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What happens to books in inventory, under contract when publishers sell lists?

Q: “What happens to books in inventory or those under contract when publishers sell lists to other publishers? How can we find out whether books have been stolen or put into the hands of resellers?”

A: Don Collins, author or co-author of seven school mathematics textbooks, and former Managing Editor of Mathematics at Merrill Publishing:

“I can answer for what I know happens with el-hi educational textbook publishers. When a text is accepted and put on an adoption states approved list, the publisher must agree to keep a supply on hand for up to 8 years. At the end of all of the adoption states contracts, if there are not sufficient other sales then the publisher may decide to ‘remainder’ the remaining stock. That is, they will sell the texts at a vastly reduced price to a firm that deals exclusively with back issue texts. These firms deal with small markets and have large markups. Most publishers do offer the outdated texts to the author at the reduced price and do not usually pay royalties on the lower priced texts. One can assume that when royalty payments become small then the publisher is considering putting the book on the remainder list, particularly if they have quite a stock of the texts.”

A: Stephen E. Gillen, Attorney, Wood Herron & Evans:

“It depends upon the deal between the two publishers. Typically, the acquiring publisher buys the inventory along with the contracts. Then they sell it out or destroy it so they can produce a new printing under their imprint. It’s also possible that the acquiring publisher would have no interest in the existing inventory under the old imprint and would require, as a condition of sale, that the selling publisher destroy the inventory. Regardless of who sells the books, the author should get a royalty in accord with the terms of the publishing contract (of course, if the books are remaindered that royalty may be small or nonexistent depending upon the terms in the publishing contract). In any event, any sales should be reflected in the next royalty statement. If there is a question, ask the new and old publishers to provide an inventory reconciliation.”