Don’t Sign Dumb Contracts

24 November 2011

Since news in the book world slows down over Thanksgiving and Mrs. PG informs PG that he needs a break, we’re going to reprise some of the most popular posts on this blog. Many went up when The Passive Voice had far fewer visitors than it does now.

PG will probably have some new posts during this long weekend, but Greatest Hits posts will also appear.

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.


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?”

Link to the 46 comments on the original post. Feel free to comment here if you like.

Agents, Big Publishing, Copyright/Intellectual Property, Kristine Kathryn Rusch

2 Comments to “Don’t Sign Dumb Contracts”

  1. PG, here’s wishing you and Mrs. PG a great Thanksgiving.

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