Sunday, August 19, 2018

Publishing Contracts: Where Lies the Danger for Indie Publishers?

When the owner of an independently operated publishing company wishes to cash out, they will need to establish the value of the business they have built. The sale price will be based on the discounted cash flow of the company, and, ultimately, the soundness of its author agreements. Many start-ups are poorly financed, and in the beginning the owners have neither the time nor foresight to focus on their most important asset, their author contract template. This error at the outset of a publisher's career can frustrate their ability to sell the company in later years.

Problems often arise when publishers borrow an agreement found online.  Lacking  legal acumen, a start-up publisher may delete important provisions that they do not fully understand - or inadvertently carry forward a "poison pill."  For example, an anti-assignment clause.   Generally, a contract is fully assignable unless it contains such a clause. 


Sample Anti-Assignment Clause
Sinclair Lewis' "Kingsblood Royal"
Experience is a hard school.   To illustrate:  Owen, a successful independent publisher, with a backlist of 65 books, decides to sell the assets of his company.  In his late-50s, with no children to take over the business, his exit strategy is to bankroll the sale of his growing company into an early retirement.  As part of the seller's due diligence process he compiles all of the company’s author agreements, foreign translation licenses, financials and other important documents for a prospective buyer to review. To his dismay, his attorney and broker call to say the deal has gone south because the publishing agreement he filched off the Internet when money was tight, contains a non-assignment clause.  The clause reads, “Neither this agreement nor any right or obligation hereunder may be assigned or delegated, in whole or part, by either party without the prior express written consent of the other. 
  What should have been a straight forward business transaction, now requires the consent of all of Owen's authors, and in one instance, all of a deceased author's uncompromising heirs. Plus, the author of the crown jewel of Owen's backlist (which generates 50% of the company's gross annual revenue) will use the pending sale to renegotiate her contract -- a contract she desperately wants to get out of.  Is there a way around the discretionary power Owen inadvertently invested in his authors?  Perhaps.  

There are two ways to buy a company.  Stock sales and asset sales.  In certain states the acquisition of stock in the target company will not violate an anti-assignment clause.  However, buyers prefer assets sales.   

If an agent, or author, wishes to insert an anti-assignment clause in your agreement, resist.  Or, consider carving out exceptions for the sale of substantially all of your company's assets, or the sale of the company to a related company.  
TIP:  If you change a boilerplate contract clause for a particular transaction, be careful not to use the revised contract as a template for future deals, unless that is your express intention.
While there are publishing programs at many universities, and organizations such as the IBPA to educate future publishers, at best you will receive an introduction to contracts.  When starting out, don't hesitate to hire a lawyer familiar with the industry.  There are a fair number of attorneys across the country who are intimately familiar with the book publishing industry.  You can't afford not to call one of them.   

If you want to succeed as a publisher you must have a well drafted author-publisher agreement.  Then, through persistence and luck, you are in a position to make the most of the opportunities ahead. 

Lloyd J. Jassin is a publishing attorney and entertainment lawyer.  He counsels clients on contract, licensing, copyright, trademark, unfair competition, defamation, right of privacy and general corporate law matters. His practice includes drafting and negotiating publishing and entertainment industry contracts, intellectual property due diligence, trademark prosecution, dispute resolution and litigation. A graduate of Benjamin N. Cardozo Law School, he is co-author of The Copyright Permission and Libel Handbook (John Wiley & Sons).  He can be reached at 212-354-4442 or via email at Jassin@copylaw.com.


Related Blog Post

A Helpful Checklist for Book Contract Negotiations

Contact:

Law Offices of Lloyd J. Jassin
The Paramount Building
1501 Broadway, Floor 12
New York, NY 10036
212-354-4442 (tel.)
jassin@copylaw.com (email)
www.copylaw.org


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(c) 2018.  Law Offices of Lloyd J. Jassin. 


Monday, May 28, 2018

Estate Planning and Copyrights

 By Lloyd J. Jassin & Ronald M. Finkelstein

After you have ceased to be, or in the words of Monty Python, "run down the curtain and joined the bleedin' choir invisible," your copyrights -- like many a pet parrot -- will long outlive you.

For works published before 1978, copyrights endure for 95 years from the date of first publication.  For works created after 1977, copyright lasts for the life of the author plus another 70 years.  Coincidentally, cockatoos and Amazonian parrots can reach the age of 75.  Can they own a copyright?  Until recently, this was a puzzler.  Currently, no.  But, we digress.

Who Will Manage Your Literary Legacy?

This article is about the positive steps you can take today to ensure the impact of your words will not lessen with time. 

While during your life you may be able to play catch-up with legal formalities, unless you have a well-drafted will, or have created a valid trust (or both) for the benefit of others, you have left the ownership and care of your creative legacy largely to chance.

The responsibility of finding a long-term, nurturing home for your copyrights, records and papers, should not be left for the last minute.   Ideally, authors should name a "Literary Executor" in their will.  An "executor" is a person responsible for settling a deceased person's estate. Among the duties of a General Executor (as opposed to Literary Executor) are contacting an attorney to file a petition for probate of the will; collecting debts owed to the estate; filing for life insurance and other benefits; contacting an accountant (or attorney) to prepare the decedent's final income tax returns, a federal estate tax return and state estate and inheritance tax returns as may be required; and notifying the beneficiaries named in the will. 

A Literary Executor, as opposed to a General Executor, is the
F. Scott Fitzgerald's Will
person selected for the limited purpose of managing your copyrights when you pass on.  

One court described the Literary Executor's role as "requir[ing] a delicate balance between economic enhancement and cultural nurture." If you have made the appropriate provisions in your will, your Literary Executor will distribute all of the literary property that you owned at the time of your death, and can manage your literary estate on an ongoing basis.  

The Literary Executor, acting on behalf of the beneficiaries under your will (e.g. family members, a designated charity, a research library or archive), will be responsible for entering into contracts for exploitation of your copyrights and other intellectual property rights, collecting royalties, maintaining your copyrights and legacy, and (where appropriate) donating your letters, unpublished manuscripts, and other literary materials to a library, special collection or historical society. 
Unlike a general executor who gets the deceased's estate ready to distribute, the literary executor's job is not for a limited time.  It is coextensive with the life of the copyright.
Because of the changeable nature of copyrights (e.g. revised editions, film adaptations) the duties of a Literary Executor, or Literary Trustee, projects decades into the future and are ongoing. 

Be forewarned.   Copyrights are complicated.  Some degree of legal competence is required.  For example, a literary executor is trusted to advise the author's heirs on the process of copyright termination.  Sections 203 and 304 of the Copyright Act gives the author's heirs the inalienable right to terminate transfers of copyright made during a deceased author's lifetime.   The mechanics of the termination process are astonishingly complex.  Notices must be served within a prescribed period.  If the author's heirs miss the window, or file an improperly drafted notice, the grant or transfer continues in full force for the life of the copyright.    

Selecting a Literary Executor

A General Executor will often be a spouse or other family member that does not have experience with literary matters. Therefore, you should consider entrusting the care of your papers, existing contracts and unpublished manuscripts to a Literary Executor. 

By taking the time to carefully select a Literary Executor, you lessen the likelihood of infra-family disputes over control of your work or works.   Family squabbles over copyright control can easily frustrate the ability of scholars, publishers and producers who want to quote, publish or produce your work.  And, if your final wish is that your unfinished play based on your aunt Hilda's lesbian affair go unpublished or un-produced, you can provide in your will that your Literary Executor destroy your manuscript after your death. By way of example, Ernest Hemingway (1898 - 1961) made it clear during his lifetime that he did not want his unfinished and unpublished story fragments and manuscripts published after his death. However, since his will was silent on the subject, his estate edited and released not just his early stories, but  three unfinished novels (one of which was a posthumous collaboration with his son, Patrick).  All three were reviewed poorly.

Ideally, your Literary Executor should be someone who understands how the copyright industries operate. That person should also be comfortable with negotiating contracts, or savvy enough to hire an attorney.  Many times that person will be a literary agent, or a publishing attorney .  As mentioned previously, your Literary Executor should also be someone who will carry out your intentions. And, since all things come to an end -- including Literary Executors -- you should provide in your will for a replacement when the estate's Literary Executor dies or becomes incapacitated.

Defining the Literary Executor's Duties


Because the duties and powers of a Literary Executor are not defined by statute, it is imperative that the person drafting your will take great care in describing the scope of your Literary Executor's duties. The powers of a Literary Executor should be as broad and comprehensive as possible, unless, of course, you believe there should be limitations, qualifications or conditions imposed upon your Literary Executor (e.g., different executors appointed for book publishing and theater-related matters).

In preparing the powers of a Literary Executor, you must consider the following questions: 

  • Will the Literary Executor have the sole and exclusive right to make all decisions regarding appropriate publication, republication, sale, license or other exploitation of your work? Or, should she merely be appointed as an advisor to the General Executor?
  • Will the Literary Executor be responsible for preparing unfinished or unpublished manuscripts for publication and seeing those works through publication? 
  • Will the Literary Executor have the right to terminate copyright licenses?
  • Will they have the power to destroy any letters or papers they believe should be destroyed? 
  • In return for their services, will the Literary Executor receive a fee or commission for their services? What is fair compensation? What about reimbursement for expenses? 
  • Will the Literary Executor be required to maintain a separate bank account for such monies? 
  • Will the Literary Executor have the sole right to sue for infringement of copyrights? 
  • Will the Literary Executor have the authority to pay accountants attorneys, agents, subagents and others? 
  • In the event the Literary Executor is unwilling or unable to perform her duties, what are the provisions for appointing her successor? Or, will the General Executor assume those duties?
While a family member may agree to work for free, attorneys and literary agents will most likely seek a fee of between 10% and 15% for new contracts they negotiate on behalf of the estate. With regard to administering existing contracts, fee arrangements can vary greatly depending upon the size of the literary estate and the responsibilities of the Literary Executor.

The Literary Trustee 

In some instances, an author may create a lifetime (“inter-vivos”) trust and transfer literary assets to the trust. In this case, a trustee will be appointed to carry out responsibilities similar to an Executor. In such instances, the author appoints a "Literary Trustee" who acts in much the same manner as a "Literary Executor" would under a decedent's will. Furthermore, if an author names trusts as beneficiaries under his will and literary assets will be transferred to such trusts, then the author must also name, in addition to a Literary Executor, a Literary Trustee (who would be the same person) in order to continue acting in such a capacity after the literary assets have been transferred to the trusts.

Valuation


If you have accumulated enough wealth so that your assets will be subject to an estate tax upon your death, then the Executor will be responsible for valuing all of your assets at that time, including manuscripts, copyrights and contractual rights derived from the publication and reproduction of your works. The Executor (or Literary Executor, as the case may be) should hire an appraiser with significant experience in appraising -- or valuing -- these interests. Authors with significant estates should meet with their attorney or accountant now to determine whether any lifetime planning can be employed to reduce the value of their estates at their death so that more assets can pass to their heirs.  

We recognize that most people don't like to talk about their  mortality. Our advice is don't remain nailed to your perch.  Tend to your copyrights now.  If you have questions about copyrights and estate planning, please feel free to contact us. 

(c) 2002 -2018 Lloyd J. Jassin and Ronald M. Finkelstein


Lloyd J. Jassin, JD is a publishing attorney. He counsels clients on contract, licensing, copyright, trademark, unfair competition, libel, right of privacy and general corporate law matters. His practice includes drafting and negotiating publishing and entertainment industry contracts, intellectual property due diligence, trademark prosecution, dispute resolution and litigation. He is a graduate of Benjamin N. Cardozo Law School, and is co-author of The Copyright Permission and Libel Handbook (John Wiley & Sons).  He can be reached at 212-354-4442 or via email at Jassin@copylaw.com. 

Ronald M. Finkelstein, JD, CPA, is a Tax Partner at Marcum, a nationally recognized accounting firm, and national Co-Partner-in-Charge of their Trusts and Estates Practice group. He can be reached at 631-414-4370 or by e-mail at ronald.finkelstein@marcumllp.com, or you can visit his firm's website at www.marcumllp.com)

NOTICE: This article discusses general legal issues of interest and is not designed to give any specific legal advice pertaining to any specific circumstances. It is important that professional legal advice be obtained before acting upon any of the information contained in this article.



Resources
Writers Wills: A Rich Legacy (article / The Guardian)
William Shakespeare's Will (PDF)
Jane Austen's Will (PDF)



 

Friday, October 28, 2016

I'm a Copyright Attorney, Not a Sorcerer

Several weeks before Bonnie Foreman's death, I watched her
laughing and joking as she downloaded a pirated copy of my book, The Copyright Permission and Libel Handbook: The Cursed Edition. She read a lot and drove too fast. I said I'd give her six weeks to live. The autopsy carried out on her body was in-inconclusive. But, here's what I can tell you. She expired around page 36. Somewhere between out-of-print works and special fair use situations. Curse or coincidence? I cannot say for sure. I'm a copyright attorney, not a sorcerer.  What I do know, it wasn't the copyright notice that did her in. 

What takes place within us when confronted by a curse? You read the text carefully and are forced to reflect on what you are reading, and your mortality. 3,000 years after his death, King Tutankhamen's curse still conjures up fear (unlike copyright notices).  While a 3,000 year old curse will retain its potency, copyrights wither and fall into the public a mere 70-years after an author dies.  From the standpoint of being an effective deterrent, it doesn't help that copyright notices resemble frown emoticons resting on their  side.   

Do you wish to protect your intellectual property, but don't have the means to hire a lawyer?  Gory, gruesome, nasty, cautionary, score settling curses were once used to stop book thieves and plagiarists in their tracks. Unlike the copyright notice, which simply proclaims  "I own this" (with reservations), curses make it abundantly clear that some form of adversity or misfortune will befall the person who ignores it.

While there are some issues to iron out, I have come to believe that a mix of legislative solutions, works licensed under Creative Commons licenses, and cursing, can offer a workable solution to an internet that wants to be free, and authors, composers, dramatists, and visual artists who want to eat. 

Old sorcerers wrote the following ancient warnings. While dormant for years, these precursors of the modern copyright notice, are a creative and cost effective way to protect your intellectual property.    

In Biblioclasm, a book about the magic powers of the written word, the author identifies the following as the most famous literary curse.  It still has what it takes.
"And if any man shall take away from the words of the book of this prophesy, God shall take away his part out of the book of life, and out of the holy city, and from the things which are written in this book." -- Revelations, 22:19

Aleppo Codex
The Christian church didn't have a monopoly on literary curses. Medieval Jewish scribes issued stern warnings against modifying even a single letter of the Hebrew bible, since each of the 304,805 letters that comprised it had divine meaning. The following lines written C 984, appear at the end of the Moshe Ben-Asher Codex, the oldest medieval Hebrew bible:

"Whoever alters a word of this mahzor or this writing or erases one letter or tears off a leaf . . . may he have neither pardon nor forgiveness; neither let him behold the beauty of the Lord. He shall be like a woman in impurity and like a leprous man, who has to be locked up so that his limbs may be crushed, the pride of his power broken, his flesh consumed away that it cannot be seen, and his bones that were covered made bear."
This warning concerns the integrity of the text, not theft. Under copyright law, the exclusive right to adapt or alter the text usually resides with the author, not the owner of a particular copy of a work.  Elsewhere in the Moshe Ben-Asher Codex, atop certain pages, it reads, “Sacred to Yahweh, not to be sold or defiled.”  Personally, I think disgorgement of profits (a remedy under copyright law) better fits this type of crime than broken bones or necrotizing fasciitis.  That said, nothing beats the Nazi face melting scene from Raiders of the Lost Ark.  

The curse begat the copyright notice 


Medieval colophons, the antecedent to the copyright notice, appeared, initially, as concluding statements at the back of manuscripts. The colophon would indicate the work's title, the scribe or copyist (not the author), date and place of copying, and contain either a blessing or a curse. So, while a direct connection between the colophon and copyright notice may appear fuzzy, the common assertion of ownership rights, and threat of consequences for those who violate those rights cements the connection in my mind.

To get the most out of a curse (or a copyright notice), it must be displayed prominently

Geoffrey Galister, in the Encyclopedia of the Book (Oak Knoll/British Library), explains that by the early 16th Century, the practice of placing a colophon at the end of a book was largely abandoned. Instead of the scribe's name appearing at the back of the book, the printer's name (and its royal license to sell the work) appeared on the title page where it could be more easily seen. Makes sense. Copyright law provides for more potent penalties against willful or knowing infringers, than innocent ones. Similarly, with a curse, knowing you've been cursed, makes the curse more potent. However, "[M]any Witches and sorcerers claim that curses can be just as effective without the victim’s knowledge of them." See, Mystica. Being an "Eye of newt, and toe of frog" kind of guy, I recommend prominent display of both.

By the early 18th Century, secular threats of legal action supplanted curses. With the passage of the Statute of Anne in 1709, England's first copyright act, the regulation of unauthorized copying was went from god's exclusive jurisdiction to her Majesty's courts. In 1802 the U.S. Copyright Act, a direct descendant of the Statute of Anne, was amended to require a notice be placed on each copy of a work.

Like colophons, which listed special aspects of the book, such as the paper variety or type style used, copyright notices, generally appear on the title page, or reverse of the title page of printed books. The copyright symbol, the familiar © followed by the date and name of the owner (not necessarily the author), often comes with a nasty warning, not a curse. Here's a mildly threatening one:


ALL RIGHTS RESERVED. No part of this book may be reproduced in any form by any electronic or mechanical means (including photocopying, recording, or information storage and retrieval) without the prior written permission of the publisher.

Not too scary. Compare the polite "All Rights Reserved" legend found in close proximity to many copyright notices, with your average illuminated manuscript curse. If you were lent a manuscript and failed to return it, or made an unauthorized copy, you - and perhaps your forebears and children -- were forever cursed. In contrast, a copyright notice is a yellow blinking light at the corner of Purchase and Purloin Streets. Copyright notice or curse? No contest.

For 187 years, until the notice requirement was abandoned, in 1989, if a work was published without the proper form of notice, it was cast down into the public domain. Of course, a public domain work may still be covered by a protective curse. This is another advantage of a curse over a copyright notice - however, one that does not comport with the "securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries," mandate of the U.S. Constitution. [Emphasis added]

According to Drogin, the oldest known book curse appears on 
cuneiform tablets found in the biblical city of Ninevah. Like today's authors, Babylonian King Assur-bani-pal (668–626 BC) wasn't just concerned with protecting against theft, but receiving credit for his work. The French might equate it with “droit moral” – an author’s right to defend the integrity of their work and the use of their name. King Assur-bani-pal imprinted this form of notice on his royal records:

"Whosoever shall carry off this tablet or shall inscribe his name on it, side by side with mine own, may Ashur and Belit overthrow him in wrath and anger, and may they destroy his name and posterity in the land."
King Assur-bani-pal

The profound fear of being forgotten loomed as large in Babylonia then as in Hollywood today. Removing the name of a king from a cuneiform tablet meant he never existed. Much the same can be said for failing to credit a writer of a screenplay, whose livelihood (and footnote in history) depends on the works which bear their name.

Whether a curse or a copyright notice, these admonitions are powerful starts to the reading experience. Where does the power come from? Fear.

"May whoever destroys this title, or by gift or sale or loan or exchange or theft or by any other device knowingly alienates this book from the aforesaid Christ Church, incur in this life the malediction of Jesus Christ and of the most glorious Virgin His Mother, and of Blessed Thomas, Martyr. Should however it please Christ, who is patron of Christ Church, may his soul be saved in the Day of Judgment."

Before Johannes Gutenberg's invention of the printing press in the mid-1400s, books were precious objects worth fighting over. Coveted by the wealthy elite, stolen in a prior era by marauding Norsemen, literary monks went to great lengths to protect their collections of valuable manuscripts. Not only did they employ curses, but, they tethered their bibles to bookshelves and lecterns with chains.

As the fifteenth century became the sixteenth, book curses underwent a change, becoming more secular, foreshadowing the birth of copyright as a device to secure the sale of copies, and protect the livelihood of authors and publishers. German renaissance artist Albrecht Dürer invoked the wrath of the crown, not god, declaring in 1511:

Dürer's Engraving of  Erasmus

"Hold! You crafty ones, strangers to work, and pilferers of other men’s brains. Think not rashly to lay your thievish hands upon my works. Beware! Know you not that I have a grant from the most glorious Emperor Maximilian, that not one throughout the imperial dominion shall be allowed to print or sell fictitious imitations of these engravings? Listen! And bear in mind that if you do so, through spite or through covetousness, not only will your goods be confiscated, but your bodies also placed in mortal danger."

A copyright notice threatens economic harm, while the strategy behind the black art of the curse is to attack the infringer's mind. Dürer's transitional curse succeeds at both tasks.

Conclusion

How do you deter and/or retaliate against digital pirates who operate in total darkness? Tensions between copyright law and freedom of speech aside, curses offer an intriguing tenth century solution to this twenty first century dilemma. British law had a huge formative influence on U.S. copyright law. Maybe we need to take inspiration from Britain once more. Instead of a new Registrar of Copyright, a big shoe position which is currently vacant, perhaps, what we really need is a J.K. Rowland inspired Head of The Improper Use of Copyright Office, a subdivision of The Department of Magical Law Enforcement, in The Ministry of Magic (not the Library of Congress).


Copyright 2015 - 2017 Lloyd J. Jassin. All Rights Reserved.

Disclaimer / Curse: This article is protected by the Eye of Horus. If you infringe this article, may you be seized by the neck like a bird, your head cranked off, and your carcass hung up to drain*. Please note that this article is not designed to give any specific advice concerning any specific circumstances. Readers are strongly cautioned to consult an attorney before consulting a practitioner of the occult arts.

*Adapted from a curse on the tomb of the courtier Biw at Sakkara, circa 2260 B.C.






Lloyd J. Jassin is a publishing attorney, and head of his own private practice, where he concentrates on legal issues affecting authors, literary agents, publishers, and composers.  He began his career in book publishing, working for companies such as Prentice Hall / Simon &  Schuster and St. Martin's Press in publicity and marketing, which may explain his affinity for trademark law.  His the  coauthor of The Copyright Permission and Libel Handbook (John Wiley & Sons). 

Contact:   Law Offices of Lloyd J. Jassin, The Paramount Bldg., Floor 12, 1501 Broadway, NYC, 10036, (tel.) 212-354-4442; (Email), or visit: http://www.copylaw.org. Follow us on Twitter: http://twitter.com/LloydJassin

Resources


The 'Weird Tale' Behind the Malcolm Ferguson Book Plate 
The Story of St. Columba: A  Modern Copyright Battle in Sixth Century Ireland
Books in Chains by the Late William Blades (1892) (full text version)
Biblioclasm:  The Mythical Origin, Magic Powers & Perishability of the Written Word (Rowman & Littlefield) by Marc Drogan.
Books and their Makers in the Middle Ages  (Putnam) by Geo. A. Putnam
Questionable Utility of Copyright Notice: Statutory and Nonlegal Incentives in the Post-Berne Era by TP Arden - Loy. U. Chi. LJ. 1992





Threatening Bookplate via 'Confessions of a
Bookplate Junkie' Blog










Friday, July 29, 2016

The Art of the (Jointly Authored) Book Deal


"I can never understand how two men can write a book together; to me that's like three people getting together to have a baby."-- Evelyn Waugh

Nearly everyone has heard the oft-repeated statistic that 50% of all marriages end in divorce.  The odds are no better with creative partnerships than with romantic ones.  Pity the poor writer, expert, or public figure who enters into a creative partnership without thinking about the financial, emotional and practical challenges ahead of them.  If the relationship falters, a well-drafted collaboration agreement (written during the romance stage of the relationship) can be consulted.   

Good Contracts Make Good Writing Partners

Contracts define the parties' goals, their rights and remedies, and recognizes what could go wrong.  The key reasons collaborations fail are lack of commitment, lack of communication and unrealistic expectations.  And, the inability to deliver a final manuscript that is complete and satisfactory in the amount of time allotted.

The art of converting a deal into an effective agreement, requires you to address the following: (i) money (how much and when paid), (ii) business and creative decision-making authority, (iii) ownership, (iv) authorship credit, and (v) how to handle disputes.

How you choose to address these issues depends largely on your sense of fairness, your bargaining power, industry custom and practice, and, if you are represented by an attorney, their support and guidance in reaching a workable agreement.   And yes, sometimes it's not about the money, but what the book can do for you, your brand, or a cause that matters to you.  

The Law Presumes 50/50 Ownership

In the absence of a formal agreement, the way copyright law deals with authorship is black and white.  When two people blend their independently copyrightable contributions with the intent to write a book, or other creative work, each party is presumed to co-own the copyright.   That allows either party to publish the work without the other's permission.  If there is no written agreement, each co-author receives 50% of the profits. Judges do not apportion a larger or smaller share based on the collaborators' contributions, experience, reputation or seniority.   

Decision-making problems arise when there are multiple offers for the work or requests for exclusive rights and no written agreement exists between the parties.  If there is no written agreement, or the agreement fails to address the issue, an uncooperative co-author (or a deceased co-author's estate) can prevent the other party from licensing or selling book, film or other rights, as no publisher, or producer, will acquire rights on a non-exclusive basis.  If the book is a memoir, or an extension of one author's business or brand, then that party should be concerned about controlling business and creative decisions. Relinquishing control, or foregoing credit, however, does not necessarily mean the party giving up those rights receives a smaller financial interest.  Neither does it equate with lack accountability or transparency, provided those concerns are advanced by the party drafting - or negotiating - the agreement.

Ghost Written & "As Told To" Books 

If you are a ghostwriter of a memoir, or the writer of an "as told to" based on conversations with the subject, are you delivering a “warts and all” portrait?  Alternatively, is your role to put the best face on your subject’s story, without resorting to blatant deception?   You need to flesh this out.  In drafting the agreement, the subject's attorney will structure it so payment to the writer is tied to delivery and acceptance of the manuscript.   

Compensation is generally in the form of progress payments tied to satisfactory (and timely) delivery.  A portion of the writer's fee is paid on signing the ghostwriter or collaboration agreement.  A further payment will be due on delivery of an acceptable book proposal. If the book is is sold to a publisher, further payments will be tied to payments of the advance.  The greater you detail what is to be delivered, the less arbitrary the acceptance standards will be.

If you can't hold it together long enough to see the work published, the impact of a literary breakup can be devastating.  One such disaster scenario is the unilateral termination of "as told to" collaborations, such as the failed collaboration between Fay Vincent, the former commissioner of baseball, and writer David Kaplan, who worked without a contract, on the chance a publisher would acquire the book and pay them an advance.  The authors signed a deal with Little Brown, which promised to pay them an advance of $300,000, half of which was paid on signing, with balance due on delivery and acceptance of the complete manuscript.  After 90% of Vincent’s memoir was completed, Vincent withdrew the project from his publisher, which required him to repay the advance. However, he allowed Kaplan to keep his share of what had already been paid, or $60,000.  While Kaplan and Vincent had exchanged draft versions of a collaboration agreement before their relationship devolved into an intractable dispute, the issue before the court was whether Vincent could prevent Kaplan from publishing any of the work they created.  See, Kaplan v. Vincent, 937 F. Supp. 307 (SDNY 1996).  Because they were friends, Kaplan "did not believe a formal agreement was necessary."   If they had a formal agreement – as opposed to an oral understanding -- costly, time consuming and psychologically draining litigation would have been avoided.

The Elements of the Deal

Some of the deal points found in these agreements are quite simple and other are not.   Below are the major elements of a typical ghostwriter or collaboration agreement.  Whether you push and push, or settle for less, is between you and your attorney (or agent).  But, don't lose sight of  the fact a workable agreement, is often a reasonable agreement. 

Responsibilities. Be specific.  What must be delivered?  What is the date it must delivered by?  When you engage a writer to help you write a nonfiction book, generally, the writer will prepare a book proposal before completing the manuscript.  A book proposal is a detailed overview of the book, it contains the author’s credentials and information about how the book can be marketed, plus one or two sample chapters.  The proposal is the bait used to solicit interest from publishers. A nonfiction book proposal is usually written with the understanding that substantive work on the actual manuscript will not begin until there is an offer from a publisher. 

In some circumstances, where one party is more knowledgeable in publishing matters, it may be appropriate to grant that person the exclusive right to negotiate with agents and publishers. If you are not the one shopping the proposal, you will either reserve the right of final approval of the publishing contract, or predicate approval on receiving some minimally acceptable payment.  

Compensation.  If one of the parties has greater immediate financial needs -- whether money is needed to pay their rent or for travel-related research -- the other party can defer all or part their compensation from the initial advance.  As discussed above, it is customary for commercial publishers to advance a sum of future royalties to the authors when they sign a publishing agreement.  It's been likened to a pay day loan.  Once that money that has been recouped or refunded from future proceeds, the author who deferred can start getting paid, perhaps on more favorable terms than if they had not deferred payment.  Deferring payment is also a way for the subject of a book to obtain the services of a more experienced writer without having to go out of pocket for a large sum.  

Delivery dates in publishing are tied to publisher advances.   A missed deadline can result in cancellation of a book contract. That, in turn, can trigger an author's obligation to repay their advance.  Any agreement between collaborators should deal with the return of the portion of the advance paid to each collaborator.   

If the subject gets cold feet and pulls out (assuming both writer and subject are parties to a third party publishing agreement), stipulating in the collaboration agreement that the writer does not have to repay their portion of the advance will take some of the sting out of a failed collaboration. In other types of creative divorces, it may be possible to separate out each author's contribution, and transfer those rights to the original contributor. These strategies overlap, and are not at the exclusion of each other.

Keep in mind, even those who do not qualify as joint authors for copyright purposes (for example, individuals who made an important – but not copyrightable -- contribution to the manuscript) may still share in the profits and control of a work through an appropriate contractual arrangement.   

Credit. By some estimates, up to 70% of nonfiction books are ghostwritten. For example, it is widely believed that Theodore Sorenson wrote John F. Kennedy's Pulitzer Prize-winning book, "Profiles in Courage,” for which JFK took both the prize and sole author credit for. Clearly, a talented writer, who knows the ins and outs of publishing, can be a great asset in helping a public figure or an expert (but not an expert writer) go from idea, to book proposal to finished manuscript to published author. 

Writing credits take various forms.  The most common writing credits are: "by Subject and Writer" or "Subject with Writer" or "as told to Writer." By definition, if the book is ghostwritten, sole authorship credit for the work will be in the subject’s name only. In that case, the writer-for-hire must make peace with the fact the subject will receive sole authorship credit. Some might argue that ghostwriters should receive higher fees, because their names don’t appear on the finished book.   In the case of an equal in credit collaboration agreement, the size and prominence of names, as well as the order of names on the cover and title page, needs to be negotiated and agreed to in writing. 

Copyright.  A work for hire is a term defined by statute.  It can either be a work specially commissioned, or one created by a regular employee in the course of their employment. If you are the hiring party, it is especially important to clarify the nature of the writing services before you hire the person you wish to perform those services.  Later may be too late if your objective is to own all of the rights. After-the-fact attempts to classify a work as "for hire" often fail, which is why an effective contract includes a back-up copyright assignment.  

Death & Disability.  In the event of  either party's death, disability or an intractable disagreement, the agreement should have rules for hiring a new writing partner to complete the book. The agreement might specify that the authority to enter into contracts, and make creative decisions, vests solely in the subject's estate, or the writer (subject to a duty to account).  If a work is likely to be revised, the agreement should include a clause that allows the remaining author to revise the work and reduce the compensation paid to the other's heirs or representatives if it becomes necessary to hire an outside writer.  The agreement should also specify whether the person hired to complete the work is entitled to receive credit as an author.  

Control of Business & Editorial Matters. Control of business  affairs (e.g., who is responsible for seeking out and approving book deals?) and editorial matters (e.g., who has the authority to approve the final draft of the work or authorize revisions?) are critical issues. Unanimity may be required for certain decisions (e.g., approval of the initial publishing contract).  If one party retains approval rights over the manuscript, the other party should try to impose reasonable limitations, such as a chance to correct the manuscript within (e.g., 30) days after receipt of the other party’s comments.  Requiring the party with approval rights to provide detailed editorial reasons for any dissatisfaction, arguably, establishes objective criteria by which the writer can revise and have their contribution judged. 

Representations & Warranties.  From a ghostwriter, or "as told to" writer's perspective, the subject must provide representations (or promises) and warranties that they have or will: (i) provide access to pertinent documents, whether diaries or memorabilia, or business papers; (ii) provide reasonable access to themselves; (iii) use their best efforts to provide the writer with access to other individuals as may be required to write or finish the book; and (iv) cooperate in good faith with the writer in pursuing a publishing deal.  Special attention should also be paid to the indemnity clause.  An indemnity is a promise to reimburse the other party should they breach their warranties.  

Reciprocal representations and warranties are the norm as well.  They include: (i) no contractual commitments (e.g., a confidentiality agreement) exist that will interfere with the ability to perform their obligations; (ii) their contributions are original and will not violate any copyrights, proprietary rights, or rights of privacy, publicity, or constitute a libel against, or violate any other common law rights or other rights of any person or entity.  

If any liability arises because of a breach of either party's’ representations or warranties, the non-breaching party should be reimbursed for costs and expenses (including reasonable attorney's fees), and damages paid out to others.   If you are a "for hire" writer, meaning, the copyright vests in the party that hired you, the agreement should require the hiring party to make best efforts to have the publisher name you as an "additional insured" on the publisher's media liability policy.  If a writer is relying on material provided them by the person who hired them, they should exclude this material from their own representations and warranties.   
TIP.  Since verifiable truth is a complete defense to libel (at least in the United States), your agreement should require that both parties retain copies of all recorded interviews, transcripts, books, notes, letters, emails and other research materials used in preparation of the book. If there is a lawsuit, you may be required to prove the truth of the statements that are published. (see §9.12.1, The Copyright Permission and Libel Handbook (John Wiley & Sons).
Confidentiality & Non-Disparagement Clauses.

Confidentiality clauses are huge issues for celebrities and other public figures.  The downside of not dealing with confidentiality and non-disparagement issues is reputational harm.  Here's an example of the confidentiality clause from the unexecuted collaboration agreement between Fay Vincent and David Kaplan discussed above:  
All material whether oral or written contributed by either party for use in the manuscript, including materials and information provided prior to the execution hereof, shall be considered confidential, and neither party shall use any of such material or the facts or the information contained therein that have been provided with the parties' collaboration except as permitted hereunder or under an agreement with a third party to which both parties have previously agreed in writing, without the express prior written approval of the other party. In no event shall any confidential material otherwise be used by the party that has not furnished the same in the event there is any termination of the agreement. Specifically, Kaplan agrees not to participate in interviews, write any articles or books, or take any actions in or by which he discloses in any manner any of the unpublished information furnished to him hereunder, or any portion thereof, in connection with the work which is not publicly available or independently discovered by Kaplan, including any non-public aspect of the relationship of the parties involved in the preparation or the writing of the Work and/or its adaptation for use in any media whatsoever ....
An effective contract might also include a non-disparagement clause.   This is particularly important if you are a public figure, or represent a public figure.  
You agree that you will not (nor will you cause or cooperate with others to) publicly criticize, ridicule, disparage or defame Subject, his family, his business associates, company, directors, officers, shareholders, employees, agents, or attorneys, with or through any written or oral statement or image, whether or not they are made anonymously or through the use of a pseudonym. 
The subject's lawyer will also include a provision that requires the writer to agree to treat the ghostwriter agreement itself as confidential.   One common error is not to include exceptions, such as sharing the agreement with your agent, attorney, tax preparer, or as compelled by a court or  government agency (e.g., the IRS).  In terms of remedies for breach, in addition to injunctive relief (necessary because "A lie can travel halfway around the world while the truth is putting on its shoes." -- Charles Spurgeon), the ghostwriter might be required to forego royalties, or repay amounts previously paid, but any such remedy will be subject to scrutiny by the courts and a possible finding of unenforceability.  

Conclusion

The time to address these issues is before the actual creative process begins. Although collaborators might not feel comfortable discussing long-term financial and other issues, an effective agreement deals with these matters up front, rather than after the brickbats start flying.       

© 2013 - 2016.  Lloyd J. Jassin  


Disclaimer: This article, parts of which were previously published, discusses general legal issues of interest and is not designed to give any specific legal advice concerning any specific circumstances. It is important that professional legal advice be obtained before acting upon any of the advice contained in this article.


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