The Author Prenup: Advice for Collaborators


Double the Trouble or Half the Work?



Nearly everyone has heard the oft-repeated statistic that 50% of all marriages end in divorce. But what about creative partnerships?  The odds are no better. Pity the poor expert, celebrity, author, playwright or screenwriter 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.   If the relationship fails, that agreement will help for a clean break-up.
 
Like marriage, the key reasons most authors cite for failed collaborations are lack of commitment, lack of communication, unrealistic expectations, and lack of respect. While trust is an important element of any relationship, without a written agreement you are ill-equipped to deal with these and other conflicts.  Contracts define rights and remedies, and thus help avoid misunderstandings.
 

Tip: If avoiding conflict is not sufficient reason for having a written collaboration agreement, take note that many publishers contractually require – as a condition of working with the author team – that joint authors have a formal written agreement between them.

The Law Presumes 50/50 Ownership

The formation (and dissolution) of a creative partnership is governed by federal copyright law and state contract law. When authors blend their independently copyrightable contributions and talents with the intent to create a unitary work, each collaborator is presumed to co-own the copyright, and share equally in the money the copyright generates - whether profits or royalties. Further, under the default rules of the Copyright Act – which can be altered by a written agreement -- each collaborator can license the nonexclusive rights to the work to a third party, provided they fairly account for the profits to the other. 

Important! In the absence of an agreement, the way copyright law deals with authorship is black and white.  If there are two authors - and there is no written agreement - each 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 between collaborators commonly arise when there are multiple offers for the work or requests for exclusive rights and no agreement exists between the collaborators. If your collaboration is not working, and your agreement doesn't delegate the right to make business decisions to one of the partners, a recalcitrant collaborator can prevent the other collaborator from licensing or selling film or other rights in the work.  For this reason, you might consider changing the default rules of equal control and ownership, if the book is memoir, or an extension of one author's business or brand.  Relinquishing control, however, does not necessarily mean a smaller financial interest or lack of transparency.  

 Ghost Written & "As Told To" Books 
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.  After 90% of Vincent’s memoir was completed, Vincent withdrew the project from his publisher, and thwarted Kaplan’s efforts to publish the book under Kaplan’s own name. See, Kaplan v. Vincent, 937 F. Supp. 307 (SDNY 1996).  If the parties had a well-written agreement – as opposed to an oral understanding -- likely, costly , time consuming and psychologically draining litigation would have been avoided. 

If you are a writer who has been approached to help write a memoir, your agreement needs to address: (i) access to pertinent documents; (ii) reasonable access to the subject; and (iii) the subject’s good faith effort to secure the writer’s access to interviews with other individuals as may be needed to prepare the proposal or complete the book. From the subject's perspective, confidentiality is a key issue.  
If you are assisting with a memoir, are you delivering a “warts and all” portrait? Alternatively, is your role to put the best face on your subject’s life story, without resorting to blatant deception? A property drafted collaboration agreement will address these issues.  The greater you detail what is to be delivered, the less arbitrary the acceptance standards will be.  Since progress payments are the norm, if the subject is unhappy, you may not see anything beyond your initial payment or advance.  

A professional writer working on an “as told to” book may want to ask for a kill fee if the subject has the unilateral right to terminate the project.  It's funny how increasing someones financial commitment to a project, will increase their personal commitment as well.   If the subject gets cold feet and pulls out (assuming both writer and subject are parties to the Publishing Agreement), stipulating in the collaboration agreement that the writer does not have to repay her portion of the advance will also help 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.  

Special Issues 

Writing your own rules can give one of the parties more or less control or compensation than contemplated by the Copyright Act.  Doing so, is not in and of itself, unethical. Key drafting issues include (i) money (how much and when paid), (ii) decision making authority, (iii) copyright ownership, (iv) writing credits, (v) dissolution and withdrawal, and (vi) how to handle disputes.  This is where real world document drafting comes into play. For example, it is perfectly legal for a commissioning party to receive final approval over all aspects of the project, and for the scribe or writer to receive less than 50% of the profits otherwise dictated by the Copyright Act.

 Since collaboration and ghost writer agreements do not involve an equal division of work, there must be mutual respect and objectives. If you are not familiar with the intricacies of the publishing industry, or wish to insulate your creative or personal relationship from the business aspects of your literary partnership, look to your literary agent (if a disinterested party) for advice, or, preferably, engage a lawyer with an unbiased understanding of the publishing industry.  Make certain that attorney understands your goals. Is it more important to have a book that establishes you as an expert, than an additional 10% share of the royalties? Is equal credit more important than equal compensation?  Lawyers are often surprised to find out what their client’s real goals are. 

The Contractual Nitty Gritty

Below are some of the key issues to be found in a collaboration or ghost writer agreement. Of course, how collaborators split proceeds and make decisions, ultimately, depends on the writing partners’ sophistication, bargaining power and sense of fairness.  If you are using an off-the-shelf or generic collaboration agreement, or one provided by a helpful literary agent, consider having it reviewed by a publishing attorney to ensure what you intend, and what it says, lines up.  

Responsibilities. Try to be as specific as possible about what is to be delivered, and the time for delivery. When you engage someone to assist you with the writing of a nonfiction work, the writer will prepare the book proposal. A book proposal is a detailed overview of the book’s concept, and contains the author’s credentials and information about how the book can be marketed. The proposal is the bait used to solicit interest from publishers. The 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. This scenario is common with “as told to” books. 
In some circumstances, where one collaborator is far more knowledgeable in publishing matters, it may be appropriate to grant that person the exclusive right to negotiate with agents and publishers. Generally, the junior author will reserve the right of final approval, or predicate approval on receiving some set, or minimally acceptable payment, for initial publication rights to the book.  Deadlines in publishing are critical. Make certain the delivery schedule set forth in the publishing agreement is realistic. A missed deadline can result in cancellation of a book contract. That, in turn, can trigger the authors’ obligation to repay their advance. 

Compensation.  If one of the collaborators has greater immediate financial needs -- whether money is needed to pay his rent or to travel abroad to research the book -- the other party can defer all or part their compensation from the initial advance.  It is customary for larger publishers to advance a sum of future royalties to the authors when they sign a publishing agreement.  It's like a pay day loan.  Once that money that has been recouped or refunded from future proceeds,  the author who deferred can star getting paid, perhaps on more favorable terms than if he 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.  You can "sweeten" the deal, by offering the writer more money tomorrow in the form of a deferred bonus - assuming they are willing to bet on the success of the work.    

Often, the sharing of expenses is related to the sharing of receipts. For example, ghost writers and other writers-for-hire, usually get paid in installments – after portions of the manuscript are received and approved. However, a writer-for-hire who has been commissioned does not have to forgo royalties in exchange for a one-time fee. One way for a writer-for-hire to protect themselves is to take a smaller up-front fee, in exchange for a percentage of royalties. While conventional wisdom says most books don’t earn back their advance, by having a stake in the book – even a small one – an insurance policy is in place if the book becomes a surprise bestseller. 

 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 seventy percent of nonfiction books are ghost written. 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 an expert (but not expert writer) develops her unadorned idea into a book proposal or finished manuscript. For the avoidance of litigation, I recommend that the “subject” (and the writer) consult an attorney to preempt problems regarding ownership and credit. The order, size and prominence of the author credits depend largely on the bargaining power of the parties. The size and prominence of names, as well as order of names on the cover and title page, needs to be negotiated and agreed to in writing. If there is greater brand equity (or name recognition) in one collaborator’s name, it may make sense for that person's name to appear first. Where the issue is not clear-cut, alphabetical order is another sound approach. 
Assuming the intention to afford the writer credit, then the issue is in what form.  

Writing credits take various forms. Before taking a writing assignment, or hiring a writer, someone needs to initiate a discussion about credits.  The most common writing credits are: "by Celeb and Writer" or "by Celeb with Writer" or "as told to Writer." By definition, if the book is ghost written, 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 ghost writers should receive higher fees, because their names don’t appear on the finished book. 

Copyright. If you do not intend the work to be owned (and controlled) jointly, you must state that in the collaboration agreement.  The collaboration agreement must also contain a special work for hire clause, and, ideally, be signed prior to any work being done.  A work for hire is a work specially commissioned, or one created by a regular employee in the course of their employment.  In either instance the creator does not own the copyright, the client or employer does. 
Tip:  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.  
Death & Disability.  In the event of the death or disability of one of the collaborators, the agreement should set down rules for hiring a new writing  partner.  That will require a financial formula for splitting royalties and other revenue, and assessing the value of what the departing, or departed, author has contributed.  The agreement might specify that the authority to enter into contracts, and make creative decisions, vests solely in the remaining or surviving author (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 collaborator's heirs or representatives if it becomes necessary to hire an outside writer to keep the work up-to-date. When a collaborator dies, state law, or  the Copyright Act, will determine who steps into that deceased author's shoes. If an older work, the order of succession may be determined by the Copyright Act - not the deceased author's will.  For an article on the order of succession under the Copyright Act (which may trump the author's wishes as expressed in her will), read my article on copyright termination and estate planning at:  http://www.copylaw.org/2011/08/copyright-termination-is-author-right.html

Control of Business & Editorial Matters. Control of business (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?) critical or key issues. In cases where there are more than two authors, unanimity may be required for certain decisions (e.g., approval of the initial publishing contract). Other decisions may require a simple majority vote. Additionally, the parties may give approval rights over certain decisions (e.g., selection of a literary agent or publishing attorney) to one author, provided that person has superior knowledge and experience in such matters. Action Item! 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. One way to avoid disputes over what constitutes a satisfactory manuscript is to reference the approved book proposal. A typical provision may look like this:
Provided Subject has made herself available to Writer as set forth in Paragraph X, Writer shall deliver a complete Proposal, satisfactory to Subject in content and form, on or before __________. Subject shall have the right to approve the Proposal. Subject shall further have the right to promptly review and comment on draft sections of the manuscript from time to time to ensure that the Work substantially conforms to the approved Proposal, and for purposes of ensuring the accuracy of those facts contained therein. Subject shall have the right to approve the final text of the Work prior to the delivery date specified in the Publishing Agreement.
Requiring the subject to provide written reasons for any dissatisfaction of the manuscript establishes objective criteria by which the writer’s contribution will be judged. 

Representations & Warranties. Special attention should be paid to the warranties and indemnity clauses of your agreement.  Warranties are promises that the work does not infringe on anyone's copyright, defame anyone, violate anyone's right of privacy, or otherwise cause harm to anyone.  An indemnity is a promise to reimburse the other party if any of your warranties are false.  Warranties should be reciprocal. If any liability arises because of a breach of either parties’ representations or warranties, the non-breaching party should be reimbursed for costs and expenses (including reasonable attorney's fees), and damages paid 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.  Even if you are added, because the deductible portion of the publisher's media perils policy can be very high, you may want to investigate supplemental deductible insurance.  If you are relying on material provided you by the person who hired you, you should exclude this material from your representations and warranties.    
TIP.  Since verifiable truth is a complete defense to libel (at least in the United States), your collaboration agreement should also require that both parties retain copies of all recorded interviews, transcripts, books, notes, letters and other research materials used in preparation of the book. If there is a lawsuit, you will need to prove the truth of the statements that appear in your book (see §9.12.1, The Copyright Permission and Libel Handbook (John Wiley & Sons).
Miscellaneous.  The agreement should also address who bears the cost and responsibility of obtaining permissions to use other people's copyrighted material; the right to create prequels and sequels; multiple agents; ownership of any trademark or service mark rights that arise as a result of publication; the return of the advance if the book is sold to a publisher, but, ultimately rejected for non-delivery or delivery of an unsatisfactory manuscript; in the event of dissolution, separation of rights in the material contributed by each author; and dispute resolution.   If the intention is to self-publish, keep in mind that you are bound by the same rules that apply to bestselling authors and large scale commercial publishing ventures.

Conclusion

Is it double the trouble or half the work?  You decide. However, a collaboration agreement provides a chance for you – preferably, under the guidance of a qualified attorney – to fashion your own private body of law to govern your creative relationship. Ideally, the time to address the major issues confronting contributors and collaborators is before the actual creative process begins. Although collaborators might not feel comfortable discussing long-term financial and other issues, it is always easier and less expensive to deal with these matters up front, rather than after a dispute arises. 
© 2013 - 2015.  Lloyd J. Jassin  
 

Disclaimer: This article 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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