Publishing Law Frequently Asked Questions (FAQs)
When do I need permission to use someone else's material?
A. The answer is simple:
whenever the failure to seek permission will result in copyright
infringement. Since 1976, U.S. copyright is automatic when an original
work -- text, art, photos or music -- is created and fixed in a copy or
recorded for the first time. Neither registration nor copyright notice
is required. Reproducing someone's copyrighted work without their
permission -- even if you give them attribution - is infringement.
It is safest to assume, therefore, that you must get
permission from the copyright owner for all material - text, quotes,
lyrics -- unless the material falls into one of the following two
Public domain material.
Public domain material includes items that cannot be copyrighted
(ideas, titles, names, short phrases, and slogans); works whose
copyright expired and/or was not renewed (including all work created
before January 1, 1923); most federal government documents (but not
those created by private contractors); and many state government
documents and publications.
Fair Use. You also don't
need permission if your use of the material qualifies as "fair use"
under Section 107 of the Copyright Act. In general, however, fair use
always is a short excerpt used in connection with genuine criticism,
parody, or teaching. Use of material in a review or scholarly article
is fair use; use in novels is not. (For example, including lyrics from
the Rolling Stones in your novel is not fair use.)
In theory, getting permission should be easy - just
find out who owns the copyright and ask. In practice, however, it can
be tough. Publishers are easier to track down than authors, and they
usually can put you in touch with the author. Libraries have many
directories available, such as the Literary Marketplace, to help you
find publisher's names and addresses. The U.S. Copyright Office
(loc.gov) also will research copyright ownership for a fee.
Many copyright owners use licensing agencies to handle
permissions such as the Copyright Clearance Center
(http://www.copyright.com). You can locate song lyric ownership through
the American Society of Composers, Authors, and Publishers (ASCAP)
(http://www.ascap.com/index.html ); Broadcast Music Incorporated (BMI)
(http://www.bmi.com/home.asp); The Harry Fox Agency, Inc. (HFA)
(http://www.nmpa.org/hfa.html); and SESAC (http://www.sesac.com).
Unfortunately, getting permission from an agency
usually involves paying at least a nominal fee. In many cases there
will be no fee, or a nominal fee charged by the owner, but in other
cases the fee will be prohibitive for your projected use.
What if you can't locate the owner? The simple answer
is, you can't use the material. It's no defense in an infringement
claim that you couldn't locate the author. Instead, try to find some
other excerpt that suits your purpose.
Should writers and authors carry special liability insurance?
A. It depends on the type
of book. Fiction is safest, although if you write true-crime novels,
you might be sued for defamation, invasion of privacy, or violation of
the right of publicity. Non-fiction book are more likely to be sued for
Although all but the smallest publishers carry a media
liability ("errors and omissions") insurance policy, these policies
protect the publisher, not you -- unless you are specifically added as
an "additional insured." Depending on your negotiating power, some
publishers will do this without cost to you, while others will refuse
the request or require you to pay for the an endorsement to their
Of course, if both you and your publisher are sued (the
usual situation) then, to the extent the publisher defends the case,
you also will benefit. There may be a conflict of interest, however,
between you and the publisher, or the publisher may settle, leaving you
alone in the lawsuit. Furthermore, most publishing agreements require
the author to indemnify the publisher for all claims and damages
resulting from a breach of the author's warranties. As a result of this
indemnification clause, you will have to pay not only your own
attorney's fees, costs, and any judgment, but also those of the
Ideally, authors should have their own media liability
insurance policy. Unfortunately, the premiums are likely to be $3-4,000
for $1 million protection with a $5,000 deductible. You can contact any
general insurance broker to get quotes for media liability insurance,
or go directly to companies that specialize in publisher's insurance,
such as Argo Insurance (http://www.publiability.com). Because of its
cost, most fiction writers will forgo liability insurance. If, however,
your book has a high risk factor because of its subject matter or
characterization, it may be worth investing in it. You'll sleep better
Many writers also believe - wrongly - that they can
limit their liability by incorporating or forming a limited liability
company. Although doing so will protect you from certain contract
claims, in most cases you still will be personally liable for copyright
infringement, defamation, or invasion of privacy.
I fired my agent. What happens if an offer is made on my book?
A . Start with the general
rule: an agent is entitled to receive a commission on royalties on
publishing contracts she negotiated during the term of the agency
agreement -- even after the agency agreement is terminated - but NOT
from royalties resulting from a publishing agreement signed AFTER
termination of the agency. This means that if an editor to whom she
sent your book makes an offer after you terminate her, you may hire
another agent to negotiate the contract (or negotiate it yourself),
even though it was through your original agent's effort that the book
was placed with that editor.
Now, for the exceptions, in order of likelihood. First,
some agency agreements have a clause requiring you to pay a commission
on royalties from publishing agreements made during a period of time
after termination (usually six months), if the purchasing publisher had
originally been solicited by your agent. This provision often is
unenforceable because of poor contract draftsmanship by the agent, but
any writer with such a clause should get a list of all such publishers
from the agent upon termination .
Second, some literary agencies include in their agency
agreements (or in the publishing contracts they negotiate) an
"interminable agency" clause. Rather then limit their right to
representation during the term of your agreement, such clauses grant
the agent an exclusive, irrevocable right to represent your work for
the entire term of those
works' copyright. The agency will be entitled to a commission on your
work even after it goes out of print from the deal the agent
negotiated, and a new publisher republishes it. After your death, your
executor would have to keep track not only of which of your works are
still under contract, but will also have to determine whether an agency
has an interminable right to represent any of your out-of-print works.
Your agency may merge, dissolve, or change names, providing more
complications for your executor. If you have such a clause, you should
ask your agent to give you a written release from its terms.
Third, some agents use the phrase "agency coupled with
an interest" in their agency agreements. This is a bit of legalese
intended to make the agency relationship irrevocable (again!).
Ordinarily, a principal (you) may terminate an agent "at will" (or at
the end of a contract term), and the agency also terminates
automatically on the death or disability of the principal. This clause,
however, grants the agent the exclusive, irrevocable right to represent
your works for the entire term of those works' copyright. This means
that even if you terminate the agency, and the rights to your book
revert back to you from the publisher, you are obligated to pay the
agency a commission forever for all future sales, even if the agency
did nothing to cause that sale. It could even mean you would be paying
two agency commissions, which could amount to thirty percent or more.
This also would apply to your heirs. Again, if you have such a clause
in your agreement, you should ask your agent to give you a written
release from its terms.
Bottom line: read - and understand -- your agency
May I use real people, or characters based on real people, in my
A. Well, maybe.
When you write about real, live people you expose yourself to legal
liability? even if you tell the truth. And simply changing the names is
no solution if the person can be identified by circumstances,
appearance, or setting. Yes, disclaimers may help, but you can't rely
on them. Let's take a quick look at the law of defamation, privacy, and
the right of publicity:
Defamation. Defamation is
written or spoken injury to the reputation of a living person or
organization. Injury to reputation generally is considered to be
exposure to hatred, contempt, ridicule, or financial loss. Libel is the
written act of defamation; slander is the spoken act. Whether libel or
slander, the defamation must be "published" - communicated to someone
other than the subject of the defamation. Truth IS an absolute defense
to defamation: if what you say is true, it cannot be defamatory.
Another defense to defamation is proving that the statement was an
opinion, not an assertion of a fact. In fiction writing, a publisher
can be liable for a defamatory statement only upon a showing of
negligence, and public figures have an even higher standard: they must
show that the defamatory statement was published with "actual malice."
Right of Privacy. Privacy
law consists of four distinct "torts" or legal wrongs: intrusion upon
seclusion; appropriation of name or likeness; public disclosure of
private facts; and publicity placing a person in a false light.
Generally only the latter two -- public disclosure of private facts,
and "false light," are relevant for writers.
Public disclosure of private facts occurs when a writer
discloses private and embarrassing facts about a living person that are
not of "public concern," such as details of a person's sexual problems,
physical, or mental ailments. For example, publicizing the fact that
your brother-in-law has failed to pay his mortgage for three months,
although true, would be an invasion of his privacy. Matters of public
record, even if private, are not protected by privacy law. If a writer
publishes a story disclosing facts obtained from a police publication
or a court opinion, the matter is of public record and no lawsuit will
be successful. Public figures (politicians, movie stars, professional
athletes, etc.) have a somewhat lessened right to privacy because of
the public's legitimate interest in their affairs. For example, a
magazine may publish a profile of a politician without fear of being
sued for invasion of privacy.
"False Light" privacy
lawsuits occur when a writer publishes facts about a person that
creates a deliberately false and misleading impression, such as when a
newspaper publishes a story about convicted felons and includes the
name or photograph of an innocent person. Once again, there is an
different standard for when the published material is in the public
interest or about a public figure. In such cases, the public figure
must prove that the publisher acted with malice or with reckless
disregard for the truth.
Right of Publicity. Most states now have laws that
protect living celebrities, and in some states, recently dead
celebrities like Elvis Presley, from the commercial exploitation of his
or her name, likeness, or persona. News stories, biographies, and
fiction, however, are protected by the First Amendment. To the extent
you portray a celebrity in such works without defaming him or his
family, you need not seek the celebrities' permission. You would,
however, need permission to exploit purely commercial "spin-offs" of
your work, such as t-shirts or posters.
If you have any doubt about the use of real names in
your work, consult an publishing attorney BEFORE publication.
Should I Register My Copyright?
registration isn't necessary to obtain copyright protection,
registration is a prerequisite to filing a copyright infringement suit.
In addition, the law confers certain benefits to copyright owners who
formally register, specifically additional money damages and attorney's
fees will be available to the copyright owner in court actions.
Book-length works are generally registered at publication; shorter
works are seldom registered unless there is an infringement.
What Can NOT Be Copyrighted?
A. You can't
copyright ideas, titles, names, short phrases, and slogans, no matter
how original or unique (some of these can be trademarked, but that's
another story). Also procedures, designs, concepts, charts and tables
of common authorship, etc.
When Can I Register My Copyright?
may be made at any time within the life of the copyright. Unlike the
law before 1978, once a work has been registered in unpublished form,
it is not necessary to make another registration when the work becomes
published. Usually this is done only if the work is substantially
altered in its published form.
What is self-publishing?
traditional royalty publishing, the publisher screens books for quality
and marketability and then, at its cost, handles editing,
manufacturing, marketing, promotion, sales, warehousing, and
fulfillment. The author receives a royalty on sales. The
self-publisher, by contrast, undertakes all of these tasks at his/her
own cost, but keeps all revenue.
What is "vanity" publishing?
publishers, for a fee, will print and bind a book, register its
copyright, provide an ISBN number, and offer a "package" of services
including "promotion" and "marketing." Despite their claims, these
publishers will NOT get your book into bookstores, nor will the books
be reviewed. They do, however, put your book on their web site and in
their "catalog." (When was the last time you shopped for a book in a
vanity press catalog?) Although it would seem that vanity publishing is
easier than self-publishing, you will be overcharged and the tasks will
not be done any better (and usually worse!). Keep in mind that vanity
publishers will publish anyone, regardless of the quality, and thus a
stigma is attached to their products. To avoid this stigma, many vanity
publishers call themselves "subsidy" publishers, which they are not.
True subsidy publishing is a hybrid of traditional and self-publishing:
the author pays a fee to the publisher but the publisher also
contributes a portion of the cost, and thus is selective in what is
What is print-on-demand publishing?
technology has brought more printing options. Print on demand (POD)
books are stored digitally; when a customer or a bookstore orders a
copy, the POD publisher (e.g., iUniverse, Booksurge) uses its
technology to create a copy, thus eliminating the cost of inventory and
returns. POD is substantially cheaper ($99-$500) than paying for a
print run, so it's a good alternative if you plan to sell only in
small, sporadic amounts. Unfortunately, POD print and graphics are
often fuzzy and less readable than traditional printing, and the books
carry a high retail price. As with vanity publishers, there is no
marketing or promotional effort. If you are interested in POD, be sure
you are aware of precisely what rights you are giving to the POD
publisher, and for how long. Will you be able to terminate the contract
and get the full rights returned to you in the event you sell your book
to a traditional publisher?
What is a "Literary Executor?"
A. You may have
heard the term "literary executor," which is not actually a separate
statutory or legal office. (An "executor" is a person responsible for
settling a deceased person's estate.) A "literary" executor is simply a
co-executor whose responsibility is limited to your literary works.
Very often, there is no need to name such a separate individual - your
general executor (usually a spouse or other relative) is also the
person you would wish to be in charge of your literary works pending
their distribution to the beneficiary. But if you believe that managing
your literary works requires experience in publishing and literary
contracts, you should consider naming a literary executor.
I legally protect my pen name, or the name of my mystery series? What
about my web site?
Many novelists use pen names or pseudonyms and many
also have a "branded" series of mysteries, usually named after the
chief character (e.g., Noreen Wald's "Kate Kennedy South Florida Senior
Sleuth" series.) What such writers have in common is the need to
protect the goodwill and value of their pen name and/or series. To
accomplish this, writers must understand both copyright and trademark
When filling out a copyright registration form (Form
TX), the Copyright Office allows you or your publisher to list either
just a pen name or your real name. The difference in protection is that
if you use your real name, protection for the work extends for your
life plus seventy years; if you use a pseudonym, the term of protection
is 95 years from the publication of the work, or 120 years from the
creation of the work, whichever period expires first. If, however,
after filing the original application in a pen name, the author's
identity is later revealed in the records, the term reverts to the life
of the author plus 70 years.
Under U.S. copyright law, however, names, slogans, and
titles cannot be copyrighted. This means that copyright will NOT
prevent others from using your pen name, or the name of your mystery
Pen names and series names, however, are entitled to
protection under state laws governing unfair competition and under the
federal Lanham Act, which prohibits "false designations of origin,
false descriptions, and dilution." These laws give you the right to
bring a civil action against someone appropriating your pseudonym or
Further, if a pseudonym or series name becomes
identified with the person using the name and/or the books and other
products authored under the name, it may be entitled to protection
under trademark law, although generally this is limited to the sale of
ancillary products. If you think your pen name or series name is
entitled to trademark protection, you should consult an intellectual
property lawyer; also see my article, "Do You Need A Trademark?" at
www.publishlawyer.com/carousel9.htm, which explains these concepts in
CAUTION: If your pen name also is the name of a living
individual, you must either obtain that person's consent or file a
disclaimer stating that the name is not that of any real person. Pen
names also cannot be registered if they are the name of a deceased
President of the United States during the life of the President's widow
except with the consent of the President's widow.
What about your web site name? Internet domain names
are treated differently under the law. Registration of your domain name
by the Internet Corporation for Assigned Names and Numbers (ICANN) is
separate from trademark registration. Nevertheless, you may be able to
register your domain name as a trademark, provided the name is being
used in connection with a site that is offering a service or product.
Can you tell me, once and for all, what exactly is "fair use?"
A. This is the single-most asked question of publishing
lawyers. Thanks to the wonderfully dense language of Congressional bill
writing committees, and the courts' interpretation of their efforts, it
is difficult to answer.
Section 107 of the U.S. Copyright Act provides that
"the fair use of a copyrighted work . ... for purposes such as
criticism, comment, news reporting, teaching (including multiple copies
for classroom use), scholarship, or research, is not an infringement of
copyright." Note that fair use is confined to these specific
categories. Section 107 nevertheless has been used to justify many
instances of uses outside the categories, and generated numerous court
cases. (Adding to the confusion is the unfortunate belief of many
writers that reproducing short excerpts of someone's copyrighted work
-- without permission - automatically qualifies as fair use merely if
attribution is given).
Section 107 further provides four "factors" to
determine whether a specific use is to be considered a "fair use."
These factors are:
the purpose and character of the use, including
whether such use is of commercial nature or is for nonprofit
the nature of the copyrighted work;
the amount and substantiality of the portion used
in relation to the copyrighted work as a whole; and
the effect of the use upon the potential market for
or value of the copyrighted work.
Much clearer, right? Of course not. These factors,
however, will determine whether your use of someone else's material
will be judged an infringement - or not. For example, say you wish to
use some Rolling Stones lyrics in your novel - perhaps a verse at the
beginning of each chapter. Let's examine the factors:
Is the purpose commercial or nonprofit? Definitely
commercial, and the commercial purpose is not in one of the specified
categories (e.g. a review in a newspaper).
The nature of the copyrighted work? Song lyrics, a
prime example of a work designed to be protected.
The amount and substantiality of the portion?
Depends on how much of each song you use. Let's say just one line - a
The effect of the use on the potential market?
(most important). Probably very little, since the lyrics have already
been published and can be found all over the Internet (on commercial
sites, no less).
The result? The four factors are split. Because the use
does not squarely fit within any of the Section 107 categories,
however, typically a court would find that, on the whole, the four
factors weigh against a finding of fair use (and that is why your
publisher will demand that you obtain permission for the lyrics).
The Internet, of course, has brought new confusion to
the issue. Abuse of the fair use exception abounds, but that won't help
you in the event you are sued. Until the day when either Congress or
the courts clear up this picture, play it safe - either don't use even
small portions of other persons's work - or obtain permission.
What is cross-collateralization, and is there a cure?
A. Cross-collateralization is an accounting concept
(stay with me here) used in publishing agreements (and also commercial
loans). It refers to the right of the publisher to charge your royalty
account for any amount owing to the publisher under any other
agreement. Unfortunately, many writers fail to understand the impact
cross-collateralization can have on their royalty income.
Let's say you have just submitted your third novel,
KILLING MADLY, to your publisher. Your first novel, KILLING SPREE, sold
well, but your second, KILLING FRENZY, earned out only $10,000 of its
Under the terms of your current publishing agreement,
you are to receive a $15,000 advance for KILLING MADLY, upon
acceptance. But when the check comes, it's only for $12,500 - the
publisher has deducted the $2,500 shortfall from KILLING FRENZY.
(Alternatively, the publisher might pay you the full $15,000 advance,
but after it is earned out, it deducts the $2,500 from future
Why? Because you have this clause (or one like it) in
your publishing agreement: "all Works covered by this Agreement or any
other agreement between Publisher and Author shall be considered one
account and shall be accounted for jointly or collectively."
What could you have done about it? Ideally, you could
have struck out the offending clause, usually found under headings such
as Payments, Royalties, Overpayment, or Accounting. Some publishers,
however, won't delete it, so you'll have consider the negotiating
points and issues:
If this is your first agreement with the publisher,
the clause won't matter until and unless you sign another agreement
with the publisher. You probably can allow the clause in the first
agreement, then push hard to have it deleted in the second contract.
Keep in mind that, unless your first book was somewhat of a success,
it's doubtful you'll get a second contract from that publisher anyway.
You also might try to "cap" the cross-collateralization to a specific
dollar amount, e.g., that no more than X amount can be setoff from any
If you are
offered a multi-book deal, consider
whether keeping the clause will leave you better or worse off versus
signing individual deals. In other words, is the guarantee of
publication from this publisher enough to outweigh the fact that one
ordinary book may soak up the benefits of commercial success in another
book? You might be better off selling to different publishers. You also
might try putting time limits on the operation of the
cross-collateralization clause: In other words, let the publisher
cross-collateralize only after an eighteen month or two year period
from the release of each book. This should at least prevent any amount
being take out of an advance for the next book.
You could try limiting the cross-collateralization to
specific editions of a book - i.e, only hardcovers can be
cross-collateralized against other hardcover editions, not trade
The key, as always, is reading and understanding all of
the clauses in your publishing agreements - even the ones that, at
first glance, may seem innocuous.
have formed limited liability companies (LLCs). What’s the
A. An LLC is a
partnership with the advantage of limited member liability and flexible
tax structure. Although a single-member LLC by default is
treated by the IRS as a sole proprietorship (income and expenses are
reported on Form 1040, Schedule C) you also may have your LLC treated
for tax purposes as a corporation (either a “C” or
Disadvantages of an LLC:
taxes. If you elect to have your LLC taxed as a
C corporation, tax rates are lower than individual rates, but when you
withdraw corporate profits as stock dividends, there is a double
taxation: it is taxed again at your personal rate. The sole
proprietorship or S corporation LLC, however, “passes
through” all income to the member, thus eliminating double
taxation entirely, but you cannot retain earnings in your corporate
account for future use.
taxes. As a sole proprietorship LLC member, you
must pay the self-employment tax of 15.3% on salary or
earnings. If you elect corporate status, the corporate FICA
and Medicare tax contribution, plus the employee’s FICA and
Medicare tax contribution, are equal. In some circumstances,
however, owner-employees of a non-corporate LLC (single-member or
partnership status) may end up paying more employment
taxes. For example, if a member of a non-corporate LLC earns
$65,000 in salary and is distributed $35,000 of the LLC’s
profits, a 15.3% tax would have to be paid on the full
$100,00. By contrast, if your share of S
corporation income is $100,000 in 2008 and you perform services for the
corporation reasonably worth $65,000, you will owe the 15.3%
self-employment tax on the $65,000 but not on the remaining
$35,000. (You also could choose to pay yourself a salary of
$65,000 and withhold 15.3% from your salary checks; the result is the
same). This is because the rules on the self-employment tax for S
corporations are well established: as an S corporation shareholder, you
pay the self-employment tax on money you receive as compensation for
services, but not on profits that automatically pass through to you as
a shareholder. CAUTION: The IRS has ruled (Revenue Ruling
74-44) that payments received from an S corporation in lieu of payments
of "reasonable" compensation to owners performing services for the
corporation ARE wages, subject to employment taxes. Check
with your tax advisor before taking this step.
benefits. An LLC choosing C corporation status
may deduct retirement benefits, medical insurance premiums and
reimbursements, qualified education costs, disability and group term
life insurance up to $50,000 per employee, and employer-provided
transportation benefits. A sole proprietorship LLC and S Corporation
LLC may deduct 100% of health insurance premiums, but there is lesser
deductibility of fringe benefits and smaller retirement plan
contribution limits and plan flexibility.
and Paperwork. There are initial and annual fees
to the state where you set up your LLC, and your state may impose a
minimum tax on your LLC, no matter how much (or how little) income you
have. If you choose C or S corporate status (or are a
multi-member LLC), a separate tax return will be necessary, and you can
count on a larger bill from your accountant.
Liability. Being an LLC will protect
you personally from certain creditor’s claims against the
LLC. Freelance writers, however, rarely accumulate much
business debt – and most lenders will require that you
personally guarantee the payment of an LLC loan in the event of a
default or bankruptcy. More importantly, even if you assign
your copyrights to a limited liability company, you cannot avoid
copyright infringement, defamation, or invasion of privacy lawsuits
– as the author, you always can be sued individually for
these “torts.” Likewise, publishers
routinely require authors to personally pay the publisher in the event
of a defamation or copyright infringement claim resulting from the
In summary, there are some tax and fringe benefits to
be gained by choosing to form an LLC and electing corporate status,
especially if you generate high income and can afford expensive
benefits and high pension contributions. Likewise, if you
self-publish and accumulate large debts in the name of your writing
business, the limited liability of the corporate entity may be useful.
Tell me about legal issues in literary agency agreements.
A. First, you should be aware of the
difference between an
“exclusive agency agreement” and an
“exclusive right to sell” agreement (such as a real
estate broker listing agreement). Most literary agents use
the former. Under an exclusive agency agreement, you still
may make a deal with a publisher on your own without paying your agent
(although you probably will want to refer the publisher to your agent
for negotiation anyway). By contrast, an exclusive right to
sell agreement means that you have to pay a commission even if you make
the deal by yourself.
Second, some literary
agencies include in their author-agent agreements
or in the book publishing contracts which they negotiate an
“interminable agency” clause. Rather than
limit their right to representation during the term of your agreement,
such clauses grant the agent an exclusive, irrevocable right to
represent your work for the entire term of those works’
copyright. This is inappropriate and can cause you and your
heirs needless trouble. The agency will be entitled to a
commission on your work even after it goes out of print from the deal
the agent negotiated and your new agent sells the work to another
publisher. After your death, your executor would have to keep
track not only of which of your works are still under contract, but
will also have to determine whether an agency has an interminable right
to represent any of your out-of-print works. Your agency may merge,
dissolve, or change names, providing more complications for your
Similarly, a few agents
use the phrase “agency coupled with
an interest” in their contracts. This is a bit of legalese
intended to make the agency relationship irrevocable (again!).
Ordinarily, a principal may terminate his or her agent at will (or at
the end of a contract term), and the agency terminates automatically on
the death or disability of the principal. This clause, however, grants
the agent the exclusive, irrevocable right to represent your works for
the entire term of those works’ copyright. Even if you
terminate the agency, and the rights to your book revert back to you
from the publisher, you are obligated to pay the agency a commission
forever for all future sales, even if the agency did nothing to cause
that sale. It could even mean you would be paying two agency
commissions, which could amount to thirty percent or more. This also
would apply to your heirs.
Third, some literary
agency agreements give the agent power to sign
contracts and checks on the author’s behalf. This
clause always should be deleted; if necessary, you can give your agent
this power when and if there is a good reason to do so, such as your
unavailability for a period of time..
Finally, your agent
should not be permitted to
“assign” (transfer) your agency agreement to
another agency without your permission. Likewise, you should
not be transferred to another agent within the same agency without your
What should I know about “out of print”
A. Your grant or
assignment of copyright to your publisher generally is limited only by
therefore is critical that
“out of print” be defined reasonably, especially
now that digital and on-demand
publishing can make the literal meaning of the clause obsolete. Ideally, the definition
should be pegged to
the publisher’s marketing efforts, not just to the
book’s availability—when the
book no longer is in the publisher’s catalog and/or available
chains, it should be considered “out of print,”
regardless of whether it still
can be bought online.
Unfortunately, many out of print clauses are vague,
suggesting only that when a book is no longer
“available,” the author may ask it
be declared out of print, and the publisher must respond within a
frame – usually six months – by either issuing a
new edition or returning the
rights to the author. But
may be no print copies available (and the book remaindered), if the
web site or Amazon still lists an e-book version or POD version,
Some other variations of the clause may state that a
is declared “out of print” if there are fewer than
a certain number of books
left in circulation, or if your royalties fall below a certain amount
or more accounting periods, or if less than a certain number of e-books
books are sold in a year.
All the above versions of out of print clauses should
anathema to any author. It’s
your best interest to have your rights tied up by a publisher
who’s no longer
doing anything with them. Once
publisher no longer actively is marketing your book and the book has
selling in decent quantities, your best bet is to get the rights back
either resell the rights to a new publisher (difficult, but not
self-publish the book (POD publishing is great for this), or cut it up
the serial rights to magazines or anthologies, or so on.
Therefore, when negotiating your publishing agreements,
try to get the following clause, or some close version into the
modify the publisher’s clause accordingly):
“Out of print” is hereby defined as
the Work not being
available in the United
through regular retail channels in an English language print edition
print-on-demand or other electronic means of reproduction) and listed
Publisher’s marketing catalog. If
time the Work is out of print during the term of this Agreement, Author
terminate the Agreement by written request to the Publisher. Within thirty (30) days of
receipt of the
request, the Publisher will return all rights in the Work to Author,
any prior grants of rights authorized and the continuing right to
Publisher’s share of any future proceeds from those grants. If Publisher fails to
provide a written
reversion of rights, Author may record this page of the Agreement with
United States Copyright office in lieu of such written
Q. My publishing contract
provides that I
“indemnify and hold harmless” my publisher from all
claims. That sounds
A. It is.
and warranty clauses in book contracts frequently are skimmed over and
fully understood by authors, agents, or editors.
These clauses set forth the respective
responsibilities of the parties in the event of claims against the
publisher for defamation, copyright infringement, invasion of privacy,
violation of rights of publicity, and other
“torts,” or civil wrongs.
Drafted by the publisher’s lawyers, they
often are overbroad and publisher-slanted to a ludicrous degree.
general, the warranty clause is the author’s promise to the
publisher that her
work is original, and further does not defame (libel) any individual,
invade anyone’s right of privacy or right of publicity. To
give this promise
teeth, the publisher also includes an indemnification clause, which is
author’s agreement to reimburse the publisher for any damages
suffered by the
publisher if the author’s warranties are false. This is
required even though
all but the smallest publishers carry “publisher’s
perils” insurance policies
that will cover the publisher for such claims.
can you do about it? Ideally,
get the following underlined words inserted in the standard
clause: “The Author will indemnify the Publisher against any
loss, injury, or
damage (including any legal costs or expenses and any compensation
disbursements paid by the Publisher) occasioned to the Publisher in
with or in consequence or any breach of the Author’s
warranties and which
the Publisher is not able to recover under its insurance policies.” In most cases, this will
your potential liability.
Unless you are
a best-selling author, however, it can be difficult to get this change:
and editors treat their indemnification clauses as sacrosanct, handed
Moses-like, from “Legal.”
There are some
changes, however, to which many publishers will agree.
Most successful authors should be able to get
their publisher to make them an “additional
insured” on the publisher’s
insurance policy. This
means that the
author, as well as the publisher, are covered by the
policy. In that
case, unless your
actions were intentional, the most you could be personally liable for
event of a lawsuit would be a share of the insurance policy’s
(typically, not more than $10,000).
requests you can make: 1) ask that a “best of your
knowledge” standard be added
to your warranties. This
you from inadvertent errors or omissions.
2) Ask that your indemnities take effect only upon a
final judgment --
insert the words “finally sustained” after the word
“damage” in the above
sample clause. By
doing so, you will
ensure that you will not have to pay the cost of frivolous lawsuits. 3) Ask that your publisher
be required to give
you notice of any claim and consult with you before settling any claim.
Q. Tell me about option clauses.
These clauses traditionally give publishers the
right to either buy or
make an offer for the author’s next book or books. Of course, if your novel
sells well, there’s
something to be said for loyalty to the press that helped you get
and agents alike complain that
writers tend to jump ship after they’ve helped make the
writers successful. The
option clause, therefore, is a bit of an insurance policy for the
you have to give them another shot after they invested in you. It’s not usually
an evil clause in its intent,
but there are too many situations where the clause becomes impractical.
The problem is
that when you enter into the publishing agreement, you don’t
know whether your
current book will sell well, and whether the publisher will do a good
editing and marketing it. Further,
if your next book isn’t appropriate for this publisher? You decide to write a
thriller, and your current publisher specializes in cozies. You’d have to show
your historical to them, and
they could hold you up from submitting it to appropriate publishers.
Best advice –
eliminate the option clause entirely.
Many authors are surprised to learn that publishers
will agree to delete
it – but
you have to ask! If
you can’t eliminate it, however, make sure
it imposes no real burden. Get
any contract language requiring you to submit a completed manuscript,
than a proposal; lengthy (more than 60 days) consideration periods for
publisher; and a requirement that you offer your next book to the
the same terms as the current book. (What if your first book is a
and now you can command a much higher advance and royalties?)
should aim at setting up a very limited period during which the
bid on your next book (“right of first
negotiation”), and permitting you to
sell the book to other publishers if the publisher isn’t
don’t accept any clause that stipulates
you can’t accept an offer from another publisher if
it’s not on “better terms.” That may sound logical, but
Publisher A offers you more money up-front, while you trust Publisher B
to do a
better job at marketing? Or
prefer to try a smaller publisher that can’t pay as much, but
can show you more
personal attention. You should always have the right to refuse your
offer, no matter what the terms are, if you choose. All the first
do (if you have to include it) is give the publisher a right to read
and make an offer.
want to restrict the definition of “next work.” Make sure
it’s limited to the next work in
the same genre, or in the same series, or the next work
that’s in categories
the publisher deals with. And
make sure the
option is for no more than one book.
well-restricted clause can be an annoyance because it wastes your time.
long-term, and never be afraid to
I turned in my book’s manuscript on time
three months ago, but my editor still hasn’t
What are my rights? And can my publisher make
changes without my approval?
As always, your publishing agreement
publishing agreement typically gives the publisher the right to accept,
or ask for revisions in your manuscript. But
keep in mind that the editor who acquired
your book may not be the same editor who sees it through to
publication; we all
know that editors change publishing houses frequently.
If a new editor comes in before your
manuscript has been accepted, he or she might just sit on your book
projects take priority. You
assurance that the publisher: a) won’t unreasonably delay
production of the
manuscript or payment of your remaining advance by never getting back
about what changes the editor wants; and b) can’t reject the
outright without giving you a chance to revise the manuscript.
The solution is to insert a contact clause such as
“Within 45 days of its receipt of the complete manuscript of
the Work, the
Publisher shall notify the Author in writing whether or not the Work is
to Publisher. If
the Work is not
acceptable to the Publisher, the Publisher shall give the Author a
changes and/or revisions. The
shall have 60 days from the Author’s receipt of such a
request to deliver to
the Publisher a revised Work that is acceptable to the Publisher. The Publisher shall advise
the Author within
45 days of its receipt of the revised Work whether or not the revised
acceptable to Publisher. If
the Work as
resubmitted is deemed unacceptable, the Agreement shall be terminated
option of either party and neither party shall have any further
the other. If the
Author does not
receive any notice from the Publisher within the 45-day periods set
above, the Work shall be deemed to have been accepted.”
Although some publishing agreements already will have a
time limit for the publisher’s acceptance, they will require
YOU to notify an
editor and/or an executive of the house that “failure to
respond shall be
deemed acceptance.” If
so, make sure you
follow the specified procedure: Failure to do so will leave you in
Also, who gets the final say on the manuscript after
contracts allow the
publisher to make changes “provided the
meaning of the text is not materially altered.” In
whose view? Generally, a
publisher should only have the right to make copyediting
You should have the right to approve all
material changes to the manuscript before publication.
I negotiate the
date of my book’s publication?
A. Yes! There always should be a
limit to the amount of time a publisher has to publish your work. If no time frame is
specified, you run a
significant risk: What if the publisher runs into monetary problems, or
reorganizes the types of books they publish?
Or maybe they’re not even really sure if
they want to publish it
anymore, but they’ve already paid your advance, so they think
they should hang
onto it just in case. And
publisher may buy a book that stands to compete with a book
they’re about to
publish (or have already published), then purposely hold it, or fail to
it, because it may interfere with the success of the other book.
Your publishing agreement should
stipulate that the publisher has somewhere between 12 and 24 months to
the book after the publisher has accepted the manuscript (you also
a time limit for manuscript acceptance -- see “Manuscript
Revision” in the June/July 2007 issue of The Third Degree). Always aim for the
shortest time possible
while understanding that you probably don’t want the publisher to rush
your book to print in less than
six months. First
novelists should be
aware of the many steps that need to be taken care of before a book is
released: editing, copy editing, typesetting, proofreading, cover
endorsements, catalog inclusion, listing with Books in Print, press
advance review copies to the trade, etc.
Twelve to 18 months, at maximum, is plenty of time.
Sometimes the problem isn’t even
the publisher’s “fault,” but a shift in
the market. For example, many thrillers
about terrorism were delayed after 9/11. Then
there are the “force majeure”
(“Act of God,” unavoidable catastrophe) problems:
What if the publisher’s building burns down, or
there’s a flood, earthquake,
hurricane, or other such emergency that forces the publisher to delay
book’s production? In
such cases, the
author always should have the right to take the book back if the
doesn’t show plans to get the book released right away once
problem has ended.
Here’s a contract clause that
will accomplish this goal:
the Publisher does not publish the Work
within the time specified above for reasons other than first serial or
club use, delays of the Author in returning the copyedited manuscript
proofs, the Author’s failure to comply with requests made by
counsel or delays, caused by circumstances beyond the
Publisher’s control, and
if the Publisher at any time thereafter receives written notice from
demanding publication, the Publisher shall within 90 days of the
receipt of such written demand either publish the Work or revert to the
in writing all rights to the Work granted to the Publisher in this
subject to any outstanding licenses, which shall be assigned to the
the Author shall retain any advance payments made under this Agreement
such reversion as liquidated damages for the Publisher’s
failure to publish the
Q. What rights should I grant
The standard book publishing
agreement “Grant of Rights” clause commonly takes
all “print” rights plus
certain specified “subsidiary” rights –
foreign, translation, book club,
electronic, film & television, audio, dramatic, and periodical.
skim over these clauses — they are the
most important elements of your publishing agreement.
Examine them closely, and, if necessary,
consult a publishing lawyer or literary agent.
Unless there is
a specific reason not to do so, you always should try to retain as many
rights as you can, keeping in mind that certain rights are considered
“non-negotiable” by publishers
audio, electronic, and book club.
On the other hand, even first novelists
should be able to retain either film/television, or
both. Film/television rights, of course, allow your book to
be made into a
movie or television show. These are
rights I always advise authors to keep for themselves. They can be
sizeable chunk of money, and under the typical publisher subsidiary
clause, if the publisher makes the sale, the proceeds of the sale are
between you and the publisher. Further,
under a typical literary agency agreement, you also will owe your agent
your 50%! Finally, if the publisher
controls the rights, it makes all the decisions; you don’t
get to negotiate the
On the other hand, if you retain film
& television rights, and a movie studio or producer makes an
offer, you or
your agent get to negotiate the deal, and you don’t owe the
publisher any money.
Foreign publication rights give the publisher the right
to license your
book to foreign publishers (“foreign” being defined
by the “Territory” in the
agreement). Translation rights give the publisher the right to have the
into other languages. Should you give
these rights to the publisher? Some
publishers do aggressively pitch their books to foreign publishers, so
be in a position to make more sales than you or your agent
In that case, it’s not bad to split the
money—they do the work, and you just collect extra
If you don’t have an agent, though, you have
to do the legwork and contact foreign agents or foreign publishers
yourself. In some cases, the publishers will come to
you: if your book does very well in the United States, chances are
will be watching to offer you a deal to print the book abroad (in
translated into other languages).
The main problem is that it’s hard to
determine how aggressive your
publisher may be with exploiting foreign rights. The secondary problem
if you let the publisher keep foreign rights, they’re the
ones who get to negotiate
and determine the deals, and you have to agree to them. They could
sell French rights to your book for $100, and you couldn’t
turn it down.
Bottom line: make sure you understand the rights you
are giving your
publisher, and don’t be afraid to negotiate.
me about royalties in book contracts.
Royalty rates may vary wildly in the
contemporary book publishing industry; however, typical hardcover rates
- 15%, with “break points” that escalate the
royalty as more copies are sold;
e.g. 10% on the first 5,000 copies, 12 1/2% on the next 5,000, and 15%
generally have between a 6% and 9% royalty, sometimes at a
“flat” rate without
break points. Trade
format) formerly carried the same royalty rate as hardcover, but
this no longer is true. Many
of the big
publishers, such as Simon & Schuster, now give trade paperback
royalty range as mass market.
More important than
the percentage amount, however, is what
the percentage is based upon. Fiction
publishers generally use an author-friendly list or cover price
some major exceptions, like Sourcebooks, which uses a “net
receipts” formula. This formula is based on the
publisher's actual receipts after discounts, rather than
the cover price. Under such a formula, you
will receive less royalties – often half as much -- as a
“cover price” author
would receive from the same amount of sales.
The deep discount. Most publishing agreements
provide that an
author’s royalty is reduced for certain
“discounted” sales -- sales at greater
than the publisher’s “normal wholesale
discount” or “greater
than a 50% discount.” The
reduced royalty rate for deep-discount
sales may be either one-half the stipulated royalty or a percentage (7
to 10 percent) of the publisher's net receipts. Originally,
this clause was meant to apply to
non-returnable quantity special sales that a publisher made at a high
to purchasers outside normal book-purchasing channels (such as premium
export sales, direct-mail sales, or sales on a non-returnable basis). But guess what? Many
publishers now apply the
clause to normal bookstore and wholesale sales.
Since many --sometimes most-- books are sold to
bookstores and to Amazon
at a discount rate of 55 percent, and to big discounters like Wal-Mart,
and clubs like Costco, at over 65%, this clause in effect guarantees
author's royalty rate always will be reduced. (Discounts also can be
for mass market paperbacks, e.g., 60 to 65%.)
The solution? Some
writers and agents request a copy of the publisher's current discount
before agreeing to royalty schedules – but the publisher can
try to increase the
percentage above which your royalties reduce, the higher the better. In the example above, changing the percentage to
56% would protect
you from a reduction for sales to Amazon and some of the bookstore
not from the big discounters. A
alternative is making sure the clause only applies to its original
“special” sales. To
do this, add
language to your discount clause specifying that your publisher will be
apply the reduced royalty rate only to “sales outside normal
retail trade bookselling channels.”
me about royalties for subsidiary
Authors (and even agents)
sometimes overlook subsidiary rights royalty clauses.
This can be a big mistake; significant
revenue can be derived from such rights.
First, a definition:
rights (often called “subrights) are any right to use content
from your work that
is subsidiary to the primary right of print publication, including
articles, film and video, audio, foreign sales and translations, DVDs,
clubs, electronic rights, reprints, merchandising, etc.
Any rights which you have not retained may be
exploited by your publisher, either by itself (the big publishers
their own audio and electronic publishing divisions), or by licensing
rights to other companies.
If your publisher exploits
subrights itself, you should expect a percentage royalty, just as with
print rights. The
amount of such royalty
and what it is based on (net receipts vs. list price, see my previous
about royalties) always should be reviewed.
Typically publishers will insist on net receipts AND
a flat royalty rate
(e.g. 10% for electronic or print-on-demand, although the cost of
lower than print). Don’t
be afraid to
negotiate these terms.
such as foreign, film, or audio rights retained by the publisher and
to a third party, the standard royalty to the author is one-half of the
receipts from such licenses, with some exceptions.
(For example, first serial rights should be
90% to the author, 10% to the publisher.)
It therefore is critical to define “net
receipts” carefully to eliminate
any creative bookkeeping by the Publisher.
Ideally, the definition should be this simple:
“Net Receipts” refers to all
funds received by the Publisher for the sale or license of the
subrights, the author should insist that advances received by the
the licensee also are split, and further require that the
author’s share of any
advance received by the publisher for a subrights license be remitted
author within thirty days of receipt.
agreements also often have “special categories” of
subrights – basically ways
to cut the author’s royalties further.
For example, book club rights – in many
agreements, an author's share of
royalties on sales to a book club is not the standard one-half of net
but instead a percentage of the author's normal print royalty rate
50%). The theory
behind this is that the
publisher is receiving from the book club publisher a lower rate than
bookstore sales. This
is true, but on
the other hand, the publisher has no costs, either – the book
club publisher prints
and markets its own edition. And
cases, the book club publisher is actually owned or controlled by your
always try to get
book club rights included with the other licensing subrights
– you then will
receive one-half of the publisher’s net receipts instead of a
rights royalty clauses should never be ignored; make sure you
you are giving up and what you are gaining, and don’t be
afraid to negotiate.
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