Penguin Group Sues Writers Over Book Advancesby
Penguin Group (PSON:LN) wants its money back. The publishing house has filed complaints against several authors, including Elizabeth Wurtzel (author of Prozac Nation) and Ana Marie Cox (founder of Wonkette), seeking repayment of the multi-thousand-dollar advances they received for books that they allegedly never delivered. While everyone agrees that Penguin is within its legal rights to try to recoup what collectively amounts to more than $577,000 from the dozen or so authors who took money for nonexistent books—or, in some cases, books that came out years behind deadline and under a different publisher—few in the industry think they should.
“This is precisely analogous to the fact that some airlines now charge for pillows,” says publishing attorney Jonathan Kirsch. “Publishing is in so much economic trouble. You have a distressed industry asking themselves, ‘Where can additional revenue come from?’” Airlines find that money in pillows and checked-luggage fees; Penguin Group is just calling in debts.
In standard book contracts, an author often receives a chunk of money before he or she actually writes the manuscript. Advances range from a few thousand dollars to as much as $15 million, which Bill Clinton reportedly received for his 2004 memoir My Life. Most contracts include a clause that says that if the author fails to deliver the work, if the book is late, or if the publisher no longer wants the work, the contract can be terminated and the advance must be repaid. But there used to be a sort of gentleman’s agreement between publishers and authors that these terms weren’t so much rules but guidelines.
“The business relationship between authors and publishers is one of trust, and it’s oftentimes finite,” says Robert Gottlieb, chairman of the Trident Media Group literary agency. “There are many reasons that publishers can reject a book which they have in contracts—legal reasons, editorial reasons—and if you create an atmosphere with authors where you can reject their book and ask for the money back, they’ll feel that they’re at risk,” he says.
But these books weren’t rejected; they just didn’t appear, with a couple of exceptions. In 2007, Baltimore mega-church pastor Jamal Bryant was set to write a book that “inspire[d] men and women to be empowered through faith in God,” but then allegedly had a sexual relationship with an underage church member and Penguin canceled the book. A year later, Holocaust survivor Herman Rosenblat agreed to write a memoir for Penguin’s Berkley Books imprint about how he married a young woman who saved his life in a concentration camp, but his story turned out to be untrue and Berkley terminated the contract. The other suits deal with payments for manuscripts that the authors never turned in.
Authors have been sued for advances before. In 2005, Random House went after the $300,000 it had paid P. Diddy in 1998 for an autobiography he never wrote. And in 2008, Harper Collins sued Victoria Gotti for the $70,000 advance she’d received for a memoir she was supposed to have turned in three years before. As self-publishing and e-books become more popular and accepted (remember, Fifty Shades of Grey was originally Twilight fan fiction), hefty book advances have come to be seen as an increasingly impractical way for cash-strapped publishers to spend their money. But they do still serve a needed purpose for both writer and publisher.
Most authors receive advances in the tens of thousands of dollars. That’s a sizable chunk of change for many people—especially a new or unknown writer—and can provide a financial cushion as an author finishes their work. Additionally, says Jim Milliot, co-editorial director at Publisher’s Weekly: “Advances for major authors keeps them from self publishing or publishing elsewhere. I mean, if you were assured a bunch of money up front, would you really take the chance of maybe not making that?”
What’s so interesting about these particular lawsuits, though, is the size of the advances that Penguin’s seeking to recoup. None breaks the $100,000 mark and only two of them exceed $50,000. One author is being sued for $24,000 for a book on the history of fishing lures while another owes just $12,000 for an account of America’s status as a “pack rat nation.” (The deal was made just months before A&E first aired Hoarders).
Even Wurtzel, who seems to have never written the 250-page “book for teenagers to help them cope with depression” that she’d agreed to deliver to Penguin in 2004, was only paid $33,000 for it. “These are not large sums of money,” Gottlieb says. “These are write-offable.” It seems strange then, that Penguin would suddenly go after such relatively modest amounts. “That’s another indicator of the level of distress,” says Kirsch, “this amount of money is actually worth it to them to gin up a lawsuit about.” Penguin declined to comment about the lawsuits and whether they mark a permanent policy shift at the publishing house. In a statement, Penguin said only that it took legal action against its former authors “reluctantly, only after its repeated attempts at amicable resolutions were ignored.”
Even if they amount to a one-time occurrence, the cases could dramatically affect Penguin’s business. Gottlieb’s agency released a statement yesterday saying: “If Penguin did this to one of Trident’s authors we could cut them out of all our submissions.” He softened the threat when I talked to him on the phone. “It’s not that Trident wouldn’t work with publishers who do this, but we certainly wouldn’t put them high on our list,” he says. “I would advise any publishing company that the trade-off that you get out of these suits—the money you receive vs. the negative publicity—it’s not worth it.”
If Penguin Group remains the only publishing house to go after such small amounts of money, Gottlieb is probably right. But if more publishers start seeking repayment, there may not be much authors can do about this toughened stance but grumble and sign the contracts. “This is an absolutely standard contract term. It’s just that Penguin, in a very dramatic way, has actually decided to enforce it,” says Kirsch. “Very few people will actually refuse to do business with them over this. There’s nothing more yearnful than an author seeking publication.”