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Kris’s Post – Spread the Word

4 May 2012

I just received approval from Kris Rusch for everyone to spread the blog post that got hacked far and wide. Here’s a link where you can find it, although PG’s antivirus software says there are still problems in the code – http://kriswrites.livejournal.com/

If you want to be certain you have no malware issues, use the copy below. Please make sure you leave Kris’s copyright notice at the end of the post intact.

Beginning of post:

Welcome to one of my other websites. This one is for my mystery persona Paladin, from my Spade/Paladin short stories. She has a website in the stories, and I thought it would be cool to have the website online. It’s currently the least active of my sites, so I figured it was perfect for what I needed today.

Someone hacked my website. Ye Olde Website Guru and I are repairing the damage but it will take some time. The hacker timed the hack to coincide with the posting of my Business Rusch column. Since the hack happened 12 hours after I originally posted the column, I’m assuming that the hacker doesn’t like what I wrote, and is trying to shut me down. Aaaaah. Poor hacker. Can’t argue on logic, merits, or with words, so must use brute force to make his/her/its point. Poor thing.

Since someone didn’t want you to see this post, I figure I’d better get it up ASAP. Obviously there’s something here someone objects to–which makes it a bit more valuable than usual.

Here’s the post, which I am reloading from my word file, so that I don’t embed any malicious code here. I’m even leaving off the atrocious artwork (which we’re redesigning) just to make sure nothing got corrupted from there.

The post directs you to a few links from my website. Obviously, those are inactive at the moment. Sorry about that. I hope you get something out of this post.

I’m also shutting off comments here, just to prevent another short-term hack. Also, I don’t want to transfer them over. If you have comments, send them via e-mail and when the site comes back up, I’ll post them. Mark them “comment” in the header of the e-mail. Thanks!

The Business Rusch: Royalty Statement Update 2012

Kristine Kathryn Rusch

Over a year ago, I wrote a blog post about the fact that my e-book royalties from a couple of my traditional publishers looked wrong. Significantly wrong. After I posted that blog, dozens of writers contacted me with similar information. More disturbingly, some of these writers had evidence that their paper book royalties were also significantly wrong.

Writers contacted their writers’ organizations. Agents got the news. Everyone in the industry, it seemed, read those blogs, and many of the writers/agents/organizations vowed to do something. And some of them did.

I hoped to do an update within a few weeks after the initial post. I thought my update would come no later than summer of 2011.

I had no idea the update would take a year, and what I can tell you is—

Bupkis. Nada. Nothing. Zip. Zilch.

That doesn’t mean that nothing happened. I personally spoke to the heads of two different writers’ organizations who promised to look into this. I spoke to half a dozen attorneys active in the publishing field who were, as I mentioned in those posts, unsurprised. I spoke to a lot of agents, via e-mail and in person, and I spoke to even more writers.

The writers have kept me informed. It seems, from the information I’m still getting, that nothing has changed. The publishers that last year used a formula to calculate e-book royalties (rather than report actual sales) still use the formula to calculate e-book royalties this year.

I just got one such royalty statement in April from one of those companies and my e-book sales from them for six months were a laughable ten per novel. My worst selling e-books, with awful covers, have sold more than that. Significantly more.

To this day, writers continue to notify their writers’ organizations, and if those organizations are doing anything, no one has bothered to tell me. Not that they have to. I’m only a member of one writers’ organizations, and I know for fact that one is doing nothing.

But the heads of the organizations I spoke to haven’t kept me apprised. I see nothing in the industry news about writers’ organizations approaching/auditing/dealing with the problems with royalty statements. Sometimes these things take place behind the scenes, and I understand that. So, if your organization is taking action, please do let me know so that I can update the folks here.

The attorneys I spoke to are handling cases, but most of those cases are individual cases. An attorney represents a single writer with a complaint about royalties. Several of those cases got settled out of court. Others are still pending or are “in review.” I keep hearing noises about class actions, but so far, I haven’t seen any of them, nor has anyone notified me.

The agents disappointed me the most. Dean personally called an agent friend of ours whose agency handles two of the biggest stars in the writing firmament. That agent (having previously read my blog) promised the agency was aware of the problem and was “handling it.”

Two weeks later, I got an e-mail from a writer with that agency asking me if I knew about the new e-book addendum to all of her contracts that the agency had sent out. The agency had sent the addendum with a “sign immediately” letter. I hadn’t heard any of this. I asked to see the letter and the addendum.

This writer was disturbed that the addendum was generic. It had arrived on her desk—get this—without her name or the name of the book typed in. She was supposed to fill out the contract number, the book’s title, her name, and all that pertinent information.

I had her send me her original contracts, which she did. The addendum destroyed her excellent e-book rights in that contract, substituting better terms for the publisher. Said publisher handled both of that agency’s bright writing stars.

So I contacted other friends with that agency. They had all received the addendum. Most had just signed the addendum without comparing it to the original contract, trusting their agent who was (after all) supposed to protect them.

Wrong-o. The agency, it turned out, had made a deal with the publisher. The publisher would correct the royalties for the big names if agency sent out the addendum to every contract it had negotiated with that contract. The publisher and the agency both knew that not all writers would sign the addendum, but the publisher (and probably the agency) also knew that a good percentage of the writers would sign without reading it.

In other words, the publisher took the money it was originally paying to small fish and paid it to the big fish—with the small fish’s permission.

Yes, I’m furious about this, but not at the publisher. I’m mad at the authors who signed, but mostly, I’m mad at the agency that made this deal. This agency had a chance to make a good decision for all of its clients. Instead, it opted to make a good deal for only its big names.

Do I know for a fact that this is what happened? Yeah, I do. Can I prove it? No. Which is why I won’t tell you the name of the agency, nor the name of the bestsellers involved. (Who, I’m sure, have no idea what was done in their names.)

On a business level what the agency did makes sense. The agency pocketed millions in future commissions without costing itself a dime on the other side, since most of the writers who signed the addendum probably hadn’t earned out their advances, and probably never would.

On an ethical level it pisses me off. You’ll note that my language about agents has gotten harsher over the past year, and this single incident had something to do with it. Other incidents later added fuel to the fire, but they’re not relevant here. I’ll deal with them in a future post.

Yes, there are good agents in the world. Some work for unethical agencies. Some work for themselves. I still work with an agent who is also a lawyer, and is probably more ethical than I am.

But there are yahoos in the agenting business who make the slimy used car salesmen from 1970s films look like action heroes. But, as I said, that’s a future post.

I have a lot of information from writers, most of which is in private correspondence, none of which I can share, that leads me to believe that this particular agency isn’t the only one that used my blog on royalty statements to benefit their bestsellers and hurt their midlist writers. But again, I can’t prove it.

So I’m sad to report that nothing has changed from last year on the royalty statement front.


The reason I was so excited about the Department of Justice lawsuit against the five publishers wasn’t because of the anti-trust issues (which do exist on a variety of levels in publishing, in my opinion), but because the DOJ accountants will dig, and dig, and dig into the records of these traditional publishers, particularly one company named in the suit that’s got truly egregious business practices.

Those practices will change, if only because the DOJ’s forensic accountants will request information that the current accounting systems in most publishing houses do not track. The accounting system in all five of these houses will get overhauled, and brought into the 21st century, and that will benefit writers. It will be an accidental benefit, but it will occur.

The audits alone will unearth a lot of problems. I know that some writers were skeptical that the auditors would look for problems in the royalty statements, but all that shows is a lack of understanding of how forensic accounting works. In the weeks since the DOJ suit, I’ve contacted several accountants, including two forensic accountants, and they all agree that every pebble, every grain of sand, will be inspected because the best way to hide funds in an accounting audit is to move them to a part of the accounting system not being audited.

So when an organization like the DOJ audits, they get a blanket warrant to look at all of the accounting, not just the files in question. Yes, that’s a massive task. Yes, it will take years. But the change is gonna come.

From the outside.

Those of you in Europe might be seeing some of that change as well, since similar lawsuits are going on in Europe.

I do know that several writers from European countries, New Zealand, and Australia have written to me about similar problems in their royalty statements. The unifying factor in those statements is the companies involved. Again, you’d recognize the names because they’ve been in the news lately…dealing with lawsuits.

Ironically for me, those two blog posts benefitted me greatly. I had been struggling to get my rights back from one publisher (who is the biggest problem publisher), and the week I posted the blog, I got contacted by my former editor there, who told me that my rights would come back to me ASAP. Because, the former editor told me (as a friend), things had changed since Thursday (the day I post my blog), and I would get everything I needed.

In other words, let’s get the troublemaker out of the house now. Fine with me.

Later, I discovered some problems with a former agency. I pointed out the problems in a letter, and those problems got solved immediately. I have several friends who’ve been dealing with similar things from that agency, and they can’t even get a return e-mail. I know that the quick response I got is because of this blog.

I also know that many writers used the blog posts from last year to negotiate more accountability from their publishers for future royalties. That’s a real plus. Whether or not it happens is another matter because I noted something else in this round of royalty statements.

Actually, that’s not fair. My agent caught it first. I need to give credit where credit is due, and since so many folks believe I bash agents, let me say again that my current agent is quite good, quite sharp, and quite ethical.

My agent noticed that the royalty statements from one of my publishers were basket accounted on the statement itself. Which is odd, considering there is no clause in any of the contracts I have with that company that allows for basket accounting.

For those of you who are unfamiliar with basket accounting, this is what it means:

A writer signs a contract with Publisher A for three books. The contract is a three-book contract. One contract, three books. Got that?

Okay, a contract with a basket-accounting clause allows the publisher to put all three books in the same accounting “basket” as if the books are one entity. So let’s say that book one does poorly, book two does better, and book three blows out of the water.

If book three earns royalties, those royalties go toward paying off the advances on books one and two.

Like this:

Advance for book one: $10,000

Advance for book two: $10,000

Advance for book three: $10,000

Book one only earned back $5,000 toward its advance. Book two only earned $6,000 toward its advance.

Book three earned $12,000—paying off its advance, with a $2,000 profit.

In a standard contract without basket accounting, the writer would have received the $2,000 as a royalty payment.

But with basket accounting, the writer receives nothing. That accounting looks like this:

Advance on contract 1: $30,000

Earnings on contract 1: $23,000

Amount still owed before the advance earns out: $7,000

Instead of getting $2,000, the writer looks at the contract and realizes she still has $7,000 before earning out.

Without basket accounting, she would have to earn $5,000 to earn out Book 1, and $4,000 to earn out Book 2, but Book 3 would be paying her cold hard cash.

Got the difference?

Now, let’s go back to my royalty statement. It covered three books. All three books had three different one-book contracts, signed years apart. You can’t have basket accounting without a basket (or more than one book), but I checked to see if sneaky lawyers had inserted a clause that I missed which allowed the publisher to basket account any books with that publisher that the publisher chose.


I got a royalty statement with all of my advances basket accounted because…well, because. The royalty statement doesn’t follow the contract(s) at all.

Accounting error? No. These books had be added separately. Accounting program error (meaning once my name was added, did the program automatically basket account)? Maybe.

But I’ve suspected for nearly three years now that this company (not one of the big traditional publishers, but a smaller [still large] company) has been having serious financial problems. The company has played all kinds of games with my checks, with payments, with fulfilling promises that cost money.

This is just another one of those problems.

My agent caught it because he reads royalty statements. He mentioned it when he forwarded the statements. I would have caught it as well because I read royalty statements. Every single one. And I compare them to the previous statement. And often, I compare them to the contract.

Is this “error” a function of the modern publishing environment? No, not like e-book royalties, which we’ll get back to in a moment. I’m sure publishers have played this kind of trick since time immemorial. Royalty statements are fascinating for what they don’t say rather than for what they say.

For example, on this particular (messed up) royalty statement, e-books are listed as one item, without any identification. The e-books should be listed separately (according to ISBN) because Amazon has its own edition, as does Apple, as does B&N. Just like publishers must track the hardcover, trade paper, and mass market editions under different ISBNs, they should track e-books the same way.

The publisher that made the “error” with my books had no identifying number, and only one line for e-books. Does that mean that this figure included all e-books, from the Amazon edition to the B&N edition to the Apple edition? Or is this publisher, which has trouble getting its books on various sites (go figure), is only tracking Amazon? From the numbers, it would seem so. Because the numbers are somewhat lower than books in the same series that I have on Amazon, but nowhere near the numbers of the books in the same series if you add in Apple and B&N.

I can’t track this because the royalty statement has given me no way to track it. I would have to run an audit on the company. I’m not sure I want to do that because it would take my time, and I’m moving forward.

That’s the dilemma for writers. Do we take on our publishers individually? Because—for the most part—our agents aren’t doing it. The big agencies, the ones who actually have the clout and the numbers to defend their clients, are doing what they can for their big clients and leaving the rest in the dust.

Writers’ organizations seem to be silent on this. And honestly, it’s tough for an organization to take on a massive audit. It’s tough financially and it’s tough politically. I know one writer who headed a writer’s organization a few decades ago. She spearheaded an audit of major publishers, and it cost her her writing career. Not many heads of organizations have the stomach for that.

As for intellectual property attorneys (or any attorney for that matter), very few handle class actions. Most handle cases individually for individual clients. I know of several writers who’ve gone to attorneys and have gotten settlements from publishers. The problem here is that these settlements only benefit one writer, who often must sign a confidentiality agreement so he can’t even talk about what benefit he got from that agreement.

One company that I know of has revamped its royalty statements. They appear to be clearer. The original novel that I have with that company isn’t selling real well as an e-book, and that makes complete sense since the e-book costs damn near $20. (Ridiculous.) The other books that I have with that company, collaborations and tie-ins, seem to be accurately reported, although I have no way to know. I do appreciate that this company has now separated out every single e-book venue into its own category (B&N, Amazon, Apple) via ISBN, and I can actually see the sales breakdown.

So that’s a positive (I think). Some of the smaller companies have accurate statements as well—or at least, statements that match or improve upon the sales figures I’m seeing on indie projects.

This is all a long answer to a very simple question: What’s happened on the royalty statement front in the past year?

A lot less than I had hoped.

So here’s what you traditionally published writers can do. Track your royalty statements. Compare them to your contracts. Make sure the companies are reporting what they should be reporting.

If you’re combining indie and traditional, like I am, make sure the numbers are in the same ballpark. Make sure your traditional Amazon numbers are around the same numbers you get for your indie titles. If they aren’t, look at one thing first: Price. I expect sales to be much lower on that ridiculous $20 e-book. If your e-books through your traditional publisher are $15 or more, then sales will be down. If the e-books from your traditional publisher are priced around $10 or less, then they should be somewhat close in sales to your indie titles. (Or, if traditional publishers are doing the promotion they claim to do, the sales should be better.)

What to do if they’re not close at all? I have no idea. I still think there’s a benefit to contacting your writers’ organizations. Maybe if the organization keeps getting reports of badly done royalty statements, someone will take action.

If you want to hire an attorney or an auditor, remember doing that will cost both time and money. If you’re a bestseller, you might want to consider it. If you’re a midlist writer, it’s probably not worth the time and effort you’ll put in.

But do yourself a favor. Read those royalty statements. If you think they’re bad, then don’t sign a new contract with that publisher. Go somewhere else with your next book.

I wish I could give you better advice. I wish the big agencies actually tried to use their clout for good instead of their own personal profits. I wish the writers’ organizations had done something.

As usual, it’s up to individual writers.

Don’t let anyone screw you. You might not be able to fight the bad accounting on past books, but make sure you don’t allow it to happen on future books.

That means that you negotiate good contracts, you make sure your royalty statements match those contracts, and you don’t sign with a company that puts out royalty statements that don’t reflect your book deal.

I’m quite happy that I walked away from the publisher I mentioned above years ago. I did so because I didn’t like the treatment I got from the financial and production side. The editor was—as editors often are—great. Everything else at the company sucked.

The royalty statement was just confirmation of a good decision for me.

I hope you make good decisions going forward.

Remember: read your royalty statements.

Good luck.

I need to thank everyone who commented, e-mailed, donated, and called because of last week’s post. When I wrote it, all I meant to do was discuss how we all go through tough times and how we, as writers, need to recognize when we’ve hit a wall. It seems I hit a nerve. I forget sometimes that most writers work in a complete vacuum, with no writer friends, no one except family, who much as they care, don’t always understand.

So if you haven’t read last week’s post, take a peek [link]. More importantly, look at the comments for great advice and some wonderful sharing. I appreciate them—and how much they expanded, added, and improved what I had to say. Thanks for that, everyone.

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“The Business Rusch: “Royalty Statement Update 2012,” copyright © 2012 by Kristine Kathryn Rusch.

Kristine Kathryn Rusch

47 Comments to “Kris’s Post – Spread the Word”

  1. Wow. Just… wow. I can’t imagine putting up with half of what Kris talks about in this post. “Basket accounting”? I told that to my CPA friend and he laughed for a good five minutes.

    And don’t even get me started on royalty statements.

    I spent a week last month devoted to nothing other than trying to make GGP’s royalty statements as clear and at the same time as detailed as possible without inundating authors. I succeeded, according to my authors who received royalties.

    I simply can’t conceive of doing business in a way that doesn’t track actual sales, but relies on a formula.

    SO glad I never went the trad pub route. So, SO glad.

  2. Thanks PG! I already did it this morning:

    I sent Kris an email to let her know that I was blogging about it and she sent me a message back thanking me. I also pointed her to your blog to let her know where I found out about it.

    Thanks PG for staying on top of things! Your blog is the best!

  3. I’m not cool enough to know Mrs. Dean Wesley Smith personally 🙂 But it’s up on eawestwriting.blogspot.com, with a bit of background and encouraging people to repost it.


    Go ahead, let them hack Google. (I didn’t put it on my wordpress because I haven’t updated that in awhile)

    also, blog owners might want to go ahead an EXPORT a copy of their blog just in case this is a targeted attack of some kind (even if it’s just robotic…)

  4. Posted on my blog, to help with the effort: http://jamarlow.com/2012/05/spread-the-word-kris-rusch-royalty-statements-pt/

    The more the better on this.

    I concur on the backup. Best to protect your blog, just in case. Also, make sure you have good passwords set up. Better safe than sorry.

  5. Just posted Ms. Rusch’s blog post on my site as well.


  6. Had already planned on doing this. Did a “nuke cleanup” on the original (copy and pasting into a text editor) and posted here: http://lrcutter.livejournal.com/171318.html

    Best of luck to Kris through all of this.

  7. After backing up my site and password stuff, I have hosted it: http://neciaphoenix.com/?p=541

    **pops up popcorn**

    Lets see where this goes.

  8. Thanks PG. I shared Kris’ post on my blog/website too. This is pretty crazy. Glad everybody’s jumping on board to help Kris out.

  9. Kristine Kathryn Rusch

    Thank you, everyone, for rallying behind me and the post. It looks like, after 36 hours of examination, that this is a standard malware attracted by the huge Thursday traffic on my blog. The malware is quite malicious, and is eating my other websites linked to the original one, marching through them like Sherman’s March to the Sea, leaving only devastation in its wake.

    I have had several people working on this. I’ve finally hired a national service to solve it. If the service does a good job, I’ll let everyone know.

    I couldn’t quite figure out why the trolls had moved from embedding worms and doing things to my website that annoyed only *me,* to doing something like this. (And yes, I kept upgrading my security, but not enough, I guess.) But I have had a lot of troll attacks, most of which they claimed credit for, but they didn’t claim credit for this one. So…the Russian malware theory that folks are citing here and in an earlier post is probably the right one.

    Which is not to say there haven’t been a series of malicious trolls on my site of late, which is why I jumped to the paranoid conclusion….

    Anyway, thank you all for the support and the repostings. This is a post that does need to be out there for all the writers in traditional publishers to see. Whether the spread of the post is malware-caused by some anonymous Russian hacker or troll-caused, it doesn’t matter any more. What matters is the great support from you all and the Passive Guy here (thank you, thank you) and the fact that folks now know to check their royalty statements–again.

    Thank you!


    • Hi Kris, Thanks to Chicki Brown posting a link on FB, I read your scathing post. Marvelous. More. More. Below is a letter I sent to the Authors Guild a couple of months ago. Joe Konrath, whom I am sure you are a fan of, published it on his blog “A Newbies Guide to Publishing”. It might amuse you. I am 70 years old and have been being ripped off by publishers since 1975. Basket accounting? I confronted it in 1976 in NYC. They ate the advance on a second book that they had ordered because the decided not to publish it after all. I never got my money back. Changed publishers many times. Agents more often. Anyway… here’s the letter to Authors Guild. If you can spare a minute from your busy writer’s life, have a read.

      JOE KONRATH says: To wrap this up, this is an email that author Suzanne White sent to the Authors Guild after their last bit of nonsense chastising Amazon. Suzanne also sent it to me, and I asked if I could post it here.

      Suzanne: It’s unfortunate that an entity which professes to be an “Authors Guild” doesn’t work for authors. It works instead for the publishing industry. It works to try to protect what is obsolete.

      Authors today can go to Amazon with books they have written, post them on Kindle or develop paperbacks with Createspace or seek to actually be published by Amazon… and get a 70% royalty on their sales. Do you encourage them? Do you help them to understand how they can gain their freedom? Do you applaud those courageous authors who self publish, sell on Kindle and make a living? No you do not. Instead, you warble on, lamenting the fact Bezos is taking over the crusty publishing industry. DUH!


      Where in the traditional publishing industry can an author command 70%? Where can an author have utter dominion over cover art? Formatting? Content? Illustrations? Impact? Marketing? The answer is Amazon. And a little bit Pubit and sometimes Smashwords or Apple as well. Where in the standard publishing industry can an author revive a book that he or she wrote in 1982, sold to a publisher who printed it, didn’t sell very many and took it right off the market? Amazon, that’s where. Author gets rights back, re-formats the book, slams it up for sale on Kindle and in six months is making money with that book.

      Where? Tell me. Where can an author do better?

      Why does a Guild for Authors rail on about monopolies and decry the demise of old-fashioned publishing as we knew it? Dinosaurs still prowling the streets of Manhattan want their good old boy industry back. Give it up already.

      I have been an author for 37 years. I have had agents and publishers up to here. Most authors are, like myself, fed up with the good old boys. Publishers pay gigantic overhead for prime real estate offices and switchboards and secretaries and senior editors and junior editors and cafeterias and fancy seduction lunches for unsuspecting newbie authors and deign give 10 lousy % to an author? Agents? They don’t work for authors either. They flog your book, take their % and when you get into a dispute with a publisher, agents crawl under the couch.

      Is our Authors Guild really just an arm of the Publishers Guild? We authors who want to retain digital rights so we can sell our books directly are discouraged from even trying. “Don’t self-publish. You might explode.” You warn. “Get an industry standard, agency acceptable royalty.”

      You guys! Help authors reach their potential. Stop going to bat for the big guys. It’s over boys. Move on out. Don’t blame Bezos. Blame history. Ebooks are the future. Young people today grew up on screens. They don’t know any other way. Can you really imagine you might convince the young to return to paper? It’s Farenheit 451 in reverse. We are burning the books — not because they contain information deleterious to society, but because they are unwieldy and wasteful. Yes, you can spill coffee on a paper book and it won’t lose battery power. But if I pour my coffee on my Kindle and it seizes up, I call Amazon and they tell me how to restore it to its spiffy old self and they return all my books to me presto because they have stored them for me on their computers. I cannot take my coffee-stained copy of War and Peace back to the bookstore and ask for it to be replaced. No way.

      I, for one, am content to have rigorously retained all my electronic rights. From the beginning in 1975. Thanks to digital rights, I now make a living from my books – which is more than I can say for all the years I was indentured to Simon and Shoestring.

      Ciao Publishers. Ciao Agents. Ciao slavery.

      Suzanne White

  10. I reposted Ms. Rusch’s article on my LJ, and with the help of a commenter, discovered what seems to be the vector for the attacks: an image file embedded in the HTML. The link goes back to Ms. Rusch’s original website and server, kriswrites.com, so that wherever you go (if the text was reposted with all the HTML and formatting intact) you get linked back to the corrupted image file. So it really does appear to be a single attack on her site and not on any others — at least so far.

    I don’t have Ms. Rusch’s contact information and can’t get it except through the non-functioning portions of her own site. If anyone can let her know about this, I’d appreciate it, and I have a hunch that she might, too.

    By the way, my copy of the post is here: http://superversive.livejournal.com/117147.html

  11. Go go indie movement!

  12. Kristine Kathryn Rusch

    Thank you, Tom. Much appreciated!

    • You’re welcome! I hope the information helps you get your site disinfected soon. Meanwhile — a worse pox on whoever did it!

  13. Kris’s post is now up on http://www.wildwickedwacky.blogspot.com

  14. I put the whole post up on my blog, too. Even if this wasn’t a targeted attack, it’s an important subject and people need to know about it.

  15. Just one suggestion – don’t browse the web without the Noscript extension installed (Firefox). It takes a while to white-list your regular sites, but after that these nasties don’t have a chance.

  16. Kris’ post is also up on my blog …


    Hope you get things sorted out fast.
    & thanks PG.

  17. So what do people think about the issues in the post? I think the agency mentioned really did the dirty on their writers and are setting a bad standard (again). I’m also shocked by the ballsyness of the publishers. Maybe Kris-Dean-PG and other experienced players might be able to chime in.

    • Maybe PG can elide it and repost as usual, with an eye to discussing the content and not the context? Because wow.

      I hope the government audits the shit out of them all. It’s my understanding that when the DOJ audits you they aren’t limited to what the search-warrant specifies like a normal investigation? But perhaps that is incorrect. I have no doubt there will be shenanigans aplenty discovered in their books. The only questions are whether that information will be made public and whether the DOJ will take action based on what they find.

      PG, do you know if DOJ audits would be subject to FOIA requests? Not that any of that would be available probably until they’re done investigating, which, you know, years away and all. Still. I’m curious if the public would be able to get that information out by knowing it’s there and requesting it even if the investigators don’t think it merits action or publication.

      • Lily – This is not a search warrant issue because the DOJ has filed a civil suit. This is discovery in connection with a lawsuit, which can be quite broad.

        I’m not an expert on FOIA, but I suspect that any documents/information involved in pending litigation are not subject to FOIA requests.

        • Thanks for clarifying that a DOJ investigation does not need a warrant and is therefore not limited by one. What I suspected but I am not any kind of legal expert.

          Regarding the FOIA, absolutely it would not be availble until the lawsuit is settled, but what about after? Or would that information be walled off behind confidentiality agreements (are those even possible in government-filed lawsuits)?

          • The DOJ isn’t special in that respect, Lily. If they’re accusing someone of criminal activity, they have to go through the entire process including warrants, indictments, and the whole bit, same as the City Prosecutor of East Whiffle, SD.

            This is discovery in a civil trial. “Discovery” was invented to reduce or eliminate surprises in a trial; it requires that both sides reveal to the other anything and everything that might be material to the dispute, so the trial itself almost becomes a formality. That can, as PG says, get quite broad even between two private litigants, and the DOJ is special there. They are empowered (or have empowered themselves) to investigate the defendant they’re suing, looking for things that might be material and deciding which is which, and they aren’t exactly scrupulous about keeping secrets when they discover something alarming but decide it isn’t material to the case itself — and they reserve the right to add stuff to the civil complaint, or generate new complaints, if they find something they don’t like.

  18. The ‘bucket accounting’ situation also sounds like a nightmare. Has anyone else had this problem recently?

  19. I posted it on mine as well. (And thought I had said so here but I guess I didn’t as I can’t find my post.)

  20. Posted on my site as well:


    Also, I know Kristine allows readers to donate through PayPal in support of her Thursday column and was wondering if that’s still active. I wouldn’t mind making a donation to help her get her website cleaned up.

  21. Also posted here on my LiveJournal:


  22. Kris,
    Thanks for informing us about basket accounting, which isn’t a new practice. I’ve found the Authors Guild is very good about taking action. I’d contact them about your experience.
    As for royalty statements, you need to check them, whether or not you have an agent. Years ago, I caught a whopping big error on the very first royalty statement I’d ever received.

  23. Thanks for posting Kris’ article PG. I’ve tweeted the link. 🙂

  24. I know personally of authors whose multi-book deals have been subjected to basket accounting. In each of these instances, the accounting/payment method was spelled out in the contract. From what I saw in Kris’s original post, these contracts were not agreed to be paid in this way. Doesn’t that in itself constitute breach? One party to a contract can’t unilaterally change it.

    • Yeah, but one party might if they assume that the other party doesn’t have the lawyers, money, and know-how to squawk about it….

    • It seems like these publishers are counting on the other party’s inability to fight back except by pulling their books and going unpublished. Anyone but a bestselling author who tries to fight is likely to end up on a blacklist, I suspect.

      Now that self-publishing is a viable option, that implicit threat has lost its force. But publishers don’t seem to know that yet, and unfortunately, neither do a lot of writers.

  25. PG, is it not the responsibility of an ISP hosting a web site to protect the customer from this sort of vandalism? If I rent space in a garage to park my car, is the garage owner not responsible for damages from vandals and/or thieves? Does Kris’ ISP not have a legal responsibility to protect her website by installing and maintaining security software? This would seem to be a question all writers (and ISP customers) might find vital.

    Thanks, and thanks for supporting Kris this way.

    • An ISP’s terms and conditions typically disclaim liability for this sort of thing.

      An ISP typically does not regulate what customers put up on the space they rent on the server so long as it’s not illegal. People can upload all sorts of websites/blogs/commercial software/custom programs that have a zillion security holes and use “1234” as their password. A big ISP will have hundreds or thousands of customers doing things all the time.

      Some ISPs run security software that searches for and removes known problems, but such software can’t protect against everything.

      Because users of various degrees of technical sophistication are running websites and blogs, the analogy for an ISP is not so much a garage owner as it is a company that rents automobiles to anyone with a drivers license.

      • Sure, an ISP can post any disclaimer it wants. But the terms of any disclaimer are only good if a court recognizes them, no? If I rent a car from a rental company and sign a liability waiver, does that still let the rental company off the hook if their poorly maintained car suffers a mechanical malfunction that injures me? I’m just curious how far a service provider of any kind can back away from any responsibility to customers, before the law kicks in and says otherwise.

  26. Kristine Kathryn Rusch

    It looks like the security service has triumphed. The website is back. I haven’t yet received a report from the service to let me know if the attack was intentional–and we may never know. But I wanted to say thank you to everyone who commented, helped, donated, mirrored the post, and just sent support. It means a lot. I really appreciate PG’s willingness to use his site to help spread the message about the attack and, more importantly, the royalties post. Thank you!

    I put a longer thank you post on the site this morning. You guys rock.

    • Hooray for the triumph of the Electronic Good Guys!

    • Ya know, I’m still getting a message that the site is still an “Attack Site” (my virus software’s term).

      Is it safe to ignore that warning?

      • Should be ok, it takes time to get such warnings removed. – Also remember that it takes time to put them into place. They are an indicator but not too reliable, esp. if the hack was more sophisticated than here.

  27. The terms “agent” and “agency” have legally defined responsibilities towards clients. It sounds like the fox is guarding the hen house. At a minimum, the agent owes each of its clients action that does no harm to that individual client. I guess 15 percent is no longer the going rate for ethical behavior.

  28. Between Kris and Joe – I can’t see any reason to sign with Trade Publishing. It just isn’t worth it.

    It’s like lineing up to be fleeced by a con man.

    Glad to see Kris has her site back.

  29. Kristine Kathryn Rusch

    Rob and everyone, it is now safe to ignore the warning. I had two services scour the site, and a couple of web people make sure the services did a good job. Now we just have to wait for the warning to come down. So it’s okay to click through. Thanks for asking.

  30. I once had a publisher breach contract on me for a sum of money I could not afford to lose. I took it to court. The judge was shocked and appalled by what happened. I won.

    What publishers routinely do, or try to do, to writers is often shocking to people who don’t work in the industry. And then publishers wonder why so many authors are bailing out of traditional publishing now that alternatives such as self-publishing and crowdfunding are becoming more feasible.

  31. Katherine Roberts

    Glad to have a chance to read this post – my virus checker went crazy when I visited Kris’ blog recently and now I know why! Thanks for putting it up here.

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