this negotiation. But Hachette doesn't want to do that. Neither does the Authors Guild, or Authors United.
And the Authors Guild wonders why many authors call them the Publishers Guild?
These harmed authors have no contract with Amazon. Amazon doesn't owe them anything. Amazon never promised them anything.
These harmed authors have signed contracts with Hachette. Hachette is supposed to exploit the rights they bought. That's the main reason authors accepted all of those shitty contract terms. Hachette gets those rights for the life of the author plus 70 years, pays low royalties, doesn't allow authors to publish competing works, and in return authors get widespread distribution of their work to sell to as many customers as possible.
But Hachette is unable to come to terms with the biggest bookseller on the planet.
Why aren't these harmed authors angry at Hachette? They're not living up to their end of the deal. Has the Authors Guild even asked Hachette what's going on? Has Authors United?
Let me make this even easier to understand.
I sign a contract with a landscaper to mow my lawn.
The landscaper needs a lawnmower to do this. But the landscaper has been haggling with the lawnmower dealer for eight months, and still hasn't gotten a mower. And all this time, my lawn isn't being mowed.
Do I get mad at the lawnmower dealer?
Of course not. That would be ridiculous. It isn't the dealer who is preventing my lawn from being mowed. It's the landscaper's fault. He promised to cut my lawn, and it isn't getting done. He's the one I signed the contract with.
Now let's take it a step further. I live in a townhouse, so I'm part of a townhome association. It isn't only my lawn that isn't getting mowed, it's all homes in the neighborhood. The townhome association needs to do something. That's what we all pay them to do. They need to step in and fix this.
Should the association:
a) Talk to the landscaper and try to force him to settle his differences with the lawnmower dealer, so he can then cut everyone's lawns like he is contractually obligated to do.
or
b) Ask the government to force the lawnmower dealer to sell its lawnmowers to the landscaper under the terms the landscaper wants.
Why can't the Authors Guild see how ridiculous this situation is?
This action has caused thousands of writers to see a significant drop in their royalty checks.
I have to point out, yet again, that Amazon offered to compensate authors monetarily during the negotiation period.
Why isn't the Authors Guild pressuring Hachette to accept this offer?
Quote AG prez Roxana Robinson:
“But this seems like a short-term solution that encourages authors to take sides against their publishers. It doesn’t get authors out of the middle of this — we’re still in the middle.”
Actually, Roxana, Amazon's offer DOES get authors out of the middle of this. And authors SHOULD be taking sides against Hachette, for not only getting them into this mess, but also refusing to compensate them as Amazon offered.
How could she say that with a straight face, let alone believe it? And why didn't the reporter who took that quote point out how stupid it is?
Here's another analogy to make this simpler to comprehend.
Godzilla and King Kong are duking it out on the streets of NY. Citizens are getting trampled, and their property is being destroyed.
Godzilla says, "If King Kong agrees, we'll move all the people out of harm's way, and each chip in half for all the damage we cause."
King Kong says, "Nah."
And we should blame Godzilla? Seriously?
The Authors Guild challenges this threat to the literary ecosystem, one that jeopardizes the individual livelihoods of authors.
I'll opine that the business threatening the livelihood of authors is Hachette. It falls on Hachette to make its authors' books available in as many venues as possible. It's failing to do that.
What the Authors Guild could be doing is providing lawyers to unhappy Hachette authors to get them out of their contracts, so these authors could then self-pub.
The Guild started its own initiative to invite governmental scrutiny of Amazon’s outsize market share and anticompetitive practices in the publishing industry. Last summer the Guild prepared a White Paper on Amazon’s anticompetitive conduct, circulating it to the United States Department of Justice and other government entities. As a result of our request for the initiation of an investigation of Amazon, we hosted a meeting with the DOJ in our offices on August 1 so that a group of authors could make their case directly to the government, as the Wall Street Journal reported today.
Authors are indeed being harmed. But they aren't the target. Hachette is the target. Authors are collateral damage, and Amazon has tried, THREE TIMES, to compensate authors during this negotiation. But Hachette doesn't want to do that. Neither does the Authors Guild, or Authors United.
And the Authors Guild wonders why many authors call them the Publishers Guild?
These harmed authors have no contract with Amazon. Amazon doesn't owe them anything. Amazon never promised them anything.
These harmed authors have signed contracts with Hachette. Hachette is supposed to exploit the rights they bought. That's the main reason authors accepted all of those shitty contract terms. Hachette gets those rights for the life of the author plus 70 years, pays low royalties, doesn't allow authors to publish competing works, and in return authors get widespread distribution of their work to sell to as many customers as possible.
But Hachette is unable to come to terms with the biggest bookseller on the planet.
Why aren't these harmed authors angry at Hachette? They're not living up to their end of the deal. Has the Authors Guild even asked Hachette what's going on? Has Authors United?
Let me make this even easier to understand.
I sign a contract with a landscaper to mow my lawn.
The landscaper needs a lawnmower to do this. But the landscaper has been haggling with the lawnmower dealer for eight months, and still hasn't gotten a mower. And all this time, my lawn isn't being mowed.
Do I get mad at the lawnmower dealer?
Of course not. That would be ridiculous. It isn't the dealer who is preventing my lawn from being mowed. It's the landscaper's fault. He promised to cut my lawn, and it isn't getting done. He's the one I signed the contract with.
Now let's take it a step further. I live in a townhouse, so I'm part of a townhome association. It isn't only my lawn that isn't getting mowed, it's all homes in the neighborhood. The townhome association needs to do something. That's what we all pay them to do. They need to step in and fix this.
Should the association:
a) Talk to the landscaper and try to force him to settle his differences with the lawnmower dealer, so he can then cut everyone's lawns like he is contractually obligated to do.
or
b) Ask the government to force the lawnmower dealer to sell its lawnmowers to the landscaper under the terms the landscaper wants.
Why can't the Authors Guild see how ridiculous this situation is?
This action has caused thousands of writers to see a significant drop in their royalty checks.
I have to point out, yet again, that Amazon offered to compensate authors monetarily during the negotiation period.
Why isn't the Authors Guild pressuring Hachette to accept this offer?
Quote AG prez Roxana Robinson:
“But this seems like a short-term solution that encourages authors to take sides against their publishers. It doesn’t get authors out of the middle of this — we’re still in the middle.”
Actually, Roxana, Amazon's offer DOES get authors out of the middle of this. And authors SHOULD be taking sides against Hachette, for not only getting them into this mess, but also refusing to compensate them as Amazon offered.
How could she say that with a straight face, let alone believe it? And why didn't the reporter who took that quote point out how stupid it is?
Here's another analogy to make this simpler to comprehend.
Godzilla and King Kong are duking it out on the streets of NY. Citizens are getting trampled, and their property is being destroyed.
Godzilla says, "If King Kong agrees, we'll move all the people out of harm's way, and each chip in half for all the damage we cause."
King Kong says, "Nah."
And we should blame Godzilla? Seriously?
The Authors Guild challenges this threat to the literary ecosystem, one that jeopardizes the individual livelihoods of authors.
I'll opine that the business threatening the livelihood of authors is Hachette. It falls on Hachette to make its authors' books available in as many venues as possible. It's failing to do that.
What the Authors Guild could be doing is providing lawyers to unhappy Hachette authors to get them out of their contracts, so these authors could then self-pub.
The Guild started its own initiative to invite governmental scrutiny of Amazon’s outsize market share and anticompetitive practices in the publishing industry. Last summer the Guild prepared a White Paper on Amazon’s anticompetitive conduct, circulating it to the United States Department of Justice and other government entities. As a result of our request for the initiation of an investigation of Amazon, we hosted a meeting with the DOJ in our offices on August 1 so that a group of authors could make their case directly to the government, as the Wall Street Journal reported today.
Buttery Jesus on toast, the Authors Guild was vehemently against the DOJ when they went after five major publishers for collusion against Amazon, now they expect the DOJ will finally see their side of things?
Their side of things amounts to this, a Robert A. Heinlein quote from 1939, which Marc Cabot posted on Passive Guy's blog:
“There has grown up in the minds of certain groups in this country the notion that because a man or corporation has made a profit out of the public for a number of years, the government and the courts are charged with the duty of guaranteeing such profit in the future, even in the face of changing circumstances and contrary to public interest. This strange doctrine is not supported by statute or common law. Neither individuals nor corporations have any right to come into court and ask that the clock of history be stopped, or turned back.”
What the Authors Guild, and Authors United, want the DOJ to do is investigate Amazon for violating antitrust laws. According to the article, Publishers and authors say Amazon has too much power and needs to be reined in.
I agree Amazon has a lot of power in the book world. But is it too much power?
Amazon has stated that, "If we want a healthy reading culture, we have to work hard to be sure books actually are competitive against these other media types, and a big part of that is working hard to make books less expensive."
Douglas Preston: Well, they removed pre-order buttons.
DOJ: So Amazon is refusing to sell books that aren't available?
Douglas Preston: When you say it that way, it makes me sound stupid.
DOJ: I'm not sure we can help with that.
Douglas Preston: The Amazon part?
DOJ: The you sounding stupid part.
Douglas Preston: Amazon also stopped discounting Hachette titles.
DOJ: Weren't you against Amazon discounting titles? Isn't that what this negotiation is about?
Douglas Preston: Stop it. You're confusing me.
DOJ: What exactly do you want to happen here, Mr. Preston?
Douglas Preston: I want Amazon to do what I tell them to.
DOJ: Perhaps you should become a majority stockholder in Amazon, then. Hey, here's a nifty idea--have you tried sending a Fed Ex to Amazon's Board of Directors?
...
Kidding aside, there was some interesting chatter on Passive Guy's blog about this. Is it possible the DOJ will investigate Amazon? Here are some comments I found interesting:
Randall J. Morris: Here’s how the Sherman Act defines a monopoly (which is what the DoJ will look to):
“Monopolization requires (1) monopoly power and (2) the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen, or historic accident.”
And Wikipedia clarifies it a bit:
“Section 2 of the Act forbade monopoly. In Section 2 cases, the court has, again on its own initiative, drawn a distinction between coercive and innocent monopoly. The act is not meant to punish businesses that come to dominate their market passively or on their own merit, only those that intentionally dominate the market through misconduct, which generally consists of conspiratorial conduct of the kind forbidden by Section 1 of the Sherman Act, or Section 3 of the Clayton Act.”
I think Amazon falls into the category of dominating the market based on their own merit.
Nirmala: The word monopoly generally refers to suppliers not retailers. But there is a word for a retailer with unusually large market power or “buyer power” as it is called: monopsony.
DEFINITION of ‘Monopsony’: A market similar to a monopoly except that a large buyer not seller controls a large proportion of the market and drives the prices down. Sometimes referred to as the buyer’s monopoly.
I found this article (from the Financial Times) which suggests that Amazon does not have much to worry about:
“There lies Amazon’s advantage – it need not form a cartel to squeeze its suppliers because it is already large. With a 30 per cent share of the physical book market in the US and more than 60 per cent of ebooks, it clearly has market power in the antitrust sense. But there has never been a case in US competition law of a single company being declared an illegal monopsonist.
“In the US, the simple use by one company of monopsony power to extract lower prices from suppliers is not illegal. There is general intuition that buyer power means lower prices and lower prices are good,” says Jonathan Jacobson, an antitrust lawyer at Wilson, Sonsini, Goodrich & Rosati in New York.”
Nirmala: Here is another longer exploration of monopsony and anti-trust law.
I am not a lawyer (although I did stay at a Holiday Inn Express last night) but one thing that stood out in the above link was it suggests that while it is hard to prove harm from a monopsony consisting of one large company, that a collusive monopsony or ogliopsony (a group of buyers that control the market) is by definition illegal as a form of horizontal price fixing.
Now the publishers have already settled the charges that they acted illegally by colluding as suppliers to fix prices. It seems to me that they might also be guilty of setting prices illegally as buyers by colluding to set the royalty rates given to authors at their current low rates. As others have noted, the AG and AU may be opening a can of worms for the publishers by inviting more DOJ examination of the publishing industry.
Joe sez: Big 6 (now Big 5) publishing contracts have been notoriously one-sided in favor of the publishers for decades, and I think a smart lawyer would be able to make a case that they are unconscionable and therefore null and void.
Besides being one-sided, these contracts are all remarkably similar. Same lockstep royalties. Same lousy terms. And before Amazon, authors had no choice, because the publishing oligopoly controlled paper distribution. It was accept the terms or don't get your book into stores. If publishers also fit the definition of an oligopsony, and the DOJ becomes interested in exploring this, the Authors Guild and Authors United may be unwittingly bringing about the downfall of the very industry they're trying to protect.
But let's get back to the AG letter...
I agree Amazon has a lot of power in the book world. But is it too much power?
Amazon has stated that, "If we want a healthy reading culture, we have to work hard to be sure books actually are competitive against these other media types, and a big part of that is working hard to make books less expensive."
So it appears Amazon is using its power to lower the price of books.
Yeah, I expect the DOJ to jump all over that. Let us, for a moment, imagine the conversation that took place.
INT. DOJ OFFICE, DAY
A serious-looking DOUGLAS PRESTON, 58, is sitting at a board room table in deep discussion with a DOJ official.
Douglas Preston: Amazon wants to discount Hachette books.
DOJ: And how exactly is this bad? Aren't lower prices good?
Douglas Preston: It's hurting authors.
DOJ: Authors make less money when books sell for less?
Douglas Preston: Actually, authors make more money. Amazon wrote a letter explaining it.
DOJ: So how are authors being hurt?
Douglas Preston: Right now, Amazon is boycotting Hachette books.
DOJ: It refuses to sell Hachette titles? Do Amazon and Hachette have a contract?
Douglas Preston: They actually don't have a contract. And Amazon is still selling Hachette books.
DOJ: So how is that a boycott?
Douglas Preston: Well, they removed pre-order buttons.
DOJ: So Amazon is refusing to sell books that aren't available?
Douglas Preston: When you say it that way, it makes me sound stupid.
DOJ: I'm not sure we can help with that.
Douglas Preston: The Amazon part?
DOJ: The you sounding stupid part.
Douglas Preston: Amazon also stopped discounting Hachette titles.
DOJ: Weren't you against Amazon discounting titles? Isn't that what this negotiation is about?
Douglas Preston: Stop it. You're confusing me.
DOJ: What exactly do you want to happen here, Mr. Preston?
Douglas Preston: I want Amazon to do what I tell them to.
DOJ: Perhaps you should become a majority stockholder in Amazon, then. Hey, here's a nifty idea--have you tried sending a Fed Ex to Amazon's Board of Directors?
...
Kidding aside, there was some interesting chatter on Passive Guy's blog about this. Is it possible the DOJ will investigate Amazon? Here are some comments I found interesting:
Randall J. Morris: Here’s how the Sherman Act defines a monopoly (which is what the DoJ will look to):
“Monopolization requires (1) monopoly power and (2) the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen, or historic accident.”
And Wikipedia clarifies it a bit:
“Section 2 of the Act forbade monopoly. In Section 2 cases, the court has, again on its own initiative, drawn a distinction between coercive and innocent monopoly. The act is not meant to punish businesses that come to dominate their market passively or on their own merit, only those that intentionally dominate the market through misconduct, which generally consists of conspiratorial conduct of the kind forbidden by Section 1 of the Sherman Act, or Section 3 of the Clayton Act.”
I think Amazon falls into the category of dominating the market based on their own merit.
Nirmala: The word monopoly generally refers to suppliers not retailers. But there is a word for a retailer with unusually large market power or “buyer power” as it is called: monopsony.
DEFINITION of ‘Monopsony’: A market similar to a monopoly except that a large buyer not seller controls a large proportion of the market and drives the prices down. Sometimes referred to as the buyer’s monopoly.
I found this article (from the Financial Times) which suggests that Amazon does not have much to worry about:
“There lies Amazon’s advantage – it need not form a cartel to squeeze its suppliers because it is already large. With a 30 per cent share of the physical book market in the US and more than 60 per cent of ebooks, it clearly has market power in the antitrust sense. But there has never been a case in US competition law of a single company being declared an illegal monopsonist.
“In the US, the simple use by one company of monopsony power to extract lower prices from suppliers is not illegal. There is general intuition that buyer power means lower prices and lower prices are good,” says Jonathan Jacobson, an antitrust lawyer at Wilson, Sonsini, Goodrich & Rosati in New York.”
Nirmala: Here is another longer exploration of monopsony and anti-trust law.
I am not a lawyer (although I did stay at a Holiday Inn Express last night) but one thing that stood out in the above link was it suggests that while it is hard to prove harm from a monopsony consisting of one large company, that a collusive monopsony or ogliopsony (a group of buyers that control the market) is by definition illegal as a form of horizontal price fixing.
Now the publishers have already settled the charges that they acted illegally by colluding as suppliers to fix prices. It seems to me that they might also be guilty of setting prices illegally as buyers by colluding to set the royalty rates given to authors at their current low rates. As others have noted, the AG and AU may be opening a can of worms for the publishers by inviting more DOJ examination of the publishing industry.
Joe sez: Big 6 (now Big 5) publishing contracts have been notoriously one-sided in favor of the publishers for decades, and I think a smart lawyer would be able to make a case that they are unconscionable and therefore null and void.
Besides being one-sided, these contracts are all remarkably similar. Same lockstep royalties. Same lousy terms. And before Amazon, authors had no choice, because the publishing oligopoly controlled paper distribution. It was accept the terms or don't get your book into stores. If publishers also fit the definition of an oligopsony, and the DOJ becomes interested in exploring this, the Authors Guild and Authors United may be unwittingly bringing about the downfall of the very industry they're trying to protect.
But let's get back to the AG letter...
The Guild has been working closely with the grassroots group Authors
United—founded by Authors Guild Council Member Douglas Preston—which will be
making another request to the Department of Justice to investigate Amazon for
potential antitrust violations.
So the Guild supports a petition with 1000 signatures, while ignoring the opposing petition with over 8600 signatures.
So the Guild supports a petition with 1000 signatures, while ignoring the opposing petition with over 8600 signatures.
This is your Authors Guild. Fighting for the privileged status quo at the expense of the unwashed masses.
I've wondered before it the Authors Guild and Authors United know that they're full of hooey, and are actually doing these silly things to get media attention and try to turn public sentiment against Amazon. If that's the case, it isn't working. Amazon's customer approval rating is high, and more and more authors are figuring out that this is all pretty silly.
Our mission is to protect and support working writers. When a retailer, which sells close to half the books in the country, deliberately suppresses the works of certain authors, those authors are harmed, and we speak out.
I've wondered before it the Authors Guild and Authors United know that they're full of hooey, and are actually doing these silly things to get media attention and try to turn public sentiment against Amazon. If that's the case, it isn't working. Amazon's customer approval rating is high, and more and more authors are figuring out that this is all pretty silly.
Our mission is to protect and support working writers. When a retailer, which sells close to half the books in the country, deliberately suppresses the works of certain authors, those authors are harmed, and we speak out.
They speak out and oppose retailers who harm authors? Where was the Authors Guild when:
Bookstores removed erotica?
PayPal withdrew its services from erotica?
B&N manipulated erotica bestseller rankings?
Bookstores boycotted Amazon published titles?
Amazon removed reviews?
You know what, Authors Guild? All you have to say is, "The system, as it stands, earns some of us a lot of money. So we're going to support the system."
I can't argue with that. Hell, I'd respect that.
But the "support working writers" line is worthy of public ridicule and disdain.
Also, since you apparently don't know it, here's the definition of the word "suppress": verb (used with object)
- to put an end to the activities of (a person, body of persons, etc.):to suppress the Communist and certain left-leaning parties.
- to do away with by or as by authority; abolish; stop (a practice, custom, etc.).
- to keep in or repress (a feeling, smile, groan, etc.).
- to withhold from disclosure or publication (truth, evidence, a book, names, etc.).
- to stop or arrest (a flow, hemorrhage, cough, etc.).
- to vanquish or subdue (a revolt, rebellion, etc.); quell; crush.
Amazon hasn't put an end to the work of certain authors. They haven't done away with it. They haven't repressed it. They haven't withheld it. They haven't stopped it. They haven't vanquished it.
Amazon doesn't have a flotilla of war ships around Hachette's warehouse, preventing books from reaching the outside world.
Amazon hasn't even stopped selling Hachette titles, even though there is no contract that requires it to do so.
And you went to the DOJ with this? Really? When you left, did you hear giggling behind you?
We will continue to oppose any business tactics, from publishers or retailers, that interfere with working writers’ ability to present their products in a fair marketplace and to flourish within their chosen field.
Continue to oppose tactics from publishers?
Why aren't you opposing Hachette's tactics? Hachette is reportedly delaying negotiations. Hachette is refusing to compensate authors. Have you even been in contact with Hachette? Do you even know what terms Hachette and Amazon are fighting about?
Our goal is to ensure that the markets for books and ideas remain both vigorous and free.
Okay, let me get this straight. You want to ensure the book market remains free by forcing a retailer to sell books according to your rules.
Would you also like to ensure freedom of speech by forcing people to say what you want them to say?
How about you ensure freedom of religion by making everyone go to the church of your choosing?
How can a guild made up of authors write nonsense like this?
That's a question I'd love to have answered. The ball is in your court, Authors Guild. My blog is yours.
Defend yourself.
51 comments:
Having signed a trad publishing agreement when that was the only game in town, and having negotiated, drafted and litigated contracts for 33 years, I think it would be rough going to void a trad contract on the grounds of unconscionability. They do suck to the tenth power...but that isn't the same thing. I would like other practicing attorneys reading this blog to weigh in on this.
I think it would be rough going to void a trad contract on the grounds of unconscionability
Can you go into more detail? A contract lasts for the author's life plus 70 years? Do other contracts do that?
Isn't a non-compete against the law? Isn't that preventing someone from earning a living?
Why don't publishers ever offer authors higher royalties? How did they all come to the exact same conclusion that 25% of net is good for ebooks?
I'm not a lawyer, but something stinks here...
Joe,
I've come into this a bit late...well, it's still going on, but I never paid much attention to the discussions about contracts. I've always been an Indie guy--first comics (before eReaders) and now novels.
....but I'm finding this humorous, if not puzzling.
I'd also like to read more feedback from practicing lawyers chiming in on this. In fact, I'm gonna make a call and see if another fellow Indie author (a practicing lawyer specializing in contract law) is interested in looking closer at this.
I wonder, looking at the life + 70 years if (I'm stretching here, I know) that's to avoid having to pay coin to a surviving family...?
Also, on the non-compete, doesn't that matter depending on the state? Again this is just a guess, but in Utah, it's a right-to-work state, from what I'm told. Does that matter in this case?
Anyway, good questions--I'm gonna make that call. Thanks for posting Joe.
Joe- laws related to the issues can vary significantly from state to state...especially re non compete clauses, which are subject to court modification as to time and geography. As the big 5 are based in New York, primarily,it is likely that the contract would be interpreted in accordance with New York Law. As to unconscionability issues...it is a totality of the circumstances analysis...comparison with usual terms in similar contracts, representation by attorneys for the parties...case by case basis. Tough nut to crack.
As a recent ex-practicing attorney, please let me say this.
The proper approach to extricating oneself from one of these contracts isn't unconscionability. The proper approach is bad faith.
Here's why.
Implied in the publishing contract is the requirement of acting in good faith. Right now, it could be argued that publishers appear to be hurting their own authors by representing their own interests (higher profits) ahead of authors' interests (sales platform) by failing to contract with Amazon. This could support a claim for bad faith by author v. publisher, which could result in damages and could result in a breach being declared such that the author can then take steps to acquire what is called "cover" for oneself, which is law talk for mitigation of damages. Mitigation could take the form of self-publishing.
This would be a much more likely effective approach than "unconscionability."
This is theoretical. You will likely get as many opinions about "what to do" as there are responses from other attorneys. My suggestion does not mean to be the exclusive remedy. It is only one of many possibilities.
Dear Joe Konrath,
You;re a big meanie and hurt my feelings.
Sincerely,
D. Preston
One of your best posts yet, Joe.
AU an AG are supposed to be voices for authors. While recent evidence seems to point to the contrary, I'd like to know who protects readers? So far I haven't seen an org like Consumers Union take up the cause. Readers can only pressure with their pocket books. That's why the Big Five and the winning horses in their stables are running scared, especially about their ebooks, which can't compete under the present business model. AG and AU are just their mouthpieces.
I don't hate anyone either, but it seems Einstein was right. He thought only two things could possibly be infinite, the Universe and human stupidity. AG and AU's actions offer more evidence for the latter to the detriment of readers and writers everywhere.
Take it to them, Joe!
r/Steve
I think there's a tribal aspect involved in any non-best-selling author supporting Hachette. It has a parallel in politics. Why would any working stiff support a political party whose policies clearly favor the rich? The answer is: Hey, they're my people. They're my tribe. If I go over to the other side, I'll have to look at myself in a whole new way, and I don't want to do that. Maybe someday I'll win the publishing lottery and get rich, too. And I'll feel so good — not just because of the money and fame — but because II stayed faithful.
Always great fun to read it from your end, Joe. I'm an indie, and as such still holding judgement on who the enemy of my enemy is...
I don't have a major publishing contract and don't expect to sign one soon. I think the bad faith argument is indeed the way to go. In fact, I wonder if a mid-list author returned the advance (or even a pro-rated portion of it), what leg would publishers have to stand on if the author threatened, or actually did, pull out of the contract unilaterally? Being Big Pub, I would expect they'd ignore small fish, for awhile, and then you'd have a precedent and then all hell breaks loose.
Much to your glee, I would hope you could admit.
I'd just like to point out that I posted that Heinlein quote on The Passive Voice first, all the way back in June. Just sayin'. :)
Thanks, Chris. Great quote.
The unwashed, unPublished masses are not "working" authors, they are hobbyists.
I think I'll pass on a club where the secret handshake is a fist shoved into a dark place of my anatomy.
As a lawyer who deals with non-competition contracts all the time in an employment law practice (and who self-pubbed a book on employment law for employees), I’m happy to supply some brief, general information.
As an example of one way to explain non-competes, here is what a bunch of leading law professors think the law should be (from the Restatement (Third) of Employment Law): “A covenant in an agreement between an employer and former employee restricting a former employee’s working activities is enforceable if it is reasonably tailored in scope, geography, and time to further a protectable interest of the employer … unless (a) the employer discharges the employee on a basis that makes enforcement of the covenant inequitable, (b) the employer acted in bad faith in requiring or invoking the covenant, (c) the employer materially breached the underlying employment agreement, or (d) in the geographic region covered by the restriction, a great public need for the special skills outweighs any legitimate interest of the employer.”
Leaving out procedural fights about time and geographical limits, the best way to fight non-competes is to explore (1) does an employer (company) have any legitimate interest in restricting the employee from working (what special knowledge or investment have they made in fact, not just in a promise or on paper—remember it’s not just any interest of an employer but a legitimate one), and (2) has the employer (company) failed to live up to its side of the contract in a meaningful way?
Just my two cents. And yes, for a lawyer, this is very brief.
In addition to this brilliant post by Joe, there is a wonderful analysis of the media coverage of this dispute on Hugh's blog today:
http://www.hughhowey.com/give-customers-what-they-want/
It is a banner day in the blogiverse!
Unconscionable contracts tend to be intentionally misleading and duplicitous.
While many people would probably argue the language most contracts are written in makes them difficult to understand, they're actually done that way to be exact and specific.
Publisher contracts aren't generally misleading. You know going in that you're getting fucked. "Right, so I sign here, and you own exclusive rights to my IP for how long? Forever? Oh... Forever."
Whether or not you think this is fair, this is what you have agreed to.
An unconscionable contract would be, the wording and conversations with the publisher led me to believe that the terms of this contract would be for 2 years. Here's all these documented emails / letters / correspondence of our discussions. I clearly state, I want the contract to only be valid for two years. They told me that was the case and what I was agreeing to in the contract. I read over the contract and it seemed like that was the case.
Two years later, it gets pointed out that the contract actually says its valid for two years only if certain criteria are met. And that criteria was vaguely worded as to be misleading and in direct opposition to the intent of the contract.
"Unconscionable" doesn't protect you from signing contracts with bad terms. What it is designed to protect you from is vague legal trickery.
Contracts aren't supposed to be vague crazy magic mumbo jumbo that result in a "Gotcha!" moment. They're supposed to be transparent documents that reflect the intent of both parties.
If these authors and publishers want Amazon out of the pricing equation, wouldn't it just be easier to pull all their e-books from Amazon and use their own online stores? It doesn't seem like it'd be that difficult to do if they haven't set one up already. Or they at least link to places that sell them besides Amazon. Just remove the Amazon links.
Of course they won't, though, because they want access to Amazon's customer base. They never acknowledge forthrightly exactly why Amazon has this leverage over them.
The thing is, there's no particular reason to buy e-books from Amazon except that it's easier to get them on your kindle. If people are using their smart phones or tablets it's just as easy to use ibooks or Google play. You'd think this would not be such a hurdle to overcome, unless there's a lot more kindles in the wild than I've seen.
Steven M Moore asked: "While recent evidence seems to point to the contrary, I'd like to know who protects readers?"
The Dept of Justice. They investigated the collusive price-fixing scheme of Apple+5publishers on behalf of the consumer, not on behalf of Amazon.
The settlements in that case required that a large sum of money, gained through artificially raising and fixing prices in an antitrust violation, had to be returned to consumer.
The collaborators in that scheme were not required to pay anything to their suppliers (authors), though the scheme had reduced the suppliers' royalty earnings. But the DoJ settlement did require them to repay pay money to the consumer: readers.
What the AG and AU seem not to understand is that antitrust law protects consumers, not competitors and not suppliers. For their commplaints about Amazon to have merit with the DoJ, they will have to show that Amazon is hurting consumers, not corporate publishers and not authors who are contracted as suppliers to corporate publishers.
And since Amazon's focus is on lowering consumer prices, it's difficult to see how they can present a case that Amazon is hurting consumers. All the complaining in the world also doesn't change the fact that Amazon is NOT a monopoly and the publishers'/authors' products have other paths to the consumer market (such as Kobo, BN.com, Apple/iBooks, BooksAMillion, and indie booksellers); complaining that the most successful outlet doesn't want your product (or that it doesn't want your product on YOUR terms) is a completely separate and unrelated matter to the antitrust violations that AG and AU are claiming.
James- what you describe as unconscionable is more of a claim of fraudulent inducement. Enough law school stuff--here is what is really important for anyone contemplating signing a trad contract...BE VEWWY VEWWY CAREFUL WITH INDEMIFICATION AND OUT OF PRINT DEFINITION CLAUSES!!! You may not be able to modify them, but give it the old Icarus try folks.
I'm glad Nirmala clarified my comment with hers. My point is that they keep yelling "Monopoly!" and even under that definition they would lose.
One thing I just can't let go from their letter. AU is a "grassroots group?" Are you kidding me? Let's go to Wikipedia on this one too.
From Wikipedia: "Grassroots movements are often at the local level, as many volunteers in the community give their time to support the local party, which can lead to helping the national party."
I don't think that describes AU. There is a term later on in the Wikipedia article that fits them more properly:
"Faking a grassroots movement is known as astroturfing, which, as the name suggests, is named after AstroTurf, the iconic brand of artificial grass. Astroturfing means pretending to be a grassroots movement, when in reality the agenda and strategy are controlled by a hidden, non-grassroots organization."
So astroturfing is faking a grassroots movement when they are clearly controlled by a hidden party. Hatchette, perhaps?
AstroTurfing United has a nice ring to it... :-P
Fraud in the inducement is a party deliberately being misleading. It's the act of getting the person to sign that's the issue. Generally, there's nothing wrong with the contract.
Unconscionable contracts are contracts that are misleading or duplicitous. They don't have to be intentionally so. There doesn't need to be any sort of coercion on the part of either party to have an unconscionable contract. It's the document itself that's the issue.
Think of a parking stub. You ever look at the back of those? Technically, every time you take one, you're agreeing to the terms. Most are limiting liability.
They're there because, if your car gets hit by another driver or your stuff gets stolen, it's not the parking structure that's at fault.
But say, the parking structure collapses on your car. Despite what it says on the back of that ticket, you still have a claim against the owners of the parking structure. It's an unconscionable contract.
Did the AU authors say they were not taking sides before or after the meeting between AG officials, authors, and the DOJ?
Idiot publisher publishes book with comments between author and editor in text:
http://www.mhpbooks.com/anthony-horowitz-to-copyeditor-im-not-changing-this/
Quality control fail - do publishers even read their own books that they publish?
It's bad but not as bad as that quote implied. The galley in question is an Advanced reading copy for reviewers not the version that goes to stores.
James-as you list your occupation as screenwriter,I will defer to you on legal matters, as nowhere else in the world do we find more fraud, and more unconscionable contracts than in the film industry. Nowhere else does a writer get screwed like they do in tinsel town.You're a brave man!
Terence O'Brien asked, "Did the AU authors say they were not taking sides before or after the meeting between AG officials, authors, and the DOJ?"
Authors Coming Untied stated in their letter to Amazon's BOD which came out in mid-September, "Our position has been consistent. We have made a great effort not to take sides. We are not against Amazon."
The letter was released a month and a half after they participated in a meeting asking the DOJ to investigate Amazon.
Correction: It is not entirely clear that "Authors United" participated in the meeting, but the Author Guild says that they held the meeting so that "a group of authors could make their case directly to the government"
I guess it seems pretty likely that group of authors included some or all Authors United members....
Gotta love it: the NYT in their section for students called "The Learning Network" is now using its own lopsided articles to “educate” students about the Amazon/Hachette dispute. I love the leading questions for students at the end of the article:
– Is Amazon getting too big and powerful? Is Amazon behaving like a monopoly with too much control over an industry?
— Is it a problem that Amazon sells half the books in America? Is there anything lost when brick-and-mortar bookstores close? Can one company have too much influence in what books are being published, how they are being sold and at what prices?
Here is the link to the article:
http://learning.blogs.nytimes.com/2014/10/02/is-amazon-becoming-too-powerful/
Nirmala, I might have been one of (if not the) last person to get a critical comment through on the AG blog. It was on 17September, it was up for about an hour, then they killed it. Because free expression or something.
Dan's always ruining it for the rest of us. And by ruining it, I mean saving us time.
Here's a new question. Where is The AG and the AU over the huge mess over at Ellora's Cave? Where the person in charge is dragging the publisher and people's book rights down into the depths while flipping people off?
Honestly, as much as I shake my head at this, I've given up any hope of conversation with the other side. When people argue that Amazon has a clear obligation to offer a company's products based on Amazon's market share, you realize there is just no getting through to these people until the Big 5 completely crumble to the ground.
Because free expression or something.
If free expression wasn't curated by the finest writers in the English language, then just anybody could say whatever they want.
One of the problems of trying to get out of a contract that I see is the cost. Since it seems as laws vary from State to State, Country to Country, and depend on case law and specific circumstances, there is a chance the author might lose.
Correct me if I'm wrong but in that case the author pays all their lawyer fees ($200-500 an hour??), the court fees (thousands??) and possibly the legal fees for the other side as well. Plus, going up against a company with deep pockets who can likely stall, inceasing your legal fees, this would be quite a risk for most of us who are doing okay or getting by.
Once again, it is the poor soldiers who will go first and make it easier for those who follow, but in the mean time, prevention is the best option...don't sign anything you can't see yourself living with, now and in the future.
Has anyone tried this and lost, who would mind sharing what it cost them? Joe, I'm sure it cost you a bundle to get your rights back - I know you can't talk about it, but I'm sure it has or will pay off for you. I'm more interested, though, in the cost of losing so people can make an informed decision of the risks.
Terrence said, "If free expression wasn't curated by the finest writers in the English language, then just anybody could say whatever they want."
I guess the Authors Guild motto is:
Free Speech for the Finest Writers in the English Language, and Everyone Else Just Please Shut Up Already.
These blind supporters of publishing need to be VERY careful about the steps they support. You know why I think Amazon is still selling Hachette books even though they don't have to? Because it's still profitable to do so.
The more trouble publishers and these groups cause Amazon, the more pain they try to inflict to force Amazon's hand, the harder it's going to be to keep selling those books. One day Amazon may have nothing to gain anymore from it, and then these groups will be sorry!
When is the next of the big five due to renegotiate their contract with Amazon? I'm guessing that will be a crunch point.
Is Hachette simply delaying things till the next publisher comes along to add their weight to the fight?
What are the chances that Amazon will start to get a little more proactive before this happens. In their shoes, I'd be tempted to make a final, very public, offer to settle, then pull Hachette from the virtual shelves if they didn't come to an agreement.
I don't think the loss of Hachette would be a major problem. Unless I was a fan of a particular Hachette author, I doubt I'd notice they were even missing.
Unlike others who've previously commented on this blog, I doubt the loss of 'universal' choice on Amazon would be an issue for many. If I couldn't find the author I wanted, I'd be likely to follow an Amazon recommendation to another. I'm always looking for new writers.
On the subject of contracts. I've signed a number of these with legacy publishers. Signed them without thinking in most cases. I figured that an industry had been going since before Dickens must know what it was doing...
Now, I can see how grotesque they are, but I've no-one but myself to blame. No-one twisted my arm. I was a big boy who made his own decisions.
If I had a time machine, I'd go back and slap myself silly.
Hi Joe:
I'm just a reader, not an author nor a publisher. I just read everything: books, magazines, newspapers, and formerly cereal boxes. I read you, Shatzkin, the NYT, Washington Post, and many articulate spokesmen representing the indie side. I buy a lot of books.
All that being said, it's obvious to me that both positions, battle lines having been drawn, have resorted to hurling insults all of which have now been codified and are no longer original. You have explained your side quite articulately many times. The AU, Streitland and Shatzkin (clearly he knows which side his bread is buttered on) have attempted less successfully to present their point-of-view, which, only naturally is the one they feel brings them the most money.
We’ve reached the stage where nothing new is being said, only repeated ad nauseam, and frankly most readers really don't care. Amazon needs publishers and Hachette and the AU need Amazon (or some other efficient retailer). All this talk about Amazon not selling Hachette or Hachette pulling their books from Amazon is just silly. Will never (shouldn't) happen. A brief survey of the books of many AU signatories reveals their books are readily available from a variety of sources including Amazon. Indies can only benefit if Hachette wins higher prices; legacy authors may benefit from contractual changes. None of these outcomes will be influenced by loud posturing. Hachette and Amazon will come to terms eventually.
The point is that NO One will be persuaded by either side anymore. Both sides have adopted a righteous stance and defend it with religious fervor. It’s like watching 17th century Protestants battle Catholics. Neither of them was ever persuaded, either
Another litigator weighing in here.
I agree with Adam and John that unconscionability is a tough case to make (although it is a kick-ass word).
As most trad pub contracts follow law of New York, it behooves one to consider the definition of the word under New York law. It’s quite amusing, really:
An unconscionable contract is one such as no man in his senses and not under delusion would make on the one hand, and as no honest and fair man would accept on the other. A contractual clause will not be enforced where it is so monstrous and extravagant that it would be a reproach to the administration of justice to countenance or uphold it.
Wow. If that definition applied, there would a whole lot of smart people who’d be embarrassed they signed! (Gotta love the “not under delusion.”)
On the other hand, we have the duty of goof faith and fair dealing, which is implied in all New York contracts. That duty is defined this way:
In appropriate circumstances, an obligation of good faith and fair dealing on the part of a party to a contract may be implied and, if implied will be enforced. In such instances the implied obligation is in aid and furtherance of other terms of the agreement of the parties. No obligation can be implied, however, which would be inconsistent with other terms of the contractual relationship.
So, to Joe’s point about Hachette ignoring its obligation to authors to sell their product, this might be the strongest approach.
Eric Welch said: "The point is that NO One will be persuaded by either side anymore. Both sides have adopted a righteous stance and defend it with religious fervor."
When one side is right and the other is wrong people can, and many will, be persuaded.
"Let's agree to disagree" is a typical clarion call for the side without the facts.
I prefer to keep battling against ignorance. It's an ethics thing.
@Laura,
DoJ stepped in when Apple colluded with the Big Five (Big Six maybe back then?). They've not been a player so far in the Amazon v. Hachette kerfuffle. Moreover, they only step in when egregious things happen against the consumer. Generally, for the most part, the consumer's only protection is via his buying power because whoever.org prefers hands off unless the case is exceptional (and big news?). I'm not afraid of the big S-word, but often the whoever.org's can also muddy the waters when they jump in, and there's always the chance it gets to the SC, where we can usually predict what happens (the SC does NOT protect consumers).
r/Steve
I prefer to keep battling against ignorance. It's an ethics thing.
Agreed.
My blog is A newbie's Guide to Publishing, even though many pros and veterans weigh in.
Every day there are new authors looking to find a home for their debut novel. If they read the media, they're lead to believe Amazon is the devil, and Hachette is a good company supported by many gigantic bestselling and award-winning authors.
This clouds the newbie's opinion of the situation.
When I break down the nonsense spouted by the AG or AU, a new writer just learning about this situation can make an informed opinion, rather than one based on poor, one-side journalism and status quo propaganda.
And make no mistake: it's propaganda. The hyperbole, the fallacies, the loaded word choices, the absolutism--AU and AG are going for public sympathy, not facts and logic.
b) Ask the government to force the lawnmower dealer to sell its lawnmowers to the landscaper under the terms the landscaper wants.
I think this is the corollary to WhaleMath(TM) but in logic terms, so it should be properly called WhaleLogic(TM).
Anon Author
I also want to invite any member of the Authors Guild to post in the comments, or email me, and explain where I'm wrong.
You're not wrong. I'm sure I'm not the only Authors Guild member to have recently resigned. I was a member for 30 years. Any others out there?
"I also want to invite any member of the Authors Guild to post in the comments, or email me, and explain where I'm wrong."
Have you got many emails, Joe? Because besides Joe Cottonwood's comment, I don't see many comments from Authors Guild's members here.
Anon Author:
I think this is the corollary to WhaleMath(TM) but in logic terms, so it should be properly called WhaleLogic(TM).
A whale can only put up with so many insults, you know. The correct technical term for this kind of reasoning is ‘publisher’s intuition’.
One has to know these things when one has a doctorate in Non-Cognitive Philosophy. (Trust me on this.)
SJArnott said...
Unless I was a fan of a particular Hachette author, I doubt I'd notice they were even missing.
I am a fan of a particular Hachette author, one who has ebooks available for sale in the UK. But not in the US. The author is dead, the books were published decades before ebooks were conceived, but Hachette now owns the rights and can't be bothered to make the ebooks available. So who is doing the censoring?
Not only does Roxana Robinson say that the offer by Amazon to give authors 100% of the revenue while restoring preorders, discounts, etc. does not get them out of the middle, but it "encourages authors to take sides against their publishers."
Huh? If I was getting 100% of the revenue from my ebooks and all of the other problems affecting me were resolved, then I would be cheering Hachette on with a marching band and some cheerleaders. I'd be encouraging them to stand their ground, never compromise, take no prisoners, and keep negotiating until the cows come home. At that point, the longer the negotiation with Amazon takes, the better for me. So maybe she is right, it would not take them out of the middle, it would put them 1000% in favor of every demand Hachette can think of, and they would support Hachette forever if that is what it took for Hachete to get what it wants.
---Oh wait, I meant to say forever if not longer as a tribute to Patterson's "immediately if not sooner."
They are definitely not allowing any comments on http://www.authorsguild.org/advocacy/authors-guild-makes-public-its-call-for-antitrust-scrutiny-of-amazon/
Janine said...
"I am a fan of a particular Hachette author, one who has ebooks available for sale in the UK. But not in the US. The author is dead, the books were published decades before ebooks were conceived, but Hachette now owns the rights and can't be bothered to make the ebooks available. So who is doing the censoring?"
It's not uncommon. I'm a fan of Alexander Fullerton. He was an excellent thriller/action writer, but very few of his books are available now. I wrote to the agents who handle his estate to ask if there were plans to republish as ebooks, but got no response. They seem to be happy enough with the revenues that trickle in from library loans.
There are so many great author blogs out there...but what keeps me coming here the most is the entertainment factor. Joe, your posts are always informative and relevant, but they are also so entertaining that I always come here first. That Preston/DOJ conversation...classic!
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