1. lostinwebspace
    Offline

    lostinwebspace Active Member

    Joined:
    Mar 5, 2011
    Messages:
    466
    Likes Received:
    17
    Location:
    Canada

    Got a Contract With Some Not-so-nice Clauses

    Discussion in 'Publishing' started by lostinwebspace, Jul 10, 2012.

    I was recently offered a contract for a novella I wrote. The publisher is not very big (in fact, just starting out) and there are some things that don't sit well with me.

    First, there is a right of first refusal clause in here: "Publisher will have rights of first refusal on all works by the Author to expire three years after first release of the latest work." I find these ROFR clauses distasteful. They protect the publisher and limit the author. Aside from that...three years? Isn't that excessive? If I see a perfect fit for any other work I write, I have to give it to this publisher first for three years after!

    Next, this book will (at least thus far) only see e-print. There are hard copy clauses in the contract, but AFAIK there are no plans to go that route yet. This doesn't bother me so much.

    Last, I'm getting 20%-35% of the sales from price point, depending on what that price point is. Is that a normal division of sales? The publisher gets 65%-80%, whiel I get only 20%-35% for my own work?

    To be fair, the contract isn't so one-sided in the publisher's favour. There are things protecting me against the publisher. But these things stick out. I'm not in it for the money, but I'd hate to think I'm getting swindled here. And I want that ROFR clause gone. How do I go about suggesting modifications to the contract or negotiating these details? E-mail the publisher? Just cross out the unwanted parts and notify the publisher? Send a signed copy with the modification and tell the publisher what I've removed? What's the protocol here? Or are these at all reasonable things?
     
  2. Complex
    Offline

    Complex Senior Member

    Joined:
    Jun 28, 2012
    Messages:
    120
    Likes Received:
    3
    25% of the money from each book sold? Most royalties are like 10%, so that's not so bad. The right of refusal should be specifically words for 'sequels' or such so that succeeding work must first be offered to that publisher instead of another publisher. If they refuse then you can take it to another publisher. It a 'we get first dibs' thing, but I would ask for the publisher to define it for you and make clear ANY part of the contract, preferably in non-legalese writing. Most publishers are (reasonably) afraid that a successful work they acquire and distribute could be picked up by another publisher without this specific clause. Let's just say J.K and Harry Potter. Book 1 was a success, but since (hypothetically) 'right of first refusal' wasn't in the contract a bigger name publisher offers to buy Book 2 with oodles of money. Book 1's publisher is now out of the loop and the rights will become a legal mess very quickly. The publishers intent is not to lock down your work, but to make sure that you let them decide whether or not they want to publish another work before you go hoping off to another publisher for 'greener pastures'.

    A contract should always be win-win for both parties, if you do not like the terms you have an obligation to try and negotiate it. If you are going to regret it then your publisher will as well, the ideal contract should trade work for appropriate compensation. Though the terms don't seem exactly bad to me, very generous, even for a small publisher.
     
  3. psychotick
    Offline

    psychotick Contributing Member Contributor

    Joined:
    Feb 10, 2011
    Messages:
    1,377
    Likes Received:
    315
    Location:
    Rotorua, New Zealand
    Hi,

    First up, congratulations.

    Second I agree with Complex. Ask them to specify what they want first rights of refusal for. Having said that, its not a terrible thing. If you write something else and they don't like it you can get to send it somewhere else. But make sure that their first right of refusal ends within a certain time period, i.e. if they don't like it, then say two months after they've seen it and presumably said little, you can take it elsewhere. Contracts should be a negotiation.

    Lastly have you got a legal friend you could take it to? That could be of use.

    Cheers, Greg.
     
  4. marktx
    Offline

    marktx Contributing Member

    Joined:
    Jun 21, 2012
    Messages:
    202
    Likes Received:
    8
    Next, this book will (at least thus far) only see e-print. There are hard copy clauses in the contract, but AFAIK there are no plans to go that route yet. This doesn't bother me so much.

    Last, I'm getting 20%-35% of the sales from price point, depending on what that price point is. Is that a normal division of sales? The publisher gets 65%-80%, while I get only 20%-35% for my own work?


    My hope is that there is a very solid commitment of some kind regarding promotion. Since this is a new publisher and they are only doing ebooks (which you can do yourself at 70% of the cover price), I guess I'd like to know exactly what they are bringing to the table. If there was a print run with distribution, that would be different. But just ebooks? What advantage are they providing?
     
  5. TWErvin2
    Offline

    TWErvin2 Contributing Member Contributor

    Joined:
    Nov 30, 2006
    Messages:
    2,529
    Likes Received:
    561
    Location:
    Ohio, USA
    Right of First Refusal clauses are common but to be avoided if at all possible, or limited. It is reasonable to request right of first refusal, as I see it, for future works related to the work they published--ie including the same characters and/or taking place in the same setting/world (if it's fantasy or SF). But not for any work the author produces in the next three years--not for a start up that isn't paying the author a major advance.

    Also, the right of first refusal should be limited in time/scope for the publisher to accept or pass, 60 days or less. This publisher has no track record. What if they're irratic in payment and promotion and such. What if they get a bad name because some of the titles they put out end up being poorly edited or crap? You're stuck with them for 3 years--because you published a novella with them?

    If they are not willing to eliminate or negotiate the language on this clause, then, if it were me, I'd move on and try to find a different publisher. Heck, the way that clause is worded, everytime you publish with them, the three years is reset, based upon that contract, unless you could get the original clause nullified in future contracts. And it's based upon publication. What if they accept the piece, the contract is signed, but it takes them a year to get the work into print. Then techically, anything you write for four years is theirs to publish first, even if some publisher were to offer you a huge advance. They don't even have to match it. And "All works" means anything--even articles, novels, novellas, short stories, poetry, etc. (okay, I'm rambling a bit, but you get the point).

    It is rare for a novella to go to print. The length often doesn't make it a cost effective venture, although the range of word count for novellas varies greatly. The more words, the better the potenial payoff. If you can limit it such that if they don't take advantage of the print rights within a year, then they revert back to the author--that would be good. Also, be sure that all other rights not named in the contract remain with the author (foreign language rights, audiobook rights, etc.).

    Ebook royalties are all over the board. Some as much as 50%, some as low as 25% of the cover price. I've not heard of 20%, but maybe it depends on how the reimbursement is structured.

    How much have you studied contracts? There may be a lot more in there that is nonstandard and nasty. How and when do rights revert to you? Are there any non-competion clauses? How long from signing the contract does the publisher have to bring it to print/publication? In whose name will be the copyright be made--I've seen contracts where it went to the publisher, and it wasn't a work for hire contract. Those are just a few examples.

    Here's a link to some model contracts (SFWA--the Science Fiction and Fantasy Writers of America). They're a bit dated, but might give you some guidance: SFWA Sample Contracts

    If you're unsure, it might be a very wise idea to find a literary attorney and pay a fee for them to review the contract. It's a legally binding document and could really mess up the launch of your writing career if it contains some nasty stuff. As the publisher is new, it may be that they're not aware how unfavorable to the author some of their contract's clasuses are. On the other hand, maybe they are aware.

    How do you handle negotiations? If you don't get an attorney to help? That's tricky. I won't give you advice here other than not to sign anything you're not completely satisfied with and fully understand. When I negotiated with my publisher, I'd already reviewed and signed a number of contracts for short stories (for magazines, ezines and short stories). There were clauses I was not satisfied with, and emailed the publisher, suggesting language that would be acceptable to me. It took weeks with several back and forths.

    If an author doesn't have any idea about publishing contracts, negotiating one is like entering a minefield after midnight under a cloudfilled sky while wearing sunglasses, and marching through it.
     
  6. Faust
    Offline

    Faust Contributing Member Supporter

    Joined:
    Jul 2, 2010
    Messages:
    206
    Likes Received:
    9
    Location:
    Amongst the Populace [Michigan]
    Another often overlooked consideration is that there are some minor laws that affect contracts that vary from state-to-state, if your publisher is an 'out-of-town' business, make sure your state doesn't have any bizarre contract laws. Hey, here in Michigan it's illegal to tie your alligator outside the post-office (Proof that legislation doesn't essentially require logical validation...alligators seem ALWAYS out of season up here...), so it's best to make sure there aren't any obscure legal matters that can blow up in your face. I imagine this could be worse if your publisher exists outside of your country.

    So yeah, echoing earlier statements, get an attorney to peruse it, the cost of his/her fee would be an investment if there's anything not-so-nice hidden in the fine print.
     
  7. Patrick Gallant
    Offline

    Patrick Gallant Member

    Joined:
    Jul 4, 2012
    Messages:
    21
    Likes Received:
    1
    Location:
    Edmonton
    Hey,

    I'm a new author and I've literally no experience with contracts. That being said, it's almost always a good idea to have any legally binding document read by a lawyer, especially on the touchy subject of intellectual property. I don't consider any of my work to be world changing or even inspirational, but at the very least I want it to remain mine for the long haul. Right of first refusal is an understandable request for a publisher as written above, but I don't think I would let it blanket everything I wrote down. That seems like it might be shooting myself in the foot for a number of reasons.

    Is there always a contract for works? For example if I simply sell a 12,000 word story to a publisher for a fixed dollar amount with no further contact with them, will a contract still be involved, or is it a once-and-done thing?

    Just curious. I'd still like to be protected by a contract either way.

    Regards,
     
  8. TWErvin2
    Offline

    TWErvin2 Contributing Member Contributor

    Joined:
    Nov 30, 2006
    Messages:
    2,529
    Likes Received:
    561
    Location:
    Ohio, USA
    There should be a contract, even if an author is being published by an ezine that pays nothing but provides 'exposure' or an anthology that pays the author through several contributor copies of the anthology. Those contracts are normally nonexclusive, and the author is free to publish or post the story elsewhere, once it reaches print in the first market.

    Most short stories pay a fixed dollar amount for a story, say a flat rate of $5 or $25 or $100 per story. Sometimes it's 1/2 a cent or 5 cents a word (5 cents is considered pro rates, at least by the SFWA). It is all over the board, but in my experience, few anthologies pay a royalty and go for a flat rate to contributors. However it's possible (happened with two of my published works--basically I get $0.25 a copy sold for one, and $0.05 per ebook copy sold for the other). With each sale of short fiction, I've always signed a contract. I'd be concerned if a contract wasn't offered.
     
  9. marktx
    Offline

    marktx Contributing Member

    Joined:
    Jun 21, 2012
    Messages:
    202
    Likes Received:
    8
    Ebooks-only is a radically different business model from the traditional publisher/bookstore model, and it has important implications. Since a traditional bookstore has limited shelf space, they don't want to carry crap. If the books don't sell, they tear off the covers and send them back to the publishers, who must then refund the money.

    So if you are talking about a print run, there are powerful economic incentives for the publisher to vet properly, promote properly (although you'll still be expected to help promote), etc. The distribution channels are extremely restricted for printed books for the economic reasons just outlined.

    But if a publisher offers a contract which is ebook only, all those economic incentives go right out the window. Publishers do all that vetting and marketing because the financial risk for them is real and they need to reduce the odds that they are laying an egg in the marketplace. But if there is no cost associated with a print run or a risk to the distribution channel (which there really isn't in the ebook sphere), then there is no financial risk associated with taking on any titles, uploading them, and then sitting back and enjoying a cut of the proceeds (in this case, the bulk of the proceeds) from whatever sells.

    So if the contract is ebook only, then it needs to be completely clear exactly what they are bringing to the table. Without the financial risk of a print run and the access to restricted distribution channels, what exactly are they offering you?
     
  10. TWErvin2
    Offline

    TWErvin2 Contributing Member Contributor

    Joined:
    Nov 30, 2006
    Messages:
    2,529
    Likes Received:
    561
    Location:
    Ohio, USA
    There are financial risks, even if a novel is released only as an ebook. Hopefully the publisher a writer has researched and selected does more than read the novel, accept it, sign a contract and then shove it out there on Amazon (Kindle), B&N (Nook), Smashwords, Kobo, iTunes, etc. If that's all a publisher does, then they are not a publisher, and should be avoided.

    Editing, Cover Art, Layout, Copyright Registration, etc. That all costs both time and money. Someone has to pay the artist. Someone has to pay the editor. Even if the managing editor is the publisher, it is still a time-intensive investment to edit a novel. Yes, ebook only = less financial risk, but it isn't eliminated.

    With POD technology, print isn't that much more expensive include. There isn't the problem of print runs and warehousing investments, but ISBNs and costs to register/renew yearly for distribution through Baker and Taylor and/or Ingram via Lightning Source for example. The cost per book printed is higher with POD than offset print runs, which can make it difficult to compete price-wise.

    But the point is, there is a financial risk. In addition, if a publisher gets a reputation for putting out crap, it can adversely affect sales all their titles. If a publisher puts out solid works, it can positively impact sales. Sure, many readers don't pay attention to publisher, but some do. And if someone buys a real turkey, that reader will remember it, and maybe details about it--the author at least, if not the publisher.
     
  11. Cowboy
    Offline

    Cowboy New Member

    Joined:
    Jul 5, 2012
    Messages:
    7
    Likes Received:
    0
    If it's just ebook then why not self publish?
     
  12. HorusEye
    Offline

    HorusEye Contributing Member Contributor

    Joined:
    Jul 25, 2009
    Messages:
    1,215
    Likes Received:
    48
    Location:
    Denmark
    I was thinking the same thing. Going through a publisher with an e-book is kinda like going to the postoffice buying a stamp for sending an e-mail.
     
  13. B93
    Offline

    B93 Active Member

    Joined:
    Jul 23, 2012
    Messages:
    297
    Likes Received:
    32
    Change it so the 3 years starts when the contract is signed, not when they (might) get around to publishing your first story, and only if there is something in common with the present story. If you write in more than one genre, you don't want to be waiting forever for their refusal of something unrelated to their market (if they have a market, which has been called into question by others).

    Does this small outfit get ISBN numbers for you?
     
  14. Morkonan
    Offline

    Morkonan Senior Member

    Joined:
    Jul 18, 2012
    Messages:
    101
    Likes Received:
    7
    I agree.

    However, the publisher may have some agreements with e-booksellers. Front-page spots, spotlight marketing, search-engine teasers, etc.. I would suggest reviewing exactly what the publisher is going to provide in the way of additional marketing services and what they are going to guarrantee you that relies on their existing agreements with e-booksellers and internet advertising.

    What is it that they have access to that you, as a potential self-publisher, would not? If the answer becomes shorter and shorter each time you review their capabilities, you may wish to consider another publisher or even self-publishing.

    However, and this is a consideration along an entirely different avenue, you have to weigh your decision with the future advantages offered to you by accepting this contract. The foremost of those are - You can say that you have been published! That, alone, could help you get exposure and lend your future query letters more credibility in terms of implied performance. If an editor sees that you have already been published, it means that someone has already seen your previous work and it was worth paying money for. That implies that your submitted work may also be worth paying money for... It's something you should consider in that light. After all, if you can write one book or a series and someone thinks it's good enough to pay for, you can probably write three.
     
  15. tundrawolf
    Offline

    tundrawolf New Member

    Joined:
    Jul 26, 2012
    Messages:
    1
    Likes Received:
    0
    Well, let's say you have a novel, and it falls under the ROFR clause. If they like it and want to print it, but they want to give you .000001% of the profits, can't you just refuse their offer and go to someone else? Or it doesn't work that way?
     
  16. B93
    Offline

    B93 Active Member

    Joined:
    Jul 23, 2012
    Messages:
    297
    Likes Received:
    32
    ROFR means they call the shots, not you. You should insist on knowing ahead of time how the rate would be set (maybe not the actual number, but the process) for follow-on works.
     

Share This Page