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

Dave, I just got a contract for a a course in miracles 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 herein?

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 dime.

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 returns.

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.

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