The non-compete clause is one of horrors that authors often find in the bowels of the contracts they sign with traditional publishers. This clause normally states that the author will not publish any work that competes with the work that they signed up to deliver to the publisher. Many such clauses are vague as to what such competition means and often the ultimate determination of its meaning is left to the publisher. What are the practical consequences of this clause?
This clause in effect states that during the length of the contract the author cannot publish ANYTHING else that the publisher considers will compete with the book(s) said author is writing for them. If the author does, the publishers can withhold royalties, take the author to court to seek reimbursement of any advance that has been paid, and refuse to return the publishing rights to the books even if printing has been cancelled. This requirement is especially painful for writers whose advance from the publisher is not enough to make ends meet while they wait for their books to be published at the snail’s pace of traditional publishing. Some authors who have signed up with traditional publishers have had a rude awakening when they naively decided to publish something else on the side, and this is especially true if they did so with a notorious competitor of the publisher.
I have posted in my blog about the case of Kiana Davenport who had signed up with Penguin to publish a novel. Then she decided to self-publish some short stories on Amazon that Penguin had rejected. When Penguin learned about this they went ballistic and screamed at her over the phone that she had “betrayed” them with Amazon and demanded that she repay the advance she had received from them. Davenport had neither the money nor the tolerance for a long legal battle so she repaid the advance. Other publishers offered to publish her next novels but they all offered the same type of contracts Penguin offered, so she ended up signing with Amazon.
What is the usefulness of non-compete clauses when it comes to publishing books? The argument is that if an author signs a contract with a publisher and goes on to publish another book elsewhere, that other book will diminish the sales of the first, hurting the publisher. But this flies in the face of reader book-buying behavior. If the author publishes something else the readers like, then those readers will want to read other books by the same author, thus increasing sales of those books too. Traditional publishers tend to view book buying as a zero sum game. While that view has always been incorrect, it is more so in this era of e-books which take up no physical space and can be on the shelves forever. However, traditional publishers, if anything, are relying more and more on the non-compete clause or similar clauses to control authors and keep the rights to their books for longer periods of time.
So, if you are contemplating hooking up with a traditional publisher, do not rely solely on your agent. Get yourself a lawyer before you sign that contract and make sure you understand it. Above all beware of the non-compete clause!
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This clause in effect states that during the length of the contract the author cannot publish ANYTHING else that the publisher considers will compete with the book(s) said author is writing for them. If the author does, the publishers can withhold royalties, take the author to court to seek reimbursement of any advance that has been paid, and refuse to return the publishing rights to the books even if printing has been cancelled. This requirement is especially painful for writers whose advance from the publisher is not enough to make ends meet while they wait for their books to be published at the snail’s pace of traditional publishing. Some authors who have signed up with traditional publishers have had a rude awakening when they naively decided to publish something else on the side, and this is especially true if they did so with a notorious competitor of the publisher.
I have posted in my blog about the case of Kiana Davenport who had signed up with Penguin to publish a novel. Then she decided to self-publish some short stories on Amazon that Penguin had rejected. When Penguin learned about this they went ballistic and screamed at her over the phone that she had “betrayed” them with Amazon and demanded that she repay the advance she had received from them. Davenport had neither the money nor the tolerance for a long legal battle so she repaid the advance. Other publishers offered to publish her next novels but they all offered the same type of contracts Penguin offered, so she ended up signing with Amazon.
What is the usefulness of non-compete clauses when it comes to publishing books? The argument is that if an author signs a contract with a publisher and goes on to publish another book elsewhere, that other book will diminish the sales of the first, hurting the publisher. But this flies in the face of reader book-buying behavior. If the author publishes something else the readers like, then those readers will want to read other books by the same author, thus increasing sales of those books too. Traditional publishers tend to view book buying as a zero sum game. While that view has always been incorrect, it is more so in this era of e-books which take up no physical space and can be on the shelves forever. However, traditional publishers, if anything, are relying more and more on the non-compete clause or similar clauses to control authors and keep the rights to their books for longer periods of time.
So, if you are contemplating hooking up with a traditional publisher, do not rely solely on your agent. Get yourself a lawyer before you sign that contract and make sure you understand it. Above all beware of the non-compete clause!
***
If you like this blog you can have links to each week's posts delivered to your e-mail address. Please click here.
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