Book Contract Negotiation Checklist

Standardized book publishing contracts are powerful negotiation tools. They are not, however, chiseled in stone. Publishers regularly revise their contracts when asked to do so. The key is knowing what to ask for.    

To decode a publishing agreement, some authors turn to literary agents, 15% percent off partners for life in the journey from unbound to bound. Others retain flat or hourly fee publishing attorneys to help them navigate the maze of legal jargon and publishing industry argot. 

After the romance period ends and you read your contract, it will dawn upon you that you have signed your rights away for the life of the copyright. Typically, the publisher's exclusive rights last as long as the author's life, plus another 70 years.

Beware. Publishers' contracts are chock full of double dips and legal loopholes, and when it comes to royalties, a hall of mirrors where what it says and what it means are often two different things. While major publishers are not out to screw you, they will maximize their gains at your expense. Smaller publishers?  Some are saints, while others are predators.        

If chomping at the bit to sign a contract but cannot afford to hire a lawyer, visit Victoria Strauss' Writer Beware blog - a beacon of light in the "shadow-world of literary scams, schemes, and pitfalls." Writer Beware doesn't offer legal advice, but it does a stellar job exposing and raising awareness of questionable business practices in the literary world.   

Publishing Contract Checklist

  I.   The Basics

      1. In whose name is the contract? Author?  A legal entity?

      2. If a legal entity, you will be asked to sign an inducement letter; a form of 

          personal guarantee.  
      3. Description of work (synopsis)
          -Tentative title, # of words, # of photos, intended audience, fiction, non-                    fiction

II.   Grant of Rights and Territory

      1. Is it a license of certain rights or an assignment of all rights? 
      2. Term or time period (term or years or in perpetuity?)
      3. Geographic scope
           a)     World?
           b)     Limited?  (e.g., U.S., its possessions & Canada)
      4. Exclusive rights granted
           a)     Primary rights
                  -Hardcover
                  -Trade paperback

                  -Mass market
                  -eBook

          b)     Secondary (subsidiary rights)
                  -Periodical rights
                  1) First serial (i.e., pre-publication excerpts)
                  2) Second serial
                  -Book club
                  -Dramatic rights
                  -Film/TV rights
                  -Video Recordings / Audio Recordings

                  -eBook

                  -Other digital versions (apps, enhanced eBooks)
                  -Podcast / Radio rights
                  -Merchandising (commercial tie-in) rights
                  -Future technologies
                  -Foreign translations rights
                  -British Commonwealth rights

        c)    Rights Reserved by Author - Often omitted from contracts.  

III.   Manuscript Delivery

    1. Delivery requirements
          a) When due? Is the date realistic? Time is of the essence?
          b) What format? Specify the size of the paper, spacing, margins, etc.
          c) What to deliver?
                 -Number of manuscript copies disks (what WP format?)
                 -Index (who pays?)
                 -Number of illustrations, charts, photos (who pays?)
          d) Copyright permissions and releases
                 -Scope of rights (does it parallel grant of rights?)
                 -Who pays?
      2. Manuscript Acceptance
          a) Criteria: Satisfactory in "form and content" or at "sole discretion" of the  

            publisher? (Note: Historically, this clause has been a litigation flashpoint)
          b) Termination for unsatisfactory manuscript
          c) Termination for changed market conditions
          d) When must the publisher either accept or reject? 

          e) Good faith duty to edit
          f) Return of the author advance
                 -First proceeds clause
                 -False first proceeds clause

 

  IV. Copyright Ownership / Title

      1.  Who is responsible for registering the work with the Copyright Office?
      2.  Registration should be done within 3-months of publication.

      3.  Joint author or work-for-hire?
      4.  Reserved rights
            -Film, television, live stage = Author?

      5.  Copyright clearances/permissions

      6.  If a series, who owns the series title?
     

V. Author’s Representations & Warranties
      1. Author sole creator
      2. Not previously published; not in public domain
      3. Does not infringe any copyrights
      4. Does not invade right of privacy or publicity
      5. Not libelous or obscene
      6. No errors or omissions in any recipe, formula, or instructions
      7. Limited only to material delivered by Author

VI. Indemnity & Insurance Provisions
      1. Author indemnifies the publisher
      2. Does indemnity apply to claims and breaches?
      3. Can the publisher withhold legal expenses? Is it held in an interest   

      bearing account
      4. Is the author added as additional insured on the publisher's insurance?
      5. Does the publisher have the ability to settle claims without prior approval of         the author?  Author options. 

VII. Publication
      1. Duty to publish within [X] months of delivery & acceptance?
          a) Force majeure (acts of G-d)
                 - Any cap on delays?
      2. Advertising and promotion
      3. Right to use author's approved name and likeness
      4. Bound galleys/review copies
      5. Style or manner of publication
          a) Title consultation or approval?
          b) Book jacket
                 - Right of consultation? Approval?
          c) Changes in manuscript
      6. Initial publication by specific imprint or publisher may sublicense?

 

VIII. Advances & Royalties
      1. Advance against accumulated royalties
      2. When payable? (in halves, thirds, etc.)
      3. Royalties and subsidiary rights:
          a) Primary rights
                 -Hardcover royalties
                 -Trade paperback royalties
                 -Mass market royalties
                 -eBook royalties
                 -Royalty escalation(s)
                 -Bestseller bonus
                 -Royalty reductions
                  1) deep discount and special sales
                  2) mail-order sales
                  3) premium sales
                  4) small printing
                  5) slow-moving inventory

                  6) bundling with other works
          b) Secondary (subsidiary) rights royalty splits
                 -Book club (sales from publisher’s inventory v. licensing rights)
                 -Serialization (first serial, second serial)
                 -Anthologies, selection rights
                 -Large print editions
                 -Hardcover
                 -Trade paperback
                 -Mass market
                 -Foreign translation
                 -British Commonwealth
                 -Future technology rights
.                 -Audio rights
                 -Motion picture/TV/live stage
                 -Merchandising
                 -Advertising

     4. Reasonable reserve for returns
          a) What percentage is withheld?
          b) When liquidated?
      5. What is royalty based on? (Retail price? Wholesale price? net price?)
          a) At an average discount of 50%, 20% of net is the same as 10% of the list
          b) At an average discount of 40%, 16-2/3% of net is the same as 10% of the list
          c) At an average discount of 20%, 12-1/2% of net is the same as 10% of the list
       6. Recoupment of advance 

IX. Accounting Statements
      1. Annual, semiannual, or quarterly statements
      2. Payment dates
      3. Cross collateralize (good for publishers, bad for authors)
      4. Audit rights
      5. Limit on time to object to statements
      6. Limit on time to bring legal action
      7. Examination on a contingency basis
      8. Pass through clause for subsidiary rights income
      9. Reversion of rights for failure to account

X. Revised Editions
      1. Frequency
      2. By whom?
      3. Royalty reductions if done by the third party
      4. Sale of revised edition treated as a sale of a new book?
      5. Reviser/Author credit

XI. Option
      1. Definition of next work
      2. When does the option period start?
      3. Definiteness of terms (i.e., is option legally enforceable?)
      4. What type of option? (e.g., first look, matching, topping)

XII. Competing Works      

      1. How is competing work defined?      

      2. How long does non-compete run?
      3. Any reasonable accommodations?
      4. Special issues for fiction writers

XIII. Out-of-Print = Reversion of Rights
      1. How defined? (number of copies sold over __ accounting periods)
      2. Notice requirements
      3. Author's right to purchase digital files, inventory

XIV. Termination
      1. What triggers the reversion of rights?
          a) Failure to publish within (usually between 12 - 18) months of manuscript acceptance
          b) Failure to account to the author after due notice
          c) Failure to keep the book in print (see Section XIII)
      2. Survival of Author's representations and warranties
      3. Do licenses granted before termination survive
 
XII. Miscellaneous
      1. Choice of governing law
      2. Mediation / Arbitration?
      3. Bankruptcy
      4. Modification
      5. Literary agency clause
      6. Personal guarantee if the author is a business entity, not a human being.
      7. Reversion of unexploited rights (e.g., audiobook)
      8. Insertion of agency clause

Related Blog Posts

Libel in Fiction

Fair Use in a Nutshell 

Twelve Copyright Permission Myths  

Estate Planning for Authors 

 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)


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