Simon Kolz

A weblog by Simon Kolz

Book Publishing Contracts For Writers: What Should I Look Out For?

Dave, I just got a contract for a book from a publisher
that I haven’t worked with
before. These long, tedious legal documents just befuddle me, however! Would you
mind spinning through this and seeing what you think about the terms and clauses

Here are my thoughts on this contract. Note up front that I’m not a lawyer and
haven’t received any particular training in contract interpretation. I do have an MBA
and have spent lots of time with lawyers reading and rewriting contracts, however,
so I think my advice will be helpful. Also, as a note to my faithful readers, I cannot
review contracts for you without charging for my time, and frankly you’d be much
better off asking a lawyer to help you out anyway. 🙂

Rather than reproduce the entire contract, I’m going to just excerpt the highlights
and follow them with my comments or thoughts. I am deliberately not talking about
royalty percentage, advances, and other specific numbers because those aren’t
really appropriate to publish in a public forum of this nature.

.. there shall be no royalty payment on copies of the Book sold at less
than Publisher’s cost…

Determined by? Audited by? Actual number? These vague and hard-to-enforce
clauses always make me anxious because it’s built on trust without any ability for
you to audit the books (with most publishers, at least). What if the book has a retail
price of $19.99 and the publisher decides that $10 is their cost? Then any book
sold at any sort of discount are ‘less than the publisher’s cost’ and you don’t see a

NET RECEIPTS – For purposes
of this Agreement, the Publisher’s “Net Receipts” from sales shall
mean net profit received by the Publisher from sales of the Book,
less credits, returns and funds required for reprints.

Funds required for reprints is a printing / publisher cost of business, assuming that
I’m understanding what’s being referenced, and that cost
shouldn’t affect the author. This clause is bogus and should be eliminated.

All monies received for direct sales
will be held for a period of 12 months to allow for credits and

That’s ridiculous. All my MBA “future value of money” instincts cry
out on this one. If there’s a ‘hold on reserves’ that floats from
payment to payment, then que sera, sera, but having a 12 month lag is exploiting
the system without any benefit
to the author. I’d reject this.

TAXES – All payments made
under the terms of this Agreement will be subject to USA Federal
income tax withholding, as required by the United States Internal
Revenue Code.

No, these are royalty payments and I’m pretty darn sure that the
publisher doesn’t have to worry about taxes, just report them as
royalty income for the author to the IRS. If you read the 1099MISC filing
instructions on the IRS site, it explicitly says “include in this box gross
royalties (before reduction for fees, commissions, or expenses) paid by a publisher
directly to an author or literary agent or paid by a literary agent to an author.”

The only instance where this 1099MISC might not be relevant is if the author is
overseas, in which case the publisher needs to pay taxes on the amount that’s being
paid to the author. Not sure exactly how that’d be structured, but any halfway
decent accountant should be able to shed some light on this topic.

ACCOUNT – All royalties and
other income accruing to the Author under this Agreement shall be
credited to an account maintained on the records of the Publisher
(the “Royalty Account”), which Royalty Account will be charged for
all amounts paid or payable to Author, including any advance payments,
and for all amounts Author is charged, or obligated to pay, pursuant
to this Agreement.

This smells of some sort of cross-accounting trick, somehow. I’d kick this out. Each
book should have its own account or it should be explicitly stated that the account
will not interweave credits and debits from different projects.

OVERPAYMENT – If any person
comprising the Author has received an overpayment of money from the
Publisher or has an outstanding monetary obligation to the Publisher,
whether arising out of this Agreement or any other agreement with
the Publisher, the Publisher may deduct the amount of such overpayment
or outstanding obligation from the Royalty Account or any sums due
to such person under this Agreement.

And there’s the cross-accounting clause. Debt with one book should not affect
credit (royalties) with another book. Absolutely reject this. Each book project should
stand on its own two feet.

shall also be entitled to purchase additional copies of the Book
for the Author’s personal use (self-promotion) at a discount of
twenty-five percent (25%) off the suggested retail price of the
Book, plus the cost of shipping and handling, while the Book remains in print.

That’s ridiculous. The book should be available to the author at
cost plus shipping, not at a discount rate that’s less than the
discount a typical bookstore sees! At least 45% off, if not 60% off the cover price.
The publisher
shouldn’t try to exploit the author in this fashion. Theoretically, the author and
publisher are partners on this publication, after all.

AUTHOR’S CORRECTIONS – Author alteration
costs in excess of ten percent (10%) of the cost of the original
composition, and any expenses incurred by the Publisher in the
making of Illustrations replacing those originally submitted with
the Book, shall be charged to the Royalty Account.

I think it’s important to specify that it depending on why these changes are
required. If there’s a new version of the program and the screenshots need to be
replaced, or if there’s a major corporate reorganization or change in the laws or
economy, that’s not a cost the author should incur. It’s just part of the risk of trying
to capture in print an element of our fluid, ever-changing world.

COPYRIGHT – The Author hereby expressly grants,
transfers, and assigns to the Publisher full and exclusive rights to the Book,
including, without limitation, the copyright in the Book, all revisions thereof, and
the right to prepare translations and other derivative works based upon the Book in
all forms and languages…

And what payment does the author see if the publisher prepares a
translation or derivative work? Curiously that isn’t specified in the contract as far as I
can see…

The Publisher will register copyright
in the Book in the name of the Publisher in compliance with the
United States Copyright Law. If the Publisher supplies artwork
(including artwork for the cover of the Book), it may register
copyright separately therein in a manner satisfactory to the

Note that there are publishers who let the author retain copyright
of the material while the publisher copyrights the overall work. A
much nicer approach, in my opinion, much more respectful of the

Tip to new publishers: the author can retain copyright without infringing on
your rights of publication or compilation copyright.

The Author represents and
warrants that, except as previously disclosed to the Publisher in
writing, the Author has not aided in the preparation of and is not
under any obligation to any other publisher or person to prepare
any publication directly competitive with the Book, or which could
interfere with his or her performance of this Agreement or interfere
with or impair the sale of the Book.

And here’s the first glimmer of the non-compete clause. This is a
no-go. You need to have it either MUCH more specific (like “author
is under no oblig
ation and shall not produce any other work that
is specifically addressed at the introductory Bash shell script
programming audience, to be marketed online through Amazon marketplace
and other ebook venues”) or strike this entirely.

The publisher
doesn’t own you, the author, they’re just buying your words.

NON-COMPETITION – The Author agrees that so long
as the Book remains in print, the Author will not participate in the preparation or
publication of, or allow his or her name to be used in connection with, any work
which might compete with the Book or the exercise of any rights granted Publisher
hereunder. The Author may, however, draw on and refer to material contained in the
Book in preparing articles for publication in professional journals, for teaching
purposes, and for delivery at professional meetings and symposia, provided
appropriate credit is given to the Publisher and the Book.

Which, of course, is unacceptable. If I write a book for this
publisher called, say, Fifty Ways to Hack your Shell (Hey! That’s
a good title!) I would be prohibited from ever writing about shell
programming or, ostensibly, any Unix topic that included discussion
of shells because it *might* compete with the book.

This needs to either be much, much more tightly defined or removed

Actually, I hate all these non-compete clauses because they’re where you can really
see how most publishers stack the deck against the author, even though it should
be a fair, equitable and professionally respectful relationship.

OUT-OF-PRINT PROVISIONS – If at any time, the
Publisher determines that the demand for the Book is insufficient to warrant its
continued publication, the Publisher may declare the Book out of print. In such
event, the Author shall have the right to purchase the Publisher’s stock of
the Book, if any, at one-quarter (1/4) of the Publisher’s established list price, but
not below cost.

That’s just daft on the part of the publisher. If it’s out of print,
then they have a warehouse problem and they should just liquidate
the remaining books to the author even at just shipping costs. It’d
be cheaper than having to pay for them to be destroyed…

If the Publisher declares the Book
out of print, then upon the Author’s written demand, the rights
granted by the Author under this Agreement will revert to the

I’m not sure that’s consistent with copyright law. This is really
why it’s better to have the author retain copyright because then
once the book goes out of print the material naturally falls back
to the author anyway, without remembering to notify the publisher
in writing.

I hope that this review has been helpful and informative. What you’re willing to
accept in a publishing contract is directly affected by why you are writing the book
in the first place, so think through your motivations, the big picture, and your career
before you decide exactly what you’ll accept and what you’ll insist must be removed.
For the record, I have rejected contracts and lost writing gigs because of
unacceptable clauses. I think it’s worth it, but you, in my position, may not think so.

Again, just to reiterate, this is not offered as legal advice and I disclaim any
responsibility for your acting upon anything I’ve said herein! 🙂

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