Shining a bright light into the dark corners of the shadow-world of literary scams, schemes, and pitfalls. Also providing advice for writers and industry news and commentary. Writer Beware is sponsored by the Science Fiction and Fantasy Writers of America, Inc.

December 30, 2016

All Romance eBooks' Sudden Closing: Many Questions, Few Answers

Posted by Victoria Strauss for Writer Beware

This post has been updated.

On Wednesday, December 28, All Romance eBooks--a romance-specific ebook distributor and publisher that also distributes general fiction and nonfiction through its OmniLit imprint--dropped a bombshell. In mass emails to customers and authors, ARe's owner, Lori James, revealed that her company was closing, and that in lieu of full payment, authors and publishers would be offered a fraction of what they were owed.

The exact why of the ARe closing remains a mystery (the emails make generic references to losses and poor financial forecasts, but provide no specifics). As to the what, here's what we know so far.

- The ARe website is going dark at midnight on December 31, 2016. Customers were given just four days to use their credits, download their purchases, and backup their libraries. Authors were given just four days to decide whether to accept ARe's offers of "settlement".

- ARe is offering just 10 cents on the dollar to authors whose books it distributed. Per the email, "We will be unable to remit Q4 2016 commissions in full and are proposing a settlement of 10 cents on the dollar (USD) for payments received through 27 December 2016."

- ARe is offering no payment at all--zip, zero--to authors whose books it published. In a different email, published authors are offered rights reversion on condition that they consider this "a negotiated settlement of your account to be 'paid in full'.

- In order to receive these settlements, ARe is requiring authors to waive their right to pursue legal redress. They must agree that "no further legal action be taken with regards to the above referenced commissions owed."

- ARe is staying open until December 31, but is offering settlement only on payments received through December 27. Romance Writers of America, in a statement on the closing, calls this four-day no-payment zone "unconscionable."

- ARe is saying nothing--publicly at least--about reimbursing 2017 advertising purchases. Just days before the closure announcement, ARe sent out an email soliciting ad buys. Many authors took advantage, or had already bought ads.

- ARe is doing all of this because, it claims, it wants to avoid filing for bankruptcy. "It is [our] sincere hope that we will be able to settle this account and avoid filing for bankruptcy, which would undoubtedly be a prolonged and costly process." Yes, it would--and it would also make ARe accountable to its creditors.

I've been contacted by a lot of ARe authors over the past couple of days. By all accounts, the company's implosion came completely out of the blue. Some authors did tell me that they'd noticed sales declines and ad price increases over the past year, but others saw their sales go up, and there were none of the classic warning signs--no late payments, no payment errors, no communications problems, no website glitches. Until Wednesday, ARe authors and customers had no reason to suspect there was anything wrong.

It looks like there is a lot of money involved. ARe claims close to 1.2 million titles across its two retail sites, and works with hundreds of publishers as well as individual authors. A few authors told me that they are owed relatively little--less than $100--but the majority of those I heard from are owed in the hundreds and thousands of dollars. For many, ARe was their largest source of sales after Amazon.

I've also heard from a publisher that used ARe to distribute its books; it told me that it is owed five figures, and is planning on making its affected authors whole out of its own pocket. A number of other publishers are reportedly planning to do the same.

It's worth remembering that editors and other staff are caught up in the implosion too. As are readers, whom ARe will not reimburse for purchases or pre-orders. Some authors and publishers are offering to honor pre-orders or purchases themselves, for readers who send them receipts.

Many of the authors who've emailed me plan on refusing ARe's settlement offer on principle--even if it means they get nothing, or risk having their ARe-published titles assigned to another publisher, as Lori James has apparently said she may do. On a private Facebook group, ARe refugees are talking, among other things, about the possibility of legal action.

So what to think about all this?

Even if we give ARe the benefit of the doubt--assume it is really in dire financial straits, and that its pennies-on-the-dollar offer is a good faith effort to provide at least some payment, rather than to stockpile cash by lowballing authors--it has handled the situation in a notably arrogant and unprofessional manner. I'm reminded of Booktrope, which also went out of business abruptly with few signs of trouble beforehand, leaving its authors high and dry--but Booktrope at least gave authors and customers a month to tie things up.

Can we give ARe the benefit of the doubt, though, considering that it's proposing to pay its published authors nothing (this, which hasn't been much noted in the general outcry, is for me one of the most disgraceful aspects of the whole affair), appears to be ignoring the issue of ad buy reimbursement, is expecting authors to waive their right to legal redress without knowing any of the reasons behind the closing, and is giving them less than a week decide whether to say yes or no? Not to mention that troubling four-day gap during which ARe will continue to sell books, but will not remit payment.

I am not saying there is dishonest intent here. We don't know that. But the lack of professionalism and care is really troubling.

----------------

The ARe author private Facebook page: P*ssed Off (former) ARe Authors

ARe authors are collecting data on money owed to authors and publishers. You can fill out a survey here. You can see results here; amounts range from less than $5 to more than $14,000.

UPDATE: SFWA members with books at ARe are urged to contact Griefcom at griefcom@sfwa org.

Other coverage of the ARe closing:

Smart Bitches, Trashy Books
The Digital Reader
Lilith Saintcrow
Mary Winter
Liana Brooks
KT Grant
Marilyn Vix

UPDATE 12/30/16: I don't know what this means, or if it means anything, but in March 2015, ARe co-owner and CFO Barbara Perfetti sued Lori James for a variety of causes, including breach of fiduciary duty and unjust enrichment, alleging that James had improperly forced her out of the company in November 2014. Among other things, Perfetti alleged that James started paying herself a salary shortly after Perfetti was locked out of the company (previously, Perfetti and James had taken distributions, but had not drawn salaries).

According to court records, James never responded to Perfetti's complaint, and the case was dismissed in August 2016 for lack of prosecution.

The complaint can be seen here. To see the full court record, click here, select All Case Records Search, and enter the plaintiff's name: Barbara Anne Ulmer.

UPDATE 1/2/17: Just days before the closure announcement, Lori James contacted multiple ARe authors with an offer to market their foreign and audio rights (another "click here if you agree" email), and was also contacting agents about representing those rights at book fairs. These really don't seem like the actions of a company on the verge of shutting down. Curiouser and curiouser.

UPDATE 1/3/17: At least some authors report receiving full refunds for 2017 ad purchases. And the story has spread beyond the writing/publishing community: the Guardian did an article today.

UPDATE 1/14/17: A class action lawsuit on behalf of writers and publishers has been filed in the Circuit Court in Pinellas County, Florida, against All Romance eBooks and its owner, Lori James, by the law firm of Byrd Campbell P.A. The press release is below; you can read the complaint here.


December 21, 2016

Questions for Vanity Publisher Austin Macauley Yield Few Answers

Posted by Victoria Strauss for Writer Beware



This post has been updated.

Over at The Writers Workshop, Harry Bingham is taking a look at UK-based vanity publisher Austin Macauley.
Are they legit? Or are they scammers?

I don’t know. I honestly have no idea. But I’ve heard some concerns raised about the firm and I think the fairest thing to do is ask the question.

If it turns out that the firm is an honourable one, seeking to do the very best for its authors, then fair play to them. I will take this post down and offer the WW as a platform for the firm to market itself. I will make it absolutely clear that we have no bad word to say about them, in public or in private.

And if they’re scammers – well, then, I hope they perish. I hope they perish soon. And I hope that those responsible for the company are deeply injured, financially and reputationally, by that collapse.
To try and solve this conundrum, Harry has formulated a list of questions that he has invited AM to answer.

Now, not to steal AM's thunder, but Writer Beware has gotten a lot of reports, complaints, and questions about AM over the years, and we've gathered a good deal of information and documentation. I thought it might be illuminating to share some of that, using a few of Harry's questions as a template. (Note that I'm not attempting to speak for AM, nor am I accusing them of doing anything illegal; I'm just sharing data that I've collected.)

Question 1: What proportion of AM’s titles are ‘traditional mainstream’ and what proportion are via ‘partnership agreement’?

This is an important question. AM does reveal on its website that it offers "contributory" contracts (using the newly trendy euphemism, "hybrid," to describe its publishing model), but it also presents itself as an "innovative independent trade publisher" and states that "we look at every new manuscript with a view to offering a traditional mainstream publishing deal." This certainly encourages authors to believe that they have a good chance of a traditional offer.

But do they? Writer Beware has heard from just four authors who were offered contracts they didn't have to pay for. By contrast, we've gotten 60+ reports from authors who received fee-based offers (along with lots and lots of inquiries about AM's reputation and business practices; it's one of the publishers we receive the most questions about). Now, I'm sure that the writers who've contacted me represent only a fraction of those who've submitted to AM. Even so, the proportion of fee offers to no-fee offers does suggest--to me, at least--that the bulk of AM's business is pay-to-play.

You can see many many many many many many other author reports of Austin Macauley's fees online.

Question 3: What is the median cost to the author of these partnership agreements?

Fees in contracts Writer Beware has seen range from £1,275 to £7,700 (the heading of fee disclosure section is "Advances," except that this is an "advance" the author has to pay the publisher). Some authors are offered a choice of fees depending on which book formats they pick.

Speaking of AM's contracts, I've seen a number, both "contributory" and not. In my (non-legal; I'm not a lawyer) opinion, they are substandard. There's no stated term for the grant of rights, and discontinuance of publication is "entirely at the discretion of the publisher." In effect, this is a life-of-copyright grant, with completely inadequate provisions for rights reversion. (I've written before about the vital importance of having a good rights reversion clause in a life-of-copyright contract.)

I've also seen a number of AM's acceptance letters. There are differences depending on the rationale for offering "contributory" contracts (new author, can't take the risk; previously published author, not successful enough) but other than that it's clearly cut-and-paste, with whole passages used verbatim in multiple letters.

Question 4: Partnership implies some joint sharing of risks and rewards. So, do you contribute a sum broadly equivalent to that contributed by your authors? If, for example, your launch costs for a book are expected to be £6,000, do you ask the author for £3,000 and contribute the other support yourselves? And if not, then, please, how does it work?

Obviously, I can't answer for Austin Macauley, nor would I attempt to do so. Speaking generally, however, many pay-to-play publishers promise or imply that they are contributing part or most of the expense, and the author fee is just a portion--but in fact, what authors pay is far more likely to cover not just the whole cost of publication, but the publisher's overhead and profit as well.

Also, since fee-based publishers' profit typically comes primarily from author fees and book purchases, rather than from book sales to the public, most have little reason to invest in professional-quality editing, marketing, and distribution. In fact, they have substantial incentive to skimp on these things, since they reduce profit.

-----------

AM has responded to Harry (sort of) in an email that can be seen at the bottom of Harry's post, and also in a post on its own blog. Neither response comes close to addressing Harry's questions. Here's AM explaining why. (UPDATE: AM has objected to Harry reproducing its email verbatim, so what appears now is a paraphrased version.)
We would like to be as transparent as possible in answering your questions. However, as I am sure you understand, many of the details you ask for could potentially require us to break confidentiality, in terms of both our business and of our authors. We plan to discuss these issues fully with Austin Macauley’s lawyers, who will tell us precisely how much information we are able to divulge to you.
Color me unimpressed. I can kinda sorta maybe understand that AM might not want to spotlight particular authors (though if their books are bestsellers, I doubt they'd mind)--but there's no confidentiality attached to most of the information Harry is asking for. Other publishers have no problem providing public information about sales and revenue.

Harry isn't impressed, either. He sums up his opinion in a followup blog post, concluding: "I think [Austin Macauley] is a vanity publisher that trades on the legitimate hopes and excusable ignorance of its clients...if you’re considering entering into a partnership agreement with Austin Macauley, then don’t. Just don’t."

I agree.

------------

A few more observations:
  • Coming to America! AM is UK-based, but it's ramping up its efforts in the USA. Per its website, it is opening an office in New York City--a virtual office, that is, at 40 Wall Street. (Am I alone in finding it hilarious that this is a Trump building?) Just 73 AM books are listed on Amazon US for 2015; for 2016, the number (so far) is 500. 
  • The morning after I did the research for this blog post, I clicked into a couple of news sources I like, and discovered, yet again, the power of tracking cookies.


UPDATE 12/22/16: Harry Bingham's two posts have resulted in a demand by Austin Macauley's solicitors that he remove all mention of them from his website. He is not backing down. "In our view, the instant resort to threat is a classic telltale sign of firms whose business practices fall on the wrong side of the ethical tracks."

Author and writing teacher Jurgen Wolff also received threats of legal action as a consequence of posting information about Austin Macauley.

December 13, 2016

Torquere Press Is Closing

Posted by Victoria Strauss for Writer Beware


This post has been updated.

Troubled publisher Torquere Press is closing. Owners Kristi Boulware and Joanna Talbot announced their decision yesterday in an email that will doubtless infuriate many authors, but probably won't surprise them:
We have thought long and hard about where things are with Torquere and made the very hard decision that we need to begin the process of closing this chapter of our lives....We have done everything we could to turn things around but with the saturation in the industry, the financial hardships we are in, my health in constant decline along with the negativity we have had hurdled our way. We feel like we are currently fighting an uphill battle.
Trouble at Torquere (which had been in business since 2003 with no problems) surfaced in early 2016, a little more than a year after Boulware and Talbot took it over. Reports of royalty payment problems began to proliferate, even as Torquere participated in Twitter pitch contests to find new manuscripts. During the summer, Boulware was arrested on a hot check charge, allegedly after payment to one author bounced. (UPDATE: the charge was dismissed on December 13 after Boulware posted a cash bond of $10,150.50.) In November, communication stopped completely, with neither Boulware nor Talbot answering authors' emails or responding to Facebook messages. Ominously, both co-owners removed "Torquere" from their Twitter handles and bios.

Now the other shoe has dropped. According to the email, which was sent to all Torquere authors, writers will receive rights reversions, a process Boulware anticipates will take at least 90 days. As for when (or whether) they'll get the royalties they're owed...well, on that issue Boulware is vague. "We are still looking at options on how to get everyone paid," she says. Hmmm.

The rights reversions will revert rights only to authors' originally-submitted text. "You will not be allowed to keep your cover art, ISBNs, or final edited versions of the books." Obviously ISBNs can't be re-used, and most publishers keep copyright to cover art (which they furnish at their cost)--but claiming copyright on edits is not the norm. Unfortunately, it's something I'm seeing more and more of in small press contracts--even though it's a pointless (how does the publisher benefit by keeping a death-grip on editorial revisions?), burdensome (since the author must re-edit an already-edited work), predatory (since revisions are typically done by authors themselves at editors' suggestion), and likely not even legally defensible practice. I consider it a contract red flag.

Is the copyright claim on editing even in the Torquere contract? I've heard of publishers that have made this claim on reversion, despite no contract clause allowing them to do so. Looking back through my files, I see that I've never actually seen a Torquere contract. Anyone want to share? I'd be interested to know if that language is in there.

Torquere authors, please let me know if you are receiving reversions--and if you are getting paid. All information shared with Writer Beware is held in confidence.

I'll update this post with any new information.

UPDATE 12/15/16: I've now seen several Torquere contracts, which do not include any copyright claim on edits.

I've also been informed by several authors that Kristi Boulware has offered some clarification on what's meant by "final edited versions of the books." Responding to questions in Torquere's Yahoo group, she confirmed that this doesn't mean the text, but rather the formatting--in other words, Torquere is not claiming copyright on edits, just the final formatting of the book. I don't know why this wasn't made clearer in the "we're closing" email, but there you go.

UPDATE 12/18/16: Per documentation that I've seen, Boulware is not claiming copyright on the final edited text of published books whose rights she is reverting. She is, however, forbidding writers to use edited text if their reverted books haven't yet been published.
If your book is NOT released and you have received edits from your editor. [sic] Then you are expected to not use those edits. We are being billed for edits on manuscripts under contract and those edits should not be taken elsewhere when that contract was voided since it was never finalized with Torquere.

December 9, 2016

Trouble at Tate: Could it be End of Days for America's Most Prolific Vanity Publisher?

Posted by Victoria Strauss for Writer Beware

Since putting this post online, I've received dozens of questions about whether there's a class action lawsuit against Tate. To my knowledge, the answer currently is no. I don't think that's the best option, anyway, because given all the complaints by authors and staff of non-payment, I'm guessing that Tate has few resources to tap for reparations.

Instead, I'd strongly encourage authors to file complaints with the Oklahoma Attorney General's Office and with the FBI. Individual complaints don't usually spur action, but a volume of them may, especially if they are received over a short period of time. The Oklahoma AG has already received a lot of complaints about Tate.

File a complaint with the Consumer Protection Division of the Oklahoma Attorney General's Office

Contact the FBI field office in Oklahoma City

This is a developing situation; see the updates at the bottom of this post.

It's hard times lately for "America's Top Publisher," a.k.a. Tate Publishing & Enterprises, a.k.a. one of America's most prolific vanity publishers.

Tate has been on Writer Beware's Thumbs Down Publishers List since the list was created. Not just because it charges enormous fees (an initial $3,990, with the option of paying hundreds or even thousands more for extras such as video trailers, custom websites, self-ordered books, and the like), but because it presents itself as a "mainline publishing organization" and doesn't reveal its fees anywhere on its website or in its promotional videos.

In fact, Tate's website specifically promises that authors do not have to pay to publish: "Tate Publishing does not charge a fee for publishing and absorbs all the cost of production and distribution of a book." But this is classic vanity publisher doublespeak. Deeper into the submission process, when Tate finally gets around to asking authors to pull out their credit cards, they are told that the money is for a publicist.

Clearly, Tate wants authors to assume that it's as traditional as traditional can be. And they do. Writer Beware has gotten hundreds of questions and reports from authors who approached Tate in the belief that it was not a vanity publisher.

We've also heard from many Tate authors who don't feel their money was well spent--and we aren't alone. In 2015, Tate was the second most complained-about company to the Oklahoma attorney general. Many more complaints--not just about Tate Publishing, but about its vanity recording subsidiary, Tate Music Group--can be found online. They make for terrifying reading--bad editing, shoddy production, constant staff turnover, books ordered and paid for but never received, delayed pub dates, non-payment of royalties, "marketing" that mostly consists of urging writers to buy their own books...the list goes on

The Better Business Bureau, which as of this writing has logged 134 complaints over the past three years, yanked Tate's accreditation earlier this year.

That's a lot of chickens, and they are now coming home to roost. This past May, Xerox Corporation filed a $1.7 million lawsuit (since increased to $1.89 million) against Tate, alleging defaults on service agreements and promissory note payments, and seeking re-possession of $450,000 in leased equipment. Tate has not had good luck with its attorneys in the case; the first withdrew in September, saying he was retiring, and the second is also seeking to withdraw, in part, apparently, because Tate hasn't paid him. (Maybe that's why Ryan Tate never got around to filing his promised counter-suit against Xerox.)

The Xerox lawsuit spurred layoffs from Tate's printing plant, even before Xerox began re-possessing its equipment in late July. And that's not all. Tate is facing at least four additional legal actions: a lawsuit by an author who claims that she paid over $12,000 for a book that was published full of errors (twice); a petition by a musician suing over copyright laws (a customer of Tate Music Group, which also runs on a vanity model); a claim by memorabilia manufacturer Jostens, which alleges that Tate owes it more than $13,000; and another by the property company that leases Tate its print shop (vacant now that Xerox has re-possessed its equipment), which alleges that Tate owes nearly $20,000 in rent.

If that weren't enough, Tate's employment practices are being investigated by the Department of Labor. (Some employees say that they were threatened and "coached on what to say" by CEO Ryan Tate before Labor Department investigators came to interview them; this would not be the first time that Ryan Tate has threatened employees.) And per an (uneverified) comment on one of my previous posts about Tate, Tate may recently have been evicted from its offices.

Are these the straws that broke the camel's back? Has Tate reached its very own End Times? Either way, it's not looking good for "America's Top [Vanity] Publisher."

Predictably, the honchos at Tate are pretending nothing's wrong. “There are a lot of issues that probably would be a little more important for you or your news agency or any news agency to deal with," company founder Richard Tate told local news station KFOR, "other than the fact that our company is doing a great job.”

Hmmm. I think some Tate authors would disagree.

Watch this space.

UPDATE 12/22/16: I'm getting a flood of emails and comments not just from Tate authors, but from Tate staffers in the Philippines (you can see some of the comments below). Here's what I'm hearing.

- Apparently Tate's Philippine workforce once numbered close to 1,000, but massive dismissals have seriously reduced this. The consensus seems to be that around 80% of staff have lost their jobs since October.
- Unpaid or part-paid salaries and bonuses; apparently corporate headquarters in the USA hasn't been wiring enough money to cover payroll.
- Staff complaints filed with the local Labor Department, citing salary disputes and dismissals without the required 30-day notice.
- Production halts and slowdowns have put books in limbo, since there's no longer sufficient staff to work on them.
- Resignation of high-level corporate staff in the US.
- Silence on these issues from corporate headquarters.

The Philippine staffers I've heard from are convinced that Tate can't survive much longer. Several have told me that they suspect that the Tates are shifting assets to a new company called Lux Creative Concepts LLC, which was registered in February 2016 by Ryan Tate's wife, Christy Kelley-Tate.

Stay tuned.

UPDATE 1/10/17: From the comments on one of my previous posts about Tate, today--I stress that this is unconfirmed. [UPDATE:: at least one Tate author has received an email from Tate's marketing department confirming the closure]

"Tate Publishing has officially shut down their business in the Philippines today. Their main office in Cebu has been locked up by the Department of Labor and the owner of the building due to non-payment of the rent."

UPDATE 1/11/17: And another:

"I'm an ex-employee of Tate, and we were just at the Cebu office yesterday. Today is the the last day that the office is open, mainly for HR to furnish ex-employees with certificates of employment and other documents. The Department of Labor has officially ceased all operations and is taking stock of the company's physical assets.

We have been informed that, as of this writing, there is no official directive or announcement from the Tates that the company is closing or declaring bankruptcy."

UPDATE 1/12/17: More on the Philippines debacle from an Oklahoma-based blog that has published a lot of articles about Tate's shenanigans. A former Tate staffer in Tate's now-closed Cebu offices describes partial payment of salaries, non-payment of government-mandated bonuses, and other problems dating back months.

I've received many similar emails from Cebu staffers, one of whom shared with me the Department of Labor notice resulting from a compliance visit to Tate's Cebu offices on January 9. Findings:


UPDATE 1/14/17: Some Tate authors report receiving an email signed by Tate's Director of Production, Tim Kelley, claiming that Ryan Tate hasn't paid employees and "your book will never be finished." This email was reportedly followed, within a couple of days, by another email claiming that the first email was the result of "identity theft" and its allegations aren't true.

Okay.

Meanwhile, Tate authors are receiving this, also--apparently--from Tim Kelley:


Things are fine, folks, just fine. Never mind the mass layoffs of employees. Never mind the lack of payment and non-communication. It's all just a transition.

I'd love to hear from Tate authors who sign up for the portal. Have you received any results from your "new support ticket"?

UPDATE 1/16/17: There's now a forum for Tate authors to share experiences and support: Tate Publishing Help.

December 1, 2016

Small Press Storm Warnings: Torquere Press, Caliburn Press, Month9Books

Posted by Victoria Strauss for Writer Beware


This post has been updated.

A roundup of publishers about which I've recently received serious complaints (all of them documented).

TORQUERE PRESS

At the end of 2014, the founders of Torquere Press--a well-regarded small publisher established in 2003--turned the company over to new co-owners: Kristi Boulware and Joanna Talbot.

Before the change in leadership, Torquere had been trouble-free (or at least, not generating author complaints). It didn't take long for that to change. In early 2016, a little more than a year after the new owners took over, reports began surfacing of royalty payment problems. More reports showed up over the summer, even as Torquere participated in Twitter pitch contests to find new manuscripts. Also during the summer, Kristi Boulware was arrested on a hot check charge, allegedly after payment to one author bounced(UPDATE: the charge was dismissed on December 13 after Boulware posted a cash bond of $10,150.50.)

In an early September email to authors, Boulware admitted that Torquere was suffering "financial setbacks since losing several of our top-selling authors." Funds were "the lowest they've ever been" and the company was "trying to obtain some business funding to assist with meeting all of TP’s financial obligations." As of late September, things hadn't gotten better...but, per an update posted in the Torquere authors' Yahoo group, "We are staying positive and will be sending out at least partial payments as we are able to."

Those payments never showed up, according to multiple complaints received by Writer Beware (allegedly, Torquere owes one author more than $18,000). In November, communication stopped completely, with neither Boulware nor Talbot answering emails or responding to Facebook messages from authors asking about money owed or seeking rights reversions (Torquere apparently has responded to some reversion requests, but ignoring others). Both co-owners also have removed "Torquere" from their Twitter handles and bios. No matter how you look at it, that's not a good sign.

Meanwhile, Torquere remains open for submissions, with active anthology submission calls. Given the serious and apparently escalating problems at Torquere, I'd advise authors to stay away.

UPDATE 12/13/16: Torquere is closing. They promise rights reversions but are vague on when (or if) writers and staff will be paid. Details in my followup blog post.

CALIBURN PRESS

Caliburn Press consists of seven imprints. Only three appear to have actually published any books--including Damnation Books and Eternal Press, which Alan Leddon, then of Spero Publishing, acquired from former owner Kim Richards Gilchrist in 2015. Leddon then consolidated Damnation and Eternal with his other imprints under the Caliburn name.

Damnation/Eternal was a problem company. Writer Beware received many complaints about its lack of professionalism, with authors citing poor editing, minimal marketing, uncompetitive pricing, and, late in Gilchrist's ownership of the company, missing royalty statements and payments. Damnation's contract paid royalties on net profit, and imposed huge early termination fees--both red flags that I've warned about repeatedly on this blog.

I posted a warning about Damnation in 2013 after one author sued the company for inserting hundreds of errors into her published book and refusing to publish a corrected version. Here's another author who had to take legal action. And the Damnation Books thread at Absolute Write is loaded with complaints.

(Gilchrist couldn't be faulted for ambition. In 2010, with much fanfare, she and her husband took over long-running speculative fiction magazine Realms of Fantasy. In less than a year, they drove it into the ground,)

When Gilchrist unloaded Damnation/Eternal in September 2015, authors were hopeful that Alan Leddon would make a good-faith effort to fix the problems. Unfortunately, the situation only seem to have gotten worse. In early 2016, Writer Beware started getting familiar-sounding complaints of non-payment--not just from authors this time, but from staff. Other complaints included repeatedly-delayed publication dates, bad editing, high staff turnover, poor financial management (in an April email to authors, Leddon denied embezzling funds, but admitted that "some money is missing from business accounts"). To authors' fury, Leddon also attempted to expand the net profit royalty calculation in Damnation/Eternal contracts to enable him to deduct not just printing costs, but also cover art, ISBNs, copyright registration, and a raft of other expenses.

In April (the same month Leddon felt he had to deny embezzling company money), gobsmacked Caliburn authors got a solicitation to contribute a GoFundMe campaign set up by Leddon, through which he hoped to establish a brick-and-mortar "spiritual bookstore" where, among other items, their books would be sold. In a maybe-too-candid description of the campaign, Leddon revealed that he was "living on government benefits and an occasional few dollars from the publishing company that I started five years ago" and admitted to "years of my publishing company making less per quarter than the cost of a tank of gas". Not very reassuring for all the authors who had hoped their new boss had the resources and expertise to turn things around.

As of this writing, complaints continue to come in. Caliburn Press is still open to submissions. Writer beware.

MONTH9BOOKS


Last July, I wrote a long post on the troubles at Month9Books, which had just scaled back its author list amid multiple complaints of lack of payment (for staff as well as authors), delayed publication dates, broken marketing promises, overcrowded publication schedules, communications breakdowns, problems with royalty accounting, and alleged harsh treatment and/or bullying by Month9 owner Georgia McBride.

McBride pledged to work on the problems and make Month9 great again (sorry, couldn't resist). Unfortunately, Writer Beware is still hearing from authors who say they haven't been paid, haven't received royalty statements (or have received strange or incorrect ones), and have been on the receiving end of angry responses from McBride.

Two Month9 authors have filed suit against the company, alleging nonpayment and seeking return of the rights to their books.

Despite these issues, and the fact that overstuffing its publication list was a major source of its troubles, Month9 continues to acquire titles. Writer beware, again.

July 19, 2016

WriteIndia Writing Contest: When a Contest Sponsor Changes The Rules

Posted by Victoria Strauss for Writer Beware

NOTE: This post has been updated.

I harp a lot here on how important it is to read the fine print--in your publishing contract, on websites that host user content, in literary contests. Sure, it's tedious, especially if couched in lengthy legalese--but skipping this step can result in unpleasant surprises.

What happens, though, if the contest sponsor changes its guidelines while the contest is still in progress?

Last year, the Times of India--one of the world's largest English-language newspapers--launched the WriteIndia contest. Each month for eleven months, a well-known Indian writer provided a passage or a prompt for contest entrants to develop into a short story. Eleven winners were awarded a Kindle, attendance at an exclusive writing camp, and publication in a compilation of winners' stories published by TOI's publishing imprint, Times Group Books.

Major newspaper, eminent writers, publication--what's not to like? Thousands of writers entered the contest. The final slate of winners was announced July 15 on Twitter, prompting this question from one of the non-winning entrants:
To which the response was:
Wait, what? shocked writers demanded. How could that be?

When I put this post online earlier today, here's how the next few paragraphs read.
Well, because of the fine print of WriteIndia's Terms & Conditions:
7. OTHER TERMS AND CONDITIONS:

a. Participant acknowledge and agrees that [Times Internet Limited] shall have irrevocable, worldwide, exclusive right to publish and commercially exploit the story/content submitted with TIL, through any medium and channel for the period of two years from the date of completion of campaign. After two years exclusivity period, TIL shall have non- exclusive right to publish and commercially exploit the story, worldwide and in perpetuity. TIL shall have the right to adapt, edit or modify the story as solely determined by TIL. TIL shall not be required to take any further approval or to notify the participant or to pay any additional consideration for the grant of aforesaid rights.
Simply by entering the contest, writers granted TOI perpetual rights to their stories, whether or not they won--and not just nonexclusively, but on an exclusive basis for a full two years. TOI doesn't have to pay writers whose work they use, or even notify them.

I've rarely seen such a greedy rights grab in contest guidelines. If anyone had contacted me to ask about this contest, I would have advised them not to enter. On the other hand, TOI didn't attempt to hide or obfuscate the rights grab--it was right there in black and white for anyone to read. Problem is, lots of writers apparently didn't read it. So now, basically, they're stuck.
In fact, the above is not quite correct, as I discovered late this afternoon when I checked into what's claimed in the first comment on this post. When most writers entered the WriteIndia contest, the T&C were different from what they are today. Here's a screenshot from April 19 of this year, courtesy of the Internet Archive.


As you can see, the rights grab is still there (the last sentence in the shot), but in vague language that's much easier to miss or misinterpret, especially since there's no mention of irrevocability, perpetuity, or exclusivity. As the contest was coming to an end, TOI must have decided it needed something more precise, so it completely re-wrote the T&C--which it was within its rights to do because of this paragraph:
The Times of India reserves the right at any time without prior notice to add, alter, modify, all or any of these terms and conditions or replace, wholly or in part, this Offer by any other Offer, whether similar to this Offer or not or to withdraw it altogether.
It's not unusual to find such language in contest guidelines, but it's rare for a contest sponsor to make such wholesale changes while the contest is in progress. While writers who ignore or miss plain language in a contest T&C have only themselves to blame, and the mention of "commercialisation" in TOI's original T&C should have been a red flag, it seems to me that WriteIndia entrants were substantially misled by rights language that TOI's own alterations of its T&C acknowledge weren't nearly clear or comprehensive enough, and didn't adequately convey its intentions for the entries. In my opinion, this is pretty shameful.

TOI has attempted to allay one concern--that the stories might be published without writers' names:


Sounds good, but I have to point out that since neither the original nor the revised T&Cs mention the issue of moral rights at all, writers have no recourse if this pledge isn't honored.

In response to the flap, TOI's Director, Vinita Nawra Nangia, is now saying that "anyone who does not agree to the said terms and conditions, is free to withdraw from the campaign." (Contact info: writeindia@timesinternet.in.) TOI should go farther. It should formally relinquish any and all rights to any and all non-winning entries.

July 15, 2016

How Publishers Abuse Termination Fees: Sky Warrior Books

Posted by Victoria Strauss for Writer Beware


I've written before about termination fees in publishing contracts: why they are bad not just for authors, but for publishers, and how publishers can abuse them. Here's another case study in how termination fees can become a tool for retaliation.

Sky Warrior Books, "a press dedicated to publishing quality SFF, mystery, historical fiction, paranormal, nonfiction, and other genres", is run by publisher and author Maggie Bonham (who also writes as MH Bonham and Margaret H. Bonham). Among the lesser-known authors on its list, there are several books and anthologies written/edited by established SF/fantasy authors.

Sky Warrior's contract--which is problematic in a number of respects, including vagueness in the royalty language--has not one, but two early termination fee provisions:
12.a.ii.: Prior to publication, the Author may terminate this contract for unspecified reasons by reimbursing the Publisher for costs incurred, plus a termination fee of $500. Examples of costs incurred include expenses such as editorial and cover art.

12.f.ii.: Post Publication: In the event that the Author is terminating the agreement in order to sell the Work to another publisher, individual or company for publication, the Author shall pay a termination fee of 10% of the advance and royalties earned on the Work to the Publisher, plus purchase all remaining inventory at cost +15%, with no royalties paid on copies purchased under this clause.
Sky Warrior also appears to have issues with timely royalty accounting. Complaints can be seen at the Absolute Write Water Cooler and at Ripoff Report; I've gotten some as well. Two of the authors who contacted me challenged the lack of payment and pressed for answers, whereupon Maggie Bonham terminated their contracts and reverted their rights, without asking for money. A third author--the one who's the subject of this blog post--also got her rights back. From her, however, Bonham demanded termination fees.

The author--who has asked that I don't use her name, so I'll call her Eve--signed a four-book contract with Sky Warrior in early 2013. Book 1 was issued in late 2013. Sky Warrior has two royalty periods--January-June and July-December--with the publisher required to make "all efforts" to issue payment within 120 days of the period's close. But it wasn't until September 2014, nearly nine months after the close of the July-December 2013 royalty period, that Eve even got a royalty statement for her 2013 sales. As for payment, Bonham indicated, without explanation, that she wouldn't be doing that until December 31. (Here's where the vague royalty language I mentioned comes back to bite: if a publisher isn't contractually required to pay within a stated timeframe, but only obliged to make "all efforts" to do so, it can argue "circumstances beyond our control" and do pretty much whatever it wants.)

Meanwhile, Book 2 had been published in early 2014. Eve says she wasn't given notice of the pub date until 24 hours prior, and never saw page proofs, despite the stipulation in her contract that she be able to review and approve them (according to Eve, the book included many errors). Royalty statements and payment for Book 2, due by the end of October 2014, didn't materialize--nor did royalty statements and payment for the same period for Book 1.

By December 2014, Eve was fed up. She hired a lawyer and demanded contract termination and rights reversion for all four books, citing multiple breaches of contract. In response, Bonham categorically denied breach, and defended the absence of royalty payments by claiming that, because vendors take up to six months to pay, the contract's 120-day royalty payment window actually began to run six months after the end of a royalty period (even though there is no wording whatsoever in Eve's contract to support this). She admitted she didn't make even that extended deadline for Eve's 2013 royalties. It wasn't her fault, though: it was due to--wait for it--"circumstances beyond our control".

On the up side, Bonham did agree to revert Eve's rights--but on the down side, not for free. For Books 1 and 2, she invoked Clause 12.b.ii., levying a fee of $56.13, which she claimed was 10% of royalties for the first half of 2014 (an additional 10% of royalties for the second half of 2014 would be due "when calculated"). For Books 2 and 3, which hadn't yet been published, she invoked Clause12.a.ii: $500 for each book, plus $317 for assorted costs including editing. The total of $1,373.13 was due within 60 days; any royalties accrued and owing would be applied to this "outstanding balance." As the cherry on top, Bonham warned Eve that "any libelous or slanderous statements by her, her family members, or her associates" would result in legal action.

In my opinion, it's debatable whether Bonham was entitled to invoke the termination clauses, since Eve wasn't seeking to terminate the contract for "unspecified reasons" (she cited specific breaches) or "in order to sell the Work to another publisher, individual or company for publication" (she had no competing offer; she just wanted out). Be that as it may, for Bonham this is a win, whichever way it goes. She gets rid of a pro-active author, and if Eve pays up, she also gets some extra cash. If Eve refuses, Bonham gets to hold onto royalties she otherwise would have been on the hook for paying (in Eve's case these amount to several hundred dollars).

As it happens, Eve is an active member of the Science Fiction and Fantasy Writers of America. She turned the matter over to SFWA's Grievance Committee, which has a good record of mediating disputes between authors and publishers. Bonham, however, refused to cooperate, doubling down on her denial of wrongdoing and reiterating her her demand for money. She also accused SFWA and Writer Beware of a dastardly conspiracy:
After all, if we are harmed, you will have participated in the further erosion of independent, small presses, and I can't believe the rumor that SFWA and Writer Beware are cooperating with the Big Five publishing houses' efforts to destroy the independents once and for all. Although I did find it curious that Writer Beware's publisher avoid list is populated exclusively with small presses, often based in rural areas, far from the New York in-crowd.
Damn. And we thought we were being so discreet.

Seriously, though, I think Eve's experience illustrates how publishers can use termination fee clauses to retaliate against authors who displease them. The other authors I heard from who complained about nonpayment had their rights reverted without any demand for money. It's hard not to conclude that Eve was being punished for having the temerity to hire legal assistance.

The other takeaway here is the importance of taking contract language seriously. No matter how good a publishing relationship looks at the start, things don't always go on as they begin. Never assume that provisions in your contract won't at some point apply to you--no matter how unlikely that seems--or that your publisher, who right now seems so responsive and enthusiastic, won't invoke onerous clauses if things go south. To quote author and editor Jane Friedman, contracts aren’t there for when times are good and everyone is well-intentioned--they need to work for you when things go to hell. (For more on the danger of making assumptions, see my 2014 blog post, Evaluating Publishing Contracts: Six Ways You May Be Sabotaging Yourself.)

Bonham is now threatening to turn Eve's "debt" over to a debt collector.

July 8, 2016

"Cutting Lists Isn't New": Q&A With Month9Books Founder Georgia McBride

Posted by Victoria Strauss for Writer Beware


Last week, as I was researching my blog post on the troubles at YA publisher Month9Books (which recently reverted rights to 40-50 authors amid allegations of non-payment and other problems), I reached out to owner Georgia McBride with some questions. Her responses are below. (You can also read McBride's interview with YA Interrobang, which published a long article on author and staff allegations.)

--------------------------

VICTORIA STRAUSS: Your email to authors [about the rights reversions] mentions that you fired an accountant who created problems for Month9, including missing and incorrect payments. Can you tell me more about what happened, and what steps you're taking to address the problems and ensure that staff and authors receive payments due them?

GEORGIA MCBRIDE: I can't say more than I have already said about the accountant, and really, I prefer not to focus on him. What I can tell you is that I am working to get everyone caught up and paid in full who is owed a payment. From the many books ​we've published, there are only about 7 or so outstanding payments actually due at this time. We've managed to get mostly everyone paid since the author email was sent.

VS: Communications I've received from both authors and staff indicate that payment problems go back at least to 2013. I've heard from staff who say they were never paid at all. Can you comment?

​GM: I can't comment on what you've heard, since I am not privy to it. ​I'm also not aware of any freelancers who have never received payment for satisfactory work. There are however, several freelancers who delivered work extremely late or work that was not up to the standard and had to be redone by someone else in order to meet that standard who have not and will not be paid.

When we first started, I paid on a "commission" type basis where the freelancers income was tied to the book's performance. It was a good idea to motivate and encourage people, but I later realized that sometimes a book simply does not sell. And, even if it does, after distribution, printing, marketing, etc., there is little left to pay the editor. So, for those people, who may have worked on projects for little to no payments through 2014, I paid them all--even though I did not have to. Even though they signed contracts stating they would get paid only after the author is paid. In some cases it took almost 2 years to pay them all--but it was important to me to do it, even though I did not have to. Of course, no one is talking about that.

VS: Initially Month9 planned a small publishing list--8-12 books a year is what I've been told--but both acquisitions and the release schedule seems to have very quickly increased far beyond that, and in your Q&A with YA Interrobang you acknowledge that an overcrowded publishing schedule was the source of some of the problems authors are reporting. Why did Month9 ramp up its publishing schedule so quickly, and in hindsight, would you do anything differently?

​GM: A publisher needs content to grow. It baffles my mind how anyone who understands the business and what it takes to launch a publishing company could question this. ​I have said many times that a good publisher not only has awesome books. But a good publisher must have reliable and qualified staff and a solid business foundation that includes accounting and legal counsel. At various points in our short life, Month9Books struggled in all those areas.

Acquiring books and publishing them is not just about the cover. If the compliance isn't there, or there is a lot of turnover in staffing, and or the accounting is lacking; you are going to have a BIG problem. This is where we faulted. And, because I have a habit of not wanting to micromanage, I got into a situation where we simply had too many titles to manage with the resources we had. The right thing to do was to put the brakes on, make some hard decisions regarding which books to release and take steps to solidify the business foundation before moving forward.

Cutting lists isn't new. I didn't invent it. In fact, we do it annually in October. Anyone who has been through it with us can tell you. That said, when my blood clot happened (I had been having bouts of Vertigo earlier in the year), I knew it was way past time to bite the bullet and do what had to be done. Not only were we understaffed in the areas that mattered the most, but now, I was not going to be able to work as much as I had. It would have been unfair and very selfish of me to try to keep all the books. Believe me, I wanted to. I wanted to because I hated disappointing the authors. I was sick to my stomach for weeks because of what I was about to do. But the thing that got me through it was knowing it was ultimately the best for everyone involved, even if it hurt like hell while going through it.

VS: I know this is a tough question, but...many of the authors who've contacted me describe an atmosphere of intimidation at Month9, and have told me they fear reprisals for going public. Does this concern you, and do you have plans for addressing this perception going forward?

​GM: Not at all, but then again, I can't comment on what you have heard since I have no idea what you were told. That said, I am not at all concerned about these comments since many authors naturally feel scared about saying anything derogatory about their publishers or future publishers or agents, etc. This isn't anything new. But here's the thing, I have rights too. It's my right to protect myself, my family, my staff, my authors and my partners from anything that could potentially negatively impact my business. I have every right to defend myself and my company against libel and defamation. I will continue to assert that right, no matter who it upsets.

VS: What's next for Month9Books?

​GM: You know what? We've been busy working! I have announced 4 audiobook deals in the last couple of weeks, a new reading club license with Scholastic, and we have our first China release coming in a few months! China! In the immediate future, we have an amazing slate of Fall books and are looking to publish our very first young reader series in early 2017. Thanks so much!

July 1, 2016

Month9Books Scales Back Its List Amid Allegations of Nonpayment

Posted by Victoria Strauss for Writer Beware


See bottom of post for updates.

On May 20, Publishers Lunch broke the news that Month9Books, a well-regarded and apparently successful publisher of young adult and middle-grade fiction, was scaling back its list and reverting rights to "40-50 authors across all imprints". In an email to Month9 authors sent the same day, company founder Georgia McBride cited her own health problems, along with staffing issues and the company's "substantial growing pains" over the past six to nine months.
The announcement set off a small flurry of conversations about the publication and about small presses overall, with many wondering how McBride could afford to acquire new works if authors were complaining about loyal or absent royalty payments.

McBride ignored speculation and turned her attention towards working – even as authors on Twitter began to discuss how lack of payment was a recurring problem for the company.
The quote above comes from YA Interrobang (an online magazine focusing on the YA market), in a long and detailed article by editor Nicole Brinkley published a few days after McBride's announcement. The article focuses on reports of serious problems at Month9--not just lack of payment (for staff as well as authors), but delayed pub dates, broken marketing promises, overcrowded publication schedules, communications breakdowns, problems with royalty accounting, and alleged harsh treatment and/or bullying by McBride. According to authors and staff quoted in the article--most of them anonymous--these problems are not new or even recent, but have been ongoing for a long time.

From questions sent to Writer Beware by authors considering submitting to Month9, I know that rumors of nonpayment were floating around as early as mid-2013. But apart from one nonpayment report in 2015, I didn't receive any complaints about Month9 until the mass rights reversion and the YA Interrobang article opened the floodgates. Since then, I've heard from Month9 authors and staff who've shared their experiences and provided me with documentation--amply confirming Nicole Brinkley's reporting, and also adding additional data: rapid turnover of editorial and PR staff, problems coordinating ebook and print releases, an official (and non-standard) policy of not paying or accounting royalties until the year following publication, no accounting for books entered into Kindle Unlimited, and more. (Several complaints from Month9 authors can be seen in this thread at Absolute Write, starting on Page 5.)

What I've heard from authors and staff also suggests why the troubles at Month9 haven't really come to light--publicly at least--until now. I've reported on a lot of publisher problems over the years, and it's normal for authors to feel conflicted about coming forward, or to worry about repercussions--but I've never encountered a situation where authors expressed such a level of fear and intimidation.

Nearly every author who contacted me described domineering, brusque, bullying, and even threatening behavior by McBride, and said they feared reprisals and/or damage to their careers if they revealed too much or let me use their names. They also pointed to the draconian non-disclosure agreements included in Month9 contracts, which bar authors from discussing the terms of their agreements "in person, online, verbally or in print, in public or in private except and only with officially documented legal and or agency representatives" and promise legal action if they don't comply. Even Month9's reversion letters include an NDA, requiring authors to keep reversion terms confidential for a full five years (something that could pose problems for an author seeking to re-publish her reverted book).

As one individual told me, "It’s astounding to see the difference between the public perception of this pub and the reality."

------------------------

When it started up in 2012, Month9 looked really promising. McBride had a long involvement with and many contacts within the YA publishing market, and she seemed to be making all the right moves--employing qualified editors and designers, planning a conservative publishing schedule, signing up well-known writers for Month9's debut anthology, snagging real-world distribution through Independent Publishers Group. Although some agents were wary of Month9 as a new and untried small press, others were willing to work with it on the strength of what seemed a solid start.

So how did things go wrong? In her May 20 email, McBride mentions health problems that have made it difficult for her to manage her workload (obviously, something that can happen to anyone and can't be helped if it does--but also a cautionary reminder of the risks of contracting with a publisher that's essentially a one-person operation). She also blames late contracts on Month9's legal counsel's departure "a few months ago", and "late and often erroneous payments...made to staff and some authors" on a fired accountant, who "made some pretty damaging transactions". (Some of the authors who contacted me disputed these statements, claiming that the lawyer had actually been gone for closer to a year and confirming that payment issues go back almost to Month9's inception.)

McBride also cites "substantial growing pains." And I think that's really the crux of it, because Month9 did grow--and grow. Authors who signed on in the beginning were told that the company planned to publish 8-12 books a year--a reasonable output for a new small press--but that conservative publishing schedule seems to have quickly fallen by the wayside. In 2013 Month9 released 23 books (figures based on Amazon listings), an expansion due in part to the addition of a new imprint, Swoon Romance. Another new imprint, Tantrum Books, was added in 2014, helping to balloon the list to 71 titles. 2015 saw just over 50 releases--a considerable drop, but still more than quadruple the original release plan. 2016 looks to be about the same, with 47 releases scheduled through November.

On its website, Month9 proudly confirms this rapid growth: "Since [2012], we have announced 182 book deals and published over 100 books." But if you plan for 8-12 books a year, yet almost immediately double and quadruple and even quintuple that, you are going to encounter--at a minimum--logistical problems, especially if you suffer (as multiple authors allege Month9 does or did) from high staff turnover. At which point you'll either have to try and do it all at the risk of things falling through the cracks, or cut vital services such as marketing--or, as appears to have been the case for Month9, both. You'll also have to decide how to deal with the questions and complaints that will inevitably start rolling in, especially if you are having trouble cutting checks. Will you be candid? String people along with excuses? Put the blame on troublemakers? Just stop communicating? Will you even acknowledge to yourself how bad things are?

Over-acquisition is a rock on which many small presses have run aground (one example is Permuted Press, which actually had to stop publishing for a while when its hugely inflated production schedule got out of hand). Faced with an abundance of good manuscripts, an ambitious publisher's eyes can easily outstrip its stomach. But as much as running a publisher may be a labor of love, it's also a business. You have to balance ambition and growth with sensible business practice--which means, among other things, maintaining a disciplined release schedule and making sure that your workload and your staffing are a match. More and more, it seems to me that many small presses fall apart not just because their owners lack publishing savvy and expertise, but because they simply don't know how to run a business.

----------------------

How things will go from here is anyone's guess. Both in her May 20 email and the interview that accompanies the YA Interrobang article, McBride indicates she is continuing to make acquisitions--which in the circumstances hardly seems wise--though she notes that there have been "significant changes to both our submissions and acquisitions process."

She also dismisses the negative information that has surfaced in the past few weeks as social media-fueled "personal vendettas or campaigns against me." But even if that's the case--and based on the volume of  complaints, as well as their consistency, I don't believe it is--there are, by McBride's own admission, serious problems at Month9 that need to be addressed.

I hope McBride does address them--including taking a hard look at the culture of fear authors have described. And I hope Month9 survives. But I think that's going to require more than just a change in the company's submissions and acquisitions process.

I invited McBride to comment for this article. Our Q&A can be seen here, in a separate post. (The Q&A is accumulating comments from Month9 authors and staff; those are worth reading as well.)

UPDATE, 10/16: Writer Beware is receiving new complaints from Month9 authors, citing non-payment, absent or incorrect royalty accounting, and bullying emails from Georgia McBride.

UPDATE, 11/7/16: Two Month9 authors, Abi Ketner and Missy Kalcicki, have filed a lawsuit against Georgia McBride and Month9 Books. "As alleged in the complaint, the authors’ publishing agreement has terminated due to Month9’s breach of the agreement, including Month9’s failure to deliver timely royalty statements and to pay royalties due to the authors. Among other matters, the complaint requests the court to declare that all rights in the Sinners series previously granted to Month9Books have reverted back to the authors."

June 16, 2016

Tate Publishing & Enterprises Slapped with $1.7 Million Lawsuit, Department of Labor Investigation

Posted by Victoria Strauss for Writer Beware

Since putting this post online, I've received dozens of questions about whether there's a class action lawsuit against Tate. To my knowledge, the answer currently is no. I don't think that's the best option, anyway, because given all the complaints by authors and staff of non-payment, I'm guessing that Tate has few resources to tap for reparations.

Instead, I'd strongly encourage authors to file complaints with the Oklahoma Attorney General's Office and with the FBI. Individual complaints don't usually spur action, but a volume of them may, especially if they are received over a short period of time. The Oklahoma AG has already received a lot of complaints about Tate.

File a complaint with the Consumer Protection Division of the Oklahoma Attorney General's Office

Contact the FBI field office in Oklahoma City


This is a developing situation; see the updates at the bottom of this post.

Readers of this blog may be familiar with Tate Publishing & Enterprises--an Oklahoma-based publisher that describes itself as "a Christian-based, family-owned, mainline publishing organization with a mission to discover and market unknown authors."

Tate takes pains to depict itself as a selective traditional publisher that accepts "only a single-digit percentage of authors who submitted manuscripts for publication" (a claim that's a little hard to credit from a publisher that, if Amazon is to be believed, pumped out 3,000 titles in 2015). In fact, authors must pay nearly $4,000 to publish with Tate, with even more due if they choose to buy any of Tate's array of extras, such as "personalized author websites" and video book trailers. Tate also incentivizes author book-buying, by promising to refund the original fee once 2,500 books are sold and allowing author purchases to count toward the total--though only if made in bulk quantities of 300 or more.

There is no mention of any of this on Tate's website or in its videos. Tate doesn't disclose its fees until authors either submit a manuscript or request more info. For that reason, as well as the very large volume of complaints we've received about the company (many of them from writers who approached Tate in the belief that it was a traditional publisher), Tate is included on Writer Beware's Thumbs Down Publishers List. (For this and other comments we made, Tate claimed in a 2008 blog post to be suing us, but no lawsuit was ever filed.)

You don't have to take my word about the complaints, by the way. In 2015, Tate was the second most complained-about company to the Oklahoma attorney general. Many more complaints--not just about Tate Publishing, but about its vanity recording subsidiary, Tate Music Group--can be found online, including at the Better Business Bureau--where, despite 102 complaints over the past 3 years and what the BBB acknowledges as "a significant pattern of complaints", Tate has an "A" rating. (How do you get an "A" rating from the BBB despite more than 100 customers complaining about your service? Sign up to become a BBB accredited business and make sure you respond to everything.) (UPDATE: Sometime between me putting this post online and June 24, the BBB suspended Tate's accreditation and removed its rating.)

Tate got some unflattering news coverage in 2012, when CEO Ryan Tate fired 25 production workers in retaliation for an anonymous email about rumored layoffs at the company (the rumors were sparked by Tate's decision to outsource some of its work to the Philippines). Ryan Tate's nearly 20-minute rant, recorded secretly by an employee, went viral after it was leaked online. (You can listen to it--if you dare--here. You can also marvel at Tate's Employment Agreement, here.)

Now Tate may be in bigger trouble. Xerox Corporation, which leases some of the equipment Tate uses for its 24-hour-a-day printing facility, has filed a $1.7 million lawsuit against Tate Publishing and Ryan Tate, alleging defaults on re-structured lease and service agreements and on a promissory note executed to address previous debt, and seeking re-possession of $450,000 in leased equipment as well as a money judgment of $463,786.90 against Ryan Tate personally, as Guarantor on the promissory note. The full petition can be seen here.

The suit has spurred some local media attention, and Ryan Tate isn't taking it lying down. To The Journal Record (sorry--paywall) he characterized the lawsuit as intimidation. "[Xerox is] just positioning and posturing, trying to force us to sign some different long-term contracts we’re not interested in." To KFOR.com he downplayed the impact of the suit, describing Xerox as "really a small part of our manufacturing process.” To the Mustang News, he claimed that "We are in the process of filing our counter suits and Xerox is trying to force us to use their equipment for our shop on a long-term basis as well as they have failed to deliver on some major contractual elements in regards to service, maintenance, and equipment purchases." (Worth noting: according to this glowing 2011 "case study" on Tate's partnership with Xerox, Tate has been working with Xerox since at least 2007, and its production facility is set up with "all Xerox digital equipment.")

That's not the only lawsuit Tate is fielding at the moment. One of its authors, Bat-Zion Susskind-Sacks, has filed suit for breach of contract, deceptive trade and marketing practices, fraud, and several other causes of action, alleging that she paid over $12,000 for a book that was published full of errors (twice) and never marketed. She's asking for her money back, as well as attorneys' fees and damages. Her amended complaint, which includes pages from her book showing the mistakes, can be seen here.

Summonses in both suits were issued on the same day, May 27. Tate has 20 days to respond. Stay tuned.

UPDATE 7/1/16: More trouble for Tate. Local news station KFOR reports that staff have been laid off from Tate's printing plant, and author complaints of non-payment are surfacing (Writer Beware has received similar complaints).

UPDATE 11/15/16: Per the most recent updates to the court docket, plaintiff Xerox has successfully re-possessed its equipment, but retained a cause of action for lease amounts still due. It has also discovered additional debts that weren't included in the original complaint. Accordingly, it has filed an Amended Petition raising the total money amount it's seeking from Tate to $1.89 million.

Meanwhile, the US Department of Labor has launched an investigation into Tate--an investigation that has spurred allegations of tampering from some Tate employees, who claim that Ryan Tate "coached" them on what to say.

UPDATE 11/30/16: Nobody knows the troubles Tate's seen...oh, wait, everyone does. News Channel KFOR reports that three new lawsuits have popped up this month: one by a musician suing over copyright laws (a customer of Tate Music Group, which also runs on a vanity model); one by memorabilia manufacturer Jostens, which claims that Tate owes it more than $13,000; and one by the property company that leases Tate its print shop (vacant now that Xerox has re-possessed its equipment), which claims that Tate owes nearly $20,000 in rent.

UPDATE 12/22/16: I'm getting a flood of emails and comments not just from Tate authors, but from Tate staffers in the Philippines (you can see some of the comments below). Here's what I'm hearing.

- Apparently Tate's Philippine workforce once numbered close to 1,000, but massive dismissals have seriously reduced this. The consensus seems to be that around 80% of staff have lost their jobs since October.
- Unpaid or part-paid salaries and bonuses; apparently corporate headquarters in the USA hasn't been wiring enough money to cover payroll.
- Staff complaints filed with the local Labor Department, citing salary disputes and dismissals without the required 30-day notice.
- Production halts and slowdowns have put books in limbo, since there's no longer sufficient staff to work on them.
- Resignation of high-level corporate staff in the US.
- Silence on these issues from corporate headquarters.

The Philippine staffers I've heard from are convinced that Tate can't survive much longer. Several have told me that they suspect that the Tates are shifting assets to a new company called Lux Creative Concepts LLC, which was registered in February 2016 by Ryan Tate's wife, Christy Kelley-Tate.

Stay tuned.

UPDATE 1/10/17: From the comments on this post, today--I stress that this is unconfirmed. [UPDATE:: at least one Tate author has received an email from Tate's marketing department confirming the closure]

"Tate Publishing has officially shut down their business in the Philippines today. Their main office in Cebu has been locked up by the Department of Labor and the owner of the building due to non-payment of the rent."

UPDATE 1/11/17: And another:

"I'm an ex-employee of Tate, and we were just at the Cebu office yesterday. Today is the the last day that the office is open, mainly for HR to furnish ex-employees with certificates of employment and other documents. The Department of Labor has officially ceased all operations and is taking stock of the company's physical assets.

We have been informed that, as of this writing, there is no official directive or announcement from the Tates that the company is closing or declaring bankruptcy."

UPDATE 1/12/17: More on the Philippines debacle from an Oklahoma-based blog that has published a lot of articles about Tate's shenanigans. A former Tate staffer in Tate's now-closed Cebu offices describes partial payment of salaries, non-payment of government-mandated bonuses, and other problems dating back months.

I've received many similar emails from Cebu staffers, one of whom shared with me the Department of Labor notice resulting from a compliance visit to Tate's Cebu offices on January 9. Findings:


UPDATE 1/14/17: Some Tate authors report receiving an email signed by Tate's Director of Production, Tim Kelley, claiming that Ryan Tate hasn't paid employees and "your book will never be finished." This email was reportedly followed, within a couple of days, by another email claiming that the first email was the result of "identity theft" and its allegations aren't true.

Okay.

Meanwhile, Tate authors are receiving this, also--apparently--from Tim Kelley:


Things are fine, folks, just fine. Never mind the mass layoffs of employees. Never mind the lack of payment and non-communication. It's all just a transition.

I'd love to hear from Tate authors who sign up for the portal. Have you received any results from your "new support ticket"?

UPDATE 1/16/17: There's now a forum for Tate authors to share experiences and support: Tate Publishing Help.
 
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