Authors and Contracts: Be Informed

Don't just read the contract, find out what all the clauses mean.
Don’t just read the contract, find out what all the clauses mean.

by Gina Burgess

General things for authors to know about Copyrights…

Brief summary of copyright protection:

When an artist creates a work of art, this art has a copyright. The copyright is a form of protection that is granted by the U.S. Congress. Essentially, the writer of a book has the right to

  • reproduce the work (make a copy)
  • prepare derivative works (i.e., a series of books like the Roselli and Isles series or characters in a series that you created)
  • distribute copies to the public by sale or other transfer of ownership, by rental, lease or lending; (sell print rights such as song lyrics and music)
  • perform the work (i.e., sell the rights to have a movie or TV show based on it);

Essentially an author engages in a sale of intellectual property which is known as the rights of distribution.

Rights of Distribution are what you sell when you give a publisher the right to sell your book. The contract is between the publisher and the distributor, not between the author and the distributor. Even though the author holds the copyright, the distributor has the right to sell the book to retailers. Everything over cost is paid to the publisher, and then the publisher pays the author the royalties agreed upon in the contract between the author and the publisher.

Authors who were published by Tate Publishing have learned the hard way that once you are published, all is not a cake walk. You run the risk of losing everything if the publisher goes out of business. And the publisher can be in business for more than a decade and still fold. It’s worse if the publisher goes bankrupt. The problem is the publisher’s creditors trying to retrieve their losses by taking YOUR royalties. However, a lot depends upon the state the publisher is registered in to operate.

The best thing is to Do Your Homework before signing the contract. Signers beware. In most states, ignorance of the law is no excuse. Therefore, know what the law says about contracts, or get your attorney to explain to you EVERY clause in the contract. If your attorney doesn’t know anything about the state where the publisher is, then research it on the Internet. It is not rocket science. Type into your browser the State and the words Contract Law. Several sites will come up. Take the time to read! Then you will know if creditors have the right to acquire your distribution rights and your royalties in order to pay them what the publisher owes them

Here are some things I learned about Oklahoma Contract Law:

Information about Author’s rights when a publisher files bankruptcy in Oklahoma (Tate Publishing):

http://law.justia.com/codes/oklahoma/2006/os23.html

  • 23-2. Damages as relief from forfeiture.

Whenever, by the terms of an obligation, a party thereto incurs a forfeiture, or a loss in the nature of a forfeiture, by reason of his failure to comply with its provisions, he may be relieved therefrom, upon making full compensation to the other party, except in case of a grossly negligent, willful or fraudulent breach of duty.

In other words, it is entirely possible that Tate will never have to compensate its authors any royalties because it could prove the losses it incurred caused it not to be able to pay royalties, therefore it was not a willful or fraudulent breach of contract. I’m not saying that is the case, just that it is possible.

http://law.justia.com/codes/oklahoma/2006/os15.html

  • 15156.  Real intention not expressed. Error to be disregarded.

When through fraud, mistake, or accident, a written contract fails to express the real intention of the parties, such intention is to be regarded, and the erroneous parts of the writing disregarded.

In other words, if you could prove that Tate intended NOT to pay royalties then the intent would rule. That is hardly likely to happen.

  • 15-217.  Restraint of trade.

Every contract by which any one is restrained from exercising a lawful profession, trade or business of any kind, otherwise than as provided by Sections 218 and 219 of this title, or otherwise than as provided by Section 2 of this act, is to that extent void.

If a contract has been formed and one party fails to perform on the contract which results in damages, the damaged party may sue for breach. “Accompanying every contract is a common law duty to perform the contract with care, skill, reasonable experience and faithfulness the thing agreed to be done. A negligent failure to perform these duties is a tort and a breach of contract.” Leak-Gilbert v. Fahle, 55 P.3d 1054, 1059 (Okla. 2002)

The above is saying that your contract is breached, Tate’s creditors can go after your royalties to recover their losses because of the distribution rights. IF you sign the contract termination then creditors cannot distribute your work and keep your royalties in order to recover their losses during the course of bankruptcy.

In other words, you have this very strong leg to stand and balance upon. There is nothing according to Oklahoma law that can keep you from republishing your book or books: past, present, and future (if you signed a lifetime contract with Tate). Even if you do not sign the contract cancellation.

There is always the choice of self-publishing your books. We at Authors Community are happy to help you and to teach you how to do this as quickly or as slowly as you desire. You have the work of astounding virtuosity. We have the skills to help you get your works into the hands of your readers. We’d love to work together to achieve your publishing goals.

7 thoughts on “Authors and Contracts: Be Informed”

  1. Thank you, Gina. This thing with Tate Publishing is a tragic event, not only for the the Tate authors, but the entire publishing industry. Tate has had numerous complaints over the last couple of years, yet authors continued to contract with them. Doing due diligence is critical. Planning is crucial. Being in a hurry to publish a book works against the author. Take a lesson from the Tortoise and the Hare. Slow is fast and fast is slow in the writing profession.

  2. My name is Ron Clark, author of The Prophet’s Secret and I am a victim of Tate Publishing’s closure. I did a great deal of internet research into numerous publishing companies and I came across Tate. I researched the company on the web and for whatever reasons I did not find any real negative reviews, at least any more than I found for other such publishers. The price was equitable and even discounted with an end of year offer to pay in full and receive a 50% discount. At least I did not pay full price and lose all that money. The beginning process went well but then it slowed down when it came time for creating an author’s web site and the book trailer. Finally, those two things were left undone. My book was released on July 5, 2016 and two book signings were arranged by Tate and I arranged three events on my own. During this time I wasn’t receiving any real publicity that was promised by Tate. I contacted them by phone and email about the book trailer and the web page several times and was promised a future response. I received two small royalty checks well into the second quarter and when I inquired about the delay after the third quarter, Tate sent one more response and then stopped communicating with me completely. (I’ll attache a copy of the last response about royalties at the end of this reply) After my two library events, I could once again concentrate of Tate matters and I tried to open their web site to send another email and look for alternated phone numbers and the Tate announcement of closure automatically appeared. I’ve canceled my contract with Tate using the form attached to the web page and have not received any response. I’ve filed a complaint with the Oklahoma Attorney General’s Office with not real expectation for results and to date I haven’t been disappointed. I’ve chosen to re-write the entire manuscript and seek other means of publishing. “Making good decisions is a matter of experience and most experience comes from making bad decisions.” I forget who said that but it is so true.

    1. Wendy, did you pay for the book illustrations? Did you sign a copy that acknowledges Tate as the copyright holder of the illustrations that restricted your use of them in any promotions? Did you pay an illustrator separately from Tate? If Tate kept you as the copyright holder of the book (you find this on the copyright page), and Tate only kept the distribution rights, then you own the copyrights of everything including the illustrations. Unless you signed a contract with an illustrator who kept the copyrights of the illustrations — usually found in agreement form between a children’s book author and the book’s illustrator. You can find out more at Copyright.Gov on the Internet.

      1. It says on my book ” HugginJesus Copyright2015 by Menetta Olan. All rights reserved. Book design copyright 2015 by Tate Publishing LLC All rights reserved. Cover and interior design by Rhezette Fiel . Illustrations by Hilbert Bermejo

        1. Okay, it looks like Tate has the copyright to the book design while you maintain the copyright for the content as in words. I know Oklahoma Attorney General is working toward getting all the rights back into the authors’ hands. I don’t know how far along he is in the process, but you can contact his office. Just search for Oklahoma Attorney General contact info.

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