A Publisher's Conversation with Authors: Contracts You Should Not Sign

 

(photo by Frank Perez)

It is Tuesday. Time to tall turkey. Monday's madness is over, and Wednesday will take us over the hump, so Tuesday it is--for some serious discussion with authors. Tuesday talks mean to address authors in waiting and self-published authors who would like to go a more traditional route or who would at least like to take their steps with a publisher by their side.

Today's topic is about contracts--bad ones. We will state upfront that contracts are filled with legal terms that are often difficult for authors to understand. That legal information is important, critical, required. Also important, critical, required is that authors understand what they sign, reading the proposed contract as carefully as they would read any other document. AND RUN IT PAST AN INTELLECTUAL PROPERTY RIGHTS LAWYER.

OK, let's take a look at one can go wrong with a contract.

Rights and copyrights (see our previous blog POST on this topic for more information):

• Never sign a contract that buys all rights. 
• Never sign a contract that purchases your copyright. Your copyright should remain with you for life. Selling it means you lose your work permanently.
• Read carefully what rights you selling in terms of duration, language, versions (paperback, hard cover, e-books, audio books). Are these the rights you thought were selling? Stand firm on what you want to sell and not want to sell. The worst that will happen is that you will lose the contract and need to find another publisher -- which may also be the best that will happen.
• Some contracts have a clause about ancillary products -- puzzles, cards, t-shirts. Most publishers could care less about these products, and they are generally not included in contracts one way or another. If you are concerned, though, you can ask a publisher to add such a clause. 
• Some publishers also require through their contracts that the publisher must be given first right of rejection for anything else an author writes. Personally, I would not agree to such a term, but many authors do without any real harm. It has the positive aspect that a publisher is ready to consider your subsequent works. 

Duration of rights sold

• Check to be sure that there is a clause that says how long the contract lasts and who may cancel it. Typical are some of the following terms:
• Two years is a typical term of duration; so is 3-5 years.
• Some publishers will stipulate that the first two years (or three, or five) are locked in, but after that the author has a right to ask for a reversion of rights (i.e. you get your book back and can do whatever you want with it).
• Some publishers will identify a concrete period of time in the contract, after which the book comes back to you, period.
• If a book reverts to you, you will have to find another publisher or self-publish. Are you up for that? Make sure your period of contract reflects what you want.
• Be careful of the word, full term. That means the life of the author plus 70 years.
• Check the terms of continued publication:
• Under what circumstances can you take the book back? This should be specified.
• Failure to publish within a certain amount of time.
• Failure to meet contractual obligations.
• Under what circumstances might the publisher use to end the contract?
• Failure of the author to meet specific, stated obligations.
• Failure of the final manuscript to pass muster. (Most publishers will have a clause that says the final manuscript must meet publisher quality expectations and that the publisher can send the book for review to specialists if so desired--and the reviewers' recommendations on publication will stand.
• Bankruptcy or going out of business. No one expects this, but it can and does happen. What happens to your book in these cases should be specified in the contract so that your book does not end up lost in legalities.
• Make sure these terms are to your satisfaction; a lawyer can help you parse through the terms. 

Royalties

• Royalties are paid either on list (less common) or on net (more common). List is usually 10% or less; net is typically much higher, but can also be 10%. Do the math. '
• If you got an advance, can you reasonably pay it back with these royalties and then go on to make money?
• Are the royalties fair? That depends upon what similar publishers and contracts are paying for similar works and authors--another reason you need to check with an attorney; these are not things most authors know.
• When and how is accounting made to authors? This should be clearly stated.
• Some publishers pay quarterly; others pay annually. You will not likely be able to negotiate your preference. Tracking, calculating, and paying out royalties is a considerable accounting expense, and publishers have set up the system that works best for them. If there is no accounting period mentioned (e.g. February of each year), this is a red flag. Do not sign!
• When are royalties paid? This may be at a different time than the accounting statement is sent out. That is okay, but a time, at least annually, should be stated in the contract (e.g., in March of each year). If this is not specified, do not sign.

These are some of the red flags. There are more, and they can be as disparate as there are scammers out there. If anything looks odd, well, you know the answer -- check with a lawyer. If you do not understand something, again, you know the answer  -- check with a lawyer. Your book contract is too important to wing it, based on what you think is commonsense. Common law is based on precedent, not on commonsense.

Want more specific guidance on this topic? Check out The Passive Voice blog, which is written by an intellectual property rights lawyer. We also have connections to an intellectual property rights lawyer we trust and would be happy to make a referral to her.    

A caveat: When you do check with a lawyer, make sure it is the right kind -- intellectual property rights. A defense attorney, prosecutor, or family lawyer is not going to be familiar with publishing practices. One author lost a contract because her lawyer friend through the publisher should pay air fare for her to travel around the country, promoting her book, for the first six months. Even leading politicians do not get that kind of contract! Don't ask a friend who is a lawyer to read your contract. Ask a friend who is a lawyer to refer you to an intellectual property rights lawyer. 

Lesson for today's Tuesday talk: Do not sign what you do not understand (including benefits and obligations, as well as disadvantages); talk to an intellectual property lawyer. 

Just as you would check out a sales contract or a mortgage contract, you must check out a publishing contract. Don't let any kind of pressure prevent you from doing that. If you are not an intellectual property rights lawyer, find one. It will be worth the investment.

Read more posts about publishing HERE.

The Tuesday talks reflect real discussions between the management of MSI Press LLC and our own authors or those would-be authors who come through our doors but don't make the cut--yet. If you have a topic you would like addressed, leave the question in the comment section. Chances are, in our 18 years of publishing first-time and experienced authors, we have had a conversation with one of our authors that we can share with you.