The Essentials of Collaboration Agreements for Literary Works

Compensation

Compensation to the writer usually is at the forefront of discussions. There are various ways to pay a writer, but they tend to boil down to flat fees, percentage fees and combinations of the two.

Before a book is written or a publishing agreement concluded, an outline or treatment and a sample chapter or two by the writer often will be submitted to an agent or publisher. The subject may choose to pay the writer for this out of her pocket, but if the writer believes that the book has high commercial possibilities and is willing to speculate that there will be a lucrative publishing agreement, he may be willing to accept only a percentage of the monies received by the subject from the publisher (and perhaps other sources) if the book is sold.

The writer might seek a minimum fee as an advance against his share of all revenue and a flat “kill fee” should the subject have the right to terminate without cause and exercise it. The subject, on the other hand, might seek to compensate the writer with nothing beyond a flat fee, payable in installments linked to milestones in the book's progress toward completion.

In a percentage arrangement, generally the relative prominence of the subject and the writer will greatly influence their respective shares. Rarely will the writer receive more than 50% or less than 20%.

Often the project is represented by an agent who is entitled to a commission. Whether or not that agent represents both subject and writer, the agent's fee, which is usually 15% of the amount paid by the publisher, will be deducted “off the top” from amounts paid by the publisher in computing the writer's share.

The writer most often will be entitled to receive a percentage of book and e-book payments made under foreign and domestic publishing agreements, as well as other sources of income, such as audio and enhanced e-books when licensed to the publisher. Often negotiated is whether the writer also will share in exploitation that is not covered by the publishing agreement, such as motion picture or television productions derived from the book. If payments from those sources are included, what happens if the studio's payments are divided to cover separately rights in the book, the subject's life story rights (which might extend beyond the scope of the book), and services by the subject (e.g., as executive producer or consultant)? Will the writer receive a percentage of payments for rights and services other than the grant of rights to the book?

What if the manuscript isn't accepted by the first publisher and the subject has to return the advance in whole or in part? Will the writer have to return to the subject a portion of the fee the writer previously received? What if the book isn't accepted but another publisher acquires it while agreeing to pay a smaller advance? Because the writer is largely responsible for how the book is written and its ultimate appeal to publishers, repayment of a corresponding part of the differential wouldn't seem unjust from the subject's point of view. The writer, though, may consider that the subject's omission of portions of the story that would spice it up would be more to blame for rejection than his or her own sterling prose.

And if the book is sold to a publisher by an agent, and the publisher rejects the manuscript, the subject may need to return the entire advance including the fee paid to the agent. Because the agent considers the agent's work done, he or she will not be keen to return his commission. If the subject has to repay the agent's portion too, will the writer pay a share of that?

Another issue is allocating payment of expenses such as the writer's travel cost to meet with the subject or the cost of transcripts of interviews and research. Are they to be borne “off the top?” Are certain categories to be borne entirely by one party or the other?

Delivery Schedule

A collaboration agreement should have a schedule for delivery of the writer's work that not only ensures compliance with delivery dates in the publishing agreement but also gives the subject adequate time to review, make comments and review revisions. The subject may want to see chapters as they are finished, preferably on a schedule, rather than reading the manuscript for the first time in its entirety. The agreement also should provide that the writer will make himself available to make timely revisions requested by the subject or the publisher, with time allowed for further review of new drafts by the subject prior to resubmission.

Beyond a writing schedule, it is wise to create a procedure for the subject to meet with the writer and convey his or her story. Celebrity subjects often are busy people and getting meetings on their calendars requires both planning and commitment. Writers, for their part, generally wish to complete their work efficiently and quickly, especially when payment installments depend on it, or the writer has agreed to make the subject's book his first (or only) priority.

Author Credit and Ownership

The credit to be given the writer, if any, is another key point because, among other things, writing credit may have significant value. And if credit is to be given (as opposed, perhaps, to a mere mention in the acknowledgments of a ghost writer), what form will it take? The subject “with” the writer, implying subject-dominance? Or the subject “and” the writer, implying joint authorship? Or perhaps “as told to.” Relative prominence of the two credits is another issue: Same size? Smaller size for the writer? Same font and color? Will the subject or publisher get to decide those details? And will the credit appear in advertising relating to the book?

A book subject often will demand complete ownership of the copyright in the manuscript, including everything the writer writes, as well as recordings and transcripts of interviews. This generally is accomplished by a broad assignment including the copyright in the manuscript and in all drafts.

The subject may also want to own ideas discussed by the parties, even discarded ones, and for the writer to agree not to write about the subject in any publication except the book they write together, or to cooperate with anyone else who does. Given the intimacy of the relationship and a desire to control the story, the subject will be reluctant to let the writer write about their collaboration or divert unused material for independent purposes.

Termination

Termination and its consequences often are heavily negotiated. The subject generally wants the ability to bring a relationship to a prompt end if the writer does not perform or the relationship otherwise isn't working out from the subject's perspective, or if the subject simply has second thoughts. Whatever the reason, the subject almost always insists on ownership of the writer's work as well as the fruits of their joint efforts-including notes, memos and written materials ' which must be turned over to the subject. In turn, the writer generally wants some assurance that if his or her services are terminated, but his work is used (and, perhaps, even if it is not), the writer will be compensated.

Termination provisions usually contemplate an early parting of the ways in three scenarios and there are variations in how each of those scenarios is worked out.

The first scenario relates to the writer's breach of duties including, for example, the failure to deliver the manuscript to the subject in a timely manner. The subject will want the right to terminate on notice without further obligation to the writer while retaining the right to exercise whatever rights he or she wishes in writings and ideas generated before then. In addition, the subject also will want to reserve contractual remedies, which may include seeking repayment of monies the writer has been paid to date. The writer may seek a meaningful portion of earnings to which he or she would have been entitled had the writer's services not been terminated if his or her writing is used, as would often be the case in the other two scenarios.

The second scenario relates to the death or disability of the writer prior to completion of the book. (Theoretically, the death or disability of the subject might also be addressed, but it rarely is.) Here too, the subject will want the right to terminate the agreement in most respects while preserving his or her right to use the text and ideas created to date as the subject sees fit. But his or her payment obligations likely will not terminate entirely.

The parties might agree that the incapacitated writer or the writer's estate will be entitled to a flat fee specified in the contract; or to a variable share of the payment that would have been due to the writer, had the writer finished the book. The size of that share likely will depend on how much of the writer's text is used in the book as published compared to the entire book. Often the subject will be permitted in the collaboration agreement to determine the writer's relative contribution in the first instance and propose a new split.

The third scenario relates to termination without cause in the pure discretion of the subject. He or she might not want to finish the book, or wish to finish the book with someone other than the writer, for any reason or no reason. Again, the subject will want the ability to use the text and ideas as the subject sees fit. He or she also will want to reserve the right to do nothing further with it. Here too, a flat fee could be agreed upon, or perhaps the same permutations applicable in the second scenario to the writer's death or disability could apply.

In each scenario, if the incapacitated writer or the writer's estate objects to how the subject treats the writer, a collaboration agreement might then require a good faith negotiation. And if that doesn't work, the contract could require the parties to submit to alternative dispute resolution rather than litigation.

Jeanine Pirro's collaboration agreement included a rare escape mechanism for the writer should she “come to the opinion” that Pirro was “not ' cooperating.” If the writer gave “reasonable written notice of the circumstances and her calculation of what delay in delivery is likely to ensue absent [Pirro's] activity,” the parties were to “mutually agree on a schedule for completion” in consultation with the publisher. And if the writer still felt “she cannot complete the work by fault of [Pirro],” then the writer could terminate and retain a pro-rata share of her fee “for work actually completed.”

Conclusion

Clearly, the subject and writer of a proposed book should not commence work until there is a signed agreement between them. Those who don't heed this advice might end up with a cloud on ownership of everything written singly or jointly, and no easy way to disperse it.

Michael I. Rudell, a member of our Board of Editors, and Neil J. Rosini are partners in the law firm Franklin, Weinrib, Rudell & Vassallo, based in New York City.