Home » Agents, Big Publishing, Contracts, Kristine Kathryn Rusch » Don’t Sign Dumb Contracts

Don’t Sign Dumb Contracts

6 May 2011

Kristine Kathryn Rush is writing some important essays about the publishing world (“blog post” is too lightweight to adequately describe her analyses).

In her latest, Kris discusses contracts with publishers and agents, dirty tricks in some contracts and a worrisome trend of agents becoming more concerned with the interests of publishers than the welfare of the authors they represent.

Excerpts:

We used to recommend agents, but we slowly stopped doing that. Some of it was simple: we didn’t want to endorse any one we weren’t intimately familiar with. But it became more complex than that. Some of our agenting friends had left the business. Others had moved to companies that had rather unseemly business practices, and still others had morphed their agenting business into something unrecognizable.

Rather than walk through the thicket of ethics, friendships, business partnerships, and individual monetary policy, we just stopped recommending any particular agent. Over time, we stopped recommending agents at all.

During that same period of time, we saw a lot of publishing contracts that were…dicey…at best. We figured that because the contracts were for newer writers, the contract itself was a lower level of contract.

. . . .

I was noticing a few other things at the time, but not putting them together because my own career had hit a crisis point. My agent and I would negotiate a contract. Then we’d get the contract, and we’d have to remind the publisher that we had changed certain terms. The terms would get changed back.

Or we’d negotiate a contract, then sell a second book six months later on the same terms. Only when the contract arrived, it would be a completely different document. While the terms we had explicitly discussed would be the same as the ones we negotiated, the other terms, from the warranties to the deep discounts, would be extremely different.

. . . .

I was thinking of getting a new agent (yet again) and I asked him what his super-famous really big agency could do for me that a smaller agent couldn’t. Maybe because he’d had a few drinks, maybe because he is a very savvy man who has a finger on the pulse of publishing’s future, maybe because we were friends, he told me that he couldn’t do as much for his writers as he could have ten years before.

Clout counted for less and less in this business, he said. And since his business was all about clout, he was quite morose about it.

Then he told me stories about canceled contracts and misfired deals, stories like the ones I just told you, only these had happened to big name writers—writers with more clout than I ever had, more clout than that poor textbook writer could ever hope to have had. And the agent said he could do nothing about it.

Now, honestly, I’m not that shocked that publishers take advantage of writers. Writers and publishers enter into a business relationship, and business relationships can be adversarial. Personalities factor in, but so do the structure of companies. The smaller the company, the more likely it is to be on less solid ground financially, but the more likely it is to be a friendly place to work with.

Writers have always (usually?) been unarmed as they went into these business relationships with publishers. The writers would hire advocates to take care of them, to handle the adversarial part. Early on in my career, I hired an agent not just because I believed the agent knew more about publishing and publishing contracts than I did (and at the time, he did), but also to stand up for me when the time came, to fight for my needs and wants, to be my advocate.

Slowly, over time, agents stopped advocating for writers, and instead, started advocating for their agencies. Again, I noted the change, but believed it was only a few agencies, working on the Hollywood model. In fact, the agencies that pioneered this behavior came from Hollywood, and then branched into publishing as a side business.

I knew that many agents had forgotten who they worked for when the agent started refusing to mail books that “weren’t good enough” and refused to do things in their clients’ best interest because it “might hurt our other clients.” I always felt those were firing offenses, but a lot of writers put up with those things and more. And, it seemed, the behavior got worse, which I blamed mostly on the cutbacks in publishing. Those cutbacks forced a lot of laid-off editors into agenting, and editors didn’t know business nor did they know how to keep their hands off a perfectly fine manuscript.

But I was wrong.

I hadn’t realized until a few months ago that the adversarial relationship that sometimes existed between writer and publisher had moved into the agent/author relationship.

Link to the rest at Kristine Kathryn Rusch

Passive Guy has previously admitted to being a recovering lawyer (“I didn’t file a lawsuit yesterday. I didn’t file a lawsuit the day before yesterday. It has been 12 years, 153 days, 7 hours and 13 minutes since I filed a lawsuit.”).

While he does not practice law any more, he occasionally looks at publishing and other contracts for family members, friends he has known more than ten years, etc. (Please don’t send PG contracts to look at. It isn’t a recreational pastime.)

So, what basic publisher and agent contract advice does PG have for you?

1. Read the contract, every word of it. This isn’t like a credit card agreement that is regulated up one side and down another. There are no consumer protection laws for publisher’s and agent’s contracts. What is on the paper is what you give. What is on the paper is what you get.

2. Every contract is negotiable, so negotiate what you don’t like. “This is our standard contract” is the oldest scam in the world. Standard contracts are for banks who print them by the million. Publishers and agents may want “standard contracts,” but they probably also want world peace. You don’t have to accept their standard contracts. If a publisher or agent is interested enough in your book to want a contract with you, they’ll be willing to change some things. Negotiation is the process by which each side to a potential contract discovers how much they want the contract.

Authors are in a terrible psychic spot in negotiating their first contract with an agent or publisher. They sent out a million queries before they got an agent. Ten publishers turned down their manuscript before one became interested. Authors are inclined to think, “I’ll sign anything. Just don’t tell me no again.” Don’t get into that mode. Your old buddy, Passive Guy, will guarantee that you’ll be in a worse psychic spot if you and your manuscript are treated like trash under the terms of a bad contract. You must be ready to walk away from a bad deal.

3. Make certain every contract ends at some time. In recent publishing contracts PG has examined (and some that Kris describes in her essay), the contract goes on forever. So long as a product page exists for your book on some online bookstore, the contract continues. If the publisher decides your book should sell for $5,000 per copy in ebook form and you last received a royalty check for $2.93 ten years ago, under the terms of some “standard contracts,” the contract continues forever.

Don’t fall for a “life of the copyright” clause. In the United States, the copyright for your book ends 70 years after you die. When you are finally free of your agent, he won’t have returned a phone call for more than 70 years.

With both publishers and agents, PG recommends a “minimum wage for authors” – a dollar (or Euro, etc.) amount that the author receives every six months or year for a book. If the author doesn’t receive that amount, all rights to the book revert to the author, free of any publisher’s or agent’s claim.

An example of a minimum wage clause would be if an author doesn’t receive at least $5,000 in royalties in any year for her magnum opus, Dogs and Cats Can Get Along Just Fine, she can send a letter to the publisher and/or agent notifying them that she is retrieving her rights and they don’t have a piece of the book any more. The publisher has a year to sell out any hard copies in stock, but can’t print any more.

Don’t go for “out of print” provisions, particularly those that will require someone to count how many books are in warehouses. “Out of print” is meaningless for an ebook listing on Amazon.

This is a business relationship, not a tree-house club. If the publisher isn’t producing dollars for the author, it’s over. If the agent isn’t producing dollars for the author, it’s over.

4. Don’t give either the publisher or agent any option on your future work unless you’re writing a series. In that case, give them an option for the rest of the books in the series, but nothing else. If you write a sequel to Dogs and Cats, it’s reasonable to allow the publisher and agent to have rights to it, perhaps on the same terms as the first book or perhaps not. However, they don’t have rights to your manuscript for War and Peace and Zombies.

If you’re happy with the way things are going with the publisher and/or agent, you will almost certainly want to give them first shot at W&P&Z, but if you’re not happy, you should be free to pursue other options. Is your publisher guaranteeing it will publish your Zombie book or whatever else you write in the future? Is your agent guaranteeing the same thing? If not, you’re just asking that obligations and freedom from obligations be be the same for you as they are for them.

Watch out for “rights of first refusal” in their many guises. PG never saw a ROFR that he couldn’t break, but you don’t want to have to hire a lawyer and sue somebody just to find the right home for your Zombie series.

There are other things to watch out for in publishers and agents contracts, but PG has rambled for way too long.

One overriding principle to remember whenever you read a contract is to don’t assume that everything will go just fine. If the relationship with your publisher and agent is filled with bliss, nobody will ever look at the contract after it’s signed. The contract is for when something goes wrong.

Everybody loves one another when the contract is signed, but, as a student of human behavior, Passive Guy will assure you that love sometimes fades and dies. Love can even turn to hate. As a useful exercise, read your publisher/agent contract with this question in your mind: “How does this work if I hate my publisher and my agent has stopped speaking to me?”

Because all things change, also read your contract with this question in your mind: “How does this work if my publisher gets purchased by a Chinese steel company and my agent is fired and replaced with somebody who is six months out of Wellesley and believes anime is the next big thing?”

Agents, Big Publishing, Contracts, Kristine Kathryn Rusch

41 Comments to “Don’t Sign Dumb Contracts”

  1. Great post, Passive Guy. Thanks for sharing your expertise and Kristine’s blog.

  2. Excellent advice! Thank you, PG.

  3. Good advice. I especially like the idea of a minimum wage clause.

    • Elizabeth – A lot of authors receive royalty statements that announce small royalties on books that are overpriced by today’s ebook standards. These authors should have the opportunity to generate larger income themselves when their publishers are failing to do so.

  4. Excellent GP. Thanks.

  5. Wait, anime isn’t the next big thing?

    • Anime was the last next big thing. The current next big thing is probably something with zombies and Justin Bieber. It’s still developing.

      • Justin bieber as a zombie! What about slelf publihed books at places like create space? Its a print on demand thru amazon. I was looking into it but I didn’t see anything close to a contract.

        • There is a long contract, but basically CreateSpace is a printer and distributor, not a publisher. They don’t claim any rights to your book except the right to sell it at a price you set for as long as you permit them to do so.

  6. Like everybody else I love that minimum wage clause. It only makes sense. If they aren’t making money for you, you aren’t making money for them either. (And if they really want to keep the rights, they can pay you for it. Again and again.)

    • Part of the benefit of this type of clause is that they can pay the money if they really want to hold onto publishing rights.

  7. Bravo!

  8. Is there an option for RSS feed subscription coming soon? Please? :D

  9. Great post. Reading every word is critical. Back in my software developer days I used to get software specifications — which were often part of the contract by reference — that were horrors of ambiguity and vagueness. And some people were surprised when the company went out of business.

    Brilliant idea on the “minimum wage” reversion clause, saves all kinds of hassle trying to define what “out of print” means.

    • Alastair – Software specs and licenses are their own world of unreasonable contract provisions.

      Some OOP clauses I have seen are so ambiguous that I have argued the author has the option of declaring a publication out of print.

      • I found that all the software delivery penalty clauses droppped out when I said “Only if there is a matching incentive clause for early completion.” That usually stopped the interest cold.

        Glad you’re recovering – but please keep telling us what we’re doing wrong

        • Tom – See the first in a series of blog posts, “How to Read a Book Contract” that I just put up.

  10. I like that minimum wage clause, as well. I wonder how many publishers would actually go for it?

    • Sariah – Without disclosing confidences, I can tell you that I know of one publisher who accepted such a clause.

  11. […] received a boatload of traffic and Net love from yesterday’s post on some basics of contract negotiation. Thanks to all who contributed and a special thanks to […]

  12. Great, great, great, great, great, great!

  13. Excellent post, Passive Guy. I can’t remember the last time someone made me laugh out loud by writing about lawsuits and contracts. Maybe that’s because it’s never happened? Very good information–I’m passing this on to all my writer friends who are still looking at traditional publishing options!

    • Thanks so much, Amy. I’m happy to hear the the information is useful.

      As far as humor, lawsuits and contracts, a large gathering of lawyers is actually a pretty funny group. Attorneys are just the slightly grown-up kids in your elementary school who would never shut up in class. They all love to one-up each other, in court and in the humor arena as well.

      • Perhaps I went into the wrong business, then…

        I actually thought about law school, but I couldn’t get all the stories out of my head. Mostly I thought about law school because I like to argue. :)

        It was the 12-step count that really made me laugh. Funny to think of someone actually counting the days since he’s filed a lawsuit… :)

        • It’s a terrible thing to admit, but I really enjoyed going to court. Lots of adrenalin in court, a little like open-heart surgery while opposing counsel is bumping your elbow.

          Getting ready to go to court was something entirely different, however. Lots of drudgery.

  14. Thanks for the insightful essay. I have been reading Kathryn’s for a while and agree that she has some great information to share with writers. With all the changes gong on in the publishing world, it is great to find resources like this one and hers to help us through the minefield.

    • Thank you, Maryann. I agree that Kris is terrific and am honored that you and she found some useful information here.

  15. This is such an eye-opening post. My multi-published author friends all seem to be getting bullied by their agents. Now I understand why: “the adversarial relationship that sometimes existed between writer and publisher had moved into the agent/author relationship.” Wow. Things fall into place. No wonder big name authors are going indie. But I’m not sure there’s any hope for the rest of us.

    • Anne – A lot of people in Big Publishing are under significant financial stress these days. That sort of stress causes some people to do things they wouldn’t consider under other circumstances.

  16. […] Authors used to have publishers. Later, agents entered the industry and took pressure off editors by curating. They helped many authors get better deals. Now a lot of agents want to intermediate and perform more of an editorial function, possibly because other traditional roles they have fulfilled are shrinking. See this post for more on that and much more. […]

  17. As others have said, the idea of a minimum wage clause is a great one. Equally important, as you mentioned, is making sure the rights reverse back to you at some point: with e-books taking over larger portions of book sales, you don’t want to be stuck getting a smaller percentage of your e-book for years and years.

  18. […] of Reluctant Adults; – Why Opening With a Characteristic Moment Is So Important, no WordPlay – Don’t sign dumb contracts, no The Passive […]

  19. […] has no knowledge or relationship with this agency, but when he reads this post in connection with this one that discusses Kris Rusch’s warnings about agents and publishers, he feels a sense of unease. […]

  20. […] have previously discussed a minimum wage for authors contract provision here and here. It’s easy to focus on the dollar amount in such clauses and how they could […]

  21. […] – Don’t Sign Dumb Contracts | The Passive Voice. Posted on Tuesday, May 24th, 2011 to miscellania | Leave a Comment […]

Sorry, the comment form is closed at this time.