Thursday, November 04, 2010

Agent Sues Author and Loses

In 2004, mystery writer Martha Grimes took on the publishing industry with her novel Foul Matter. Here's an excerpt from the Publishers Weekly (PW) review:
When Paul Giverney, a hot suspense novelist, seeks a new publisher, he decides on the house of Mackensie-Haack under the condition that they dump their highly respected and award-winning author, Ned Isaly. Ruthless president Bobby Mackensie will stop at nothing to sign Giverney, even though breaking Isaly's contract is a legal impossibility. His solution? Sign another contract--this one with two hit men, who are hired to knock off Isaly.
The novel was a wicked satire about the publishing industry written by an author who had once been "fired" by Knopf when her books failed to earn back their advances. The title was an inside joke. Foul matter is an industry term for an unedited manuscript.

I don't own any of Grimes' other novels, but I have two copies of Foul Matter on my shelf--one to keep and one to loan out.

At the time the novel was published, Martha Grimes' agent was Peter Lampack of the Peter Lampack Agency. Grimes signed with Lampack in 1996 and remained with him until 2007. According to PW, she earned more than $12 million from book sales during those years.

Six months ago, Grimes published a new novel, Black Cat. And, a year ago this month, Lampack sued Grimes, claiming she owed him for the forthcoming release. According to court documents:
“PLA [Peter Lampack Agency] alleges the agreement for The Black Cat arose out of the Option on Next Work clause and that Grimes violated the terms of the 2005 Penguin/Viking-Penguin Agreement by refusing to account PLA and refusing to pay PLA the sums due for The Black Cat.”
According to Publishers Weekly:
But the court found that under the "commission provision" Lampack was entitled only to proceeds from the sale of her literary works, and didn't have an interest in the literary works themsevles (sic), making it possible for Grimes to revoke Lampack's "agency" which she did in May 2007, thereby removing any obligation for Grimes to pay Lampback for future works.
The important part of that ruling is that Lampack was entitled only to proceeds from the sale of her literary works. He did not have an interest in the literary works themselves.

I've seen a fair number of literary contracts--both agent and publisher--over the last six years. Many of my writer friends forward me copies of their contracts. I've found wide variance in wording.

For example, an agent contract which states that the agent is entitled to proceeds from the sale of any book written during the term of this contract is very different from a contract which states that the agent is entitled to proceeds from the sale of any book on which he brokered the contract with the publisher.

If a writer signs a contract giving the agent rights to a book written during the term of the contract and the writer later moves to another agent, it might be possible that she could end up paying a 15% commission to two agents (the one who she was with during the time the book was written and the one she was with during the time her new agent sold that book).

I asked my attorney to vet my agent contract before I signed. My agent was open to clarifying a couple of clauses that my lawyer wanted tightened. And I've been thankful for how diligent my agent has been in policing my publisher contracts.

In 2004 (the same year in which Foul Matter was published), Publishers Weekly warned writers against an "interminable rights clause" here:
The contract provision ... means that even if the original publishing agreement has ended, the book has gone out of print or the author's agent leaves the agency, the agency continues to be the agent of record for the work. The practice contrasts with that of some other agencies, which give up their claim on a work once the publishing agreement the agent negotiated ends.
Writer Beware! also warned against contracts where "the agency claims the right to remain the agency of record not just for the duration of any contracts it negotiates, but for the life of copyright. In other words, once the agency sells your book, it has the right to represent that book for as long as the book is in copyright (currently your life plus 70 years)."

Lampack has made a motion to the New York Supreme Court to reargue the case. This case has huge implications for the author-agent relationship.

Go here to read Tuesday's article in Publishers Weekly.

Go here to read the 2004 PW article on the interminable rights clause.

Go here to read the Writers Beware! blog on interminable rights.

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