A royalty statement should be simple to understand, right? “Show me my sales and my royalty rate, perform a simple mathematical calculation, and — boom! There’s my royalty check!” But how often have you looked at your publisher’s royalty statement and muttered, “I have no idea where these numbers are coming from,” and spent hours trying to understand the calculations? Or perhaps you’ve become so frustrated that you simply gave up, took the royalty check out of the envelope, cashed it, and threw the rest of the statement in the recycling bin, reassuring yourself that the amount must be correct if it’s this complicated.
Collecting unpaid royalties: Trends, traps, and litigation strategies in textbook royalty enforcement
Much has been written about changes in the college textbook marketplace over the last decade. The industry has adapted to new pedagogical methods, the proliferation of digital learning materials, and profitability pressures felt by publishers — all leading to significant innovation in the publication of learning materials. Some observers have concluded that we may be witnessing the death of the textbook as we have known it.
As the textbook publishing marketplace has changed, so too have relationships evolved between authors and their publishers. Commercial arrangements forged in the era of print media — which were amended and extended over time to apply to the publication of new editions — have been impacted by these industry-wide changes.
How to part with your publisher when your textbook goes out of print
During the 2017 TAA Conference session, “Wanna Get Away? Maybe Now You Can: Parting with Your Publisher,” intellectual property attorney Stephen E. Gillen, a partner at Wood, Herron & Evans, said that one event that can open the door to parting with your publisher is when your textbook goes out of print.
When and how your textbook goes out of print is governed by your contract, said Gillen, which means it’s best to think about these situations in the early stages of negotiating your publishing contract. “They [your publisher] are probably going to be more inclined to make changes in that language in the beginning than they would be somewhere along the way,” he said.
Intellectual property attorney: First-time textbook author has leverage in contract negotiations
Stephen E. Gillen, author of Writing and Developing Your College Textbook: A Comprehensive Guide, says the first-time textbook author definitely has leverage in contract negotiations, and can negotiate changes in the standard publishing agreement.
Textbook contract clauses: Understanding advances and grants
An advance is a pre-payment of royalties to be earned upon the publication of your textbook. It will be recouped out of the royalties first accrued from the commercial exploitation of your work. It is not incoming for publishers to agree to advance from 50% to 100% of expected royalties on projected first year sales. The advance may or may not be refundable if your manuscript is rejected and your contract is cancelled.
A grant, conversely, is a payment intended to cover some or al of the out-of-pocket costs of research and/or manuscript preparation. It is generally not recouped out of accrued royalties, and like the advance, may or may not be refundable in the event the manuscript is rejected.
5 Things to consider when negotiating your textbook contract audit clause
One of the most important provisions in your textbook publishing contract is the audit clause, which will specify the conditions for how and when you can request and conduct an audit. In the absence of an audit clause, some publishers will still comply with a request to audit, although they are not contractually required to do so.
While the large publishers have calculated and paid royalties to thousands of authors, contract terms can vary, automated royalty systems have limitations, and the accounting teams at publishers are made up of human beings who can make mistakes. If an author wants a better understanding as to the calculation and accuracy of his or her royalties, the best course of action is to request a royalty audit.