Author Warranties: Options for Contract Clauses

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April 2011
by Steve Gillen

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Your book publishing contract probably includes provisions that require the author to make certain promises about the manuscript submitted for publication—that it’s an original work, that it doesn’t infringe the intellectual property rights of any third party, that it isn’t libelous, and so on. Because only the author is in a position to know whether the things promised are true, this is both appropriate and absolutely necessary.

But variations in the core content of such provisions suggest that publishers may not understand the risks to be addressed. What follows is designed to help you choose language that will serve you well and evaluate the revisions that may be proposed by an author, agent, or lawyer.

The intro to these provisions generally says, “The Author represents and warrants . . . ” not to be redundant (though we lawyers sometimes are) but because, strictly speaking, a representation is a promise that the fact asserted is true at the time the contract is entered. A warranty, on the other hand, is a promise that the thing asserted will be true or will happen (or not happen, as the case may be) in the future.

The distinction between representations and warranties has the potential to be significant because the legal consequences that follow breach of a representation are different from those that follow breach of a warranty (rescission and restitution being available as remedies for the former but not for the latter).

What typically comes after this phrase in most publishing contracts is a mix of some representations, some warranties, and some statements that are hard to categorize due to sloppy drafting.

The Common Promises

The Author is the sole and exclusive author of the Work and the sole and exclusive owner of the rights herein granted to the Publisher. With few exceptions, the copyrights in a manuscript vest automatically in its human authors. Because registration and notice are not prerequisites, no independent search or examination available to you will reveal all potential claimants to a manuscript—you are entirely at the mercy of your author with respect to disclosure of this information.

There is no good reason for your author to refuse to make this rep, because it is based on information that the author necessarily has. If there is someone else with a claim to the manuscript—perhaps a ghostwriter or an undisclosed collaborator—you want to know that so that you will have an opportunity to secure all the exclusive rights to the work from every potential claimant or so that, if you choose not to do so, you choose knowingly.

The Author has not previously assigned, pledged, or otherwise encumbered the Work. Similarly, if the author has pledged rights in the manuscript as security for a loan or otherwise, you want to know that so you won’t be surprised later by a party with a claim superior to yours. (You could take some steps to ensure that your claims have priority, but they are cumbersome and not routinely taken.)

the Work has not heretofore been published, except as follows:

If the work has been published before by another party, you will want to do a search of the Copyright Office records to determine whether there is a public record owner of the copyrights in the previously published edition so that you can do whatever is necessary to complete and update the public record chain of title.

the Work is not in the public domain. In the unlikely event that an author offers you a public domain work that you are interested in republishing, you can, of course, republish it without entering a contract or paying royalties to anyone. Again, no search you can independently do will identify every public domain work, but the genesis of any work is certainly known by the author who presents it.

the Work does not infringe any statutory copyright or common-law literary right of any third party. Only the author knows for certain how the manuscript came to be created, and no matter how diligently you investigate, you cannot be certain that third-party content was not incorporated unless the author says it was not. (The reference to “common-law literary right” is a carryover from contracts written before 1978 that is sometimes allowed to remain because it does no harm and because lawyers are reluctant to surrender any ground once gained.)

> the Work contains no matter which is scandalous, libelous, or defamatory, or which infringes any trade name or trademark, or which violates any right of privacy or any other proprietary right. Although you may not be able to spot every privacy violation or trade secret misappropriation without some input from the author, you can take steps to identify unacceptable risks in these areas (and you should take them for certain manuscripts, such as an unauthorized biography, an exposé, a tell-all memoir, or a book about some scandal).

This provision is routinely included in contracts, not as a substitute for the publisher’s exercise of appropriate diligence but to ensure that the author also has a direct and substantial stake in disclosing and dealing appropriately with these risks.

there are no errors or omissions in any recipe, formula, design, or instruction in the Work which might harm the user. In the United States, the First Amendment provides publishers with a great deal of freedom to publish without fear of liability to dissatisfied readers. There have been a few noteworthy exceptions, however, where a publisher was held to be liable for egregious errors—e.g., incorrect airport approach coordinates that led to a fatal crash, and faulty chemical-experiment instructions that produced an explosion injuring a student.

Presumably your author’s bona fides include professed expertise on the subject at hand, and so it is appropriate to hold the author accountable for any claim that might result from an error or omission, regardless of how unlikely. The provision may also help focus an author’s attention on guarding against errors or omissions that might hurt readers.

Variations

Be alert to the following, less common provisions. Some do not achieve the desired intent, and some are just poorly drafted.

is not restricted by contract from entering into this Agreement or carrying out the Author’s obligations hereunder. Just as your contract probably includes a noncompete or a next-book option clause that precludes your author from writing another work for any other publisher without first coming to you, the contracts of those other publishers restrain their authors from coming directly to you with their next manuscript. Accordingly, a rep such as this one is intended to address the author who comes to you with a manuscript, in breach of an obligation to a prior publisher.

all statements of fact contained in the Work are true or are based upon reasonable research. This should provoke a raised eyebrow. Not every error of fact in a manuscript is of equal consequence, and many errors have no potential to give rise to a third party claim; for example, “The United States is comprised of 51 states” is an error, but not one you could be sued for including in a book.

No one wants to publish a manuscript with errors, but including a provision such as this in the author’s reps and warranties would be akin to requiring a warranty that there are no typos, misspellings, or errors of grammar; and putting something trivial in a list of otherwise significant issues tends, I think, to dilute or diminish the impact of the others.

the material in the work is verifiable as fact. Likewise, only worse; this language excludes all opinion and doesn’t, strictly speaking, exclude any errors since it requires only that the material be capable of verification, not that it be actually verified.

the Author has full power and authority to enter into this Agreement. Here again, probably a case of overkill. Most authors enter publishing contracts on behalf of themselves individually, and if they happen to be under age or legally incompetent, the telltale signs probably won’t escape a prospective publisher’s notice.

This language is common in corporate acquisition documents and might once have been inserted in an author contract for an author contracting in the name of a personal services corporation for tax reasons, and then just never removed.

the Work has not been previously the subject of an application for copyright registration. On rare occasions, an author will register a manuscript with the Copyright Office as an unpublished or self-published work out of concern about possible infringement prior to authorized publication. When this is the case, there will be a public record of title that, unless corrected and updated, could result in another later purchaser who relies on it obtaining an interest superior to yours. A cautious publisher will ask the question, but there is no good reason to assign this issue the importance associated with a separate rep.

the Author has no knowledge of any claims, actions, or proceedings, pending or threatened, against Author and affecting the Work, other than those disclosed to Publisher in this Agreement;

An author who is already being sued for libel by the subject of one book would, one hopes, disclose this in a pitch to another publisher for another book about the same notorious subject. That one author once neglected to do this accounts for the inclusion of this rep in at least one publisher’s contracts.

the Author will not obligate the publisher to any author or any other person except as provided in this agreement;

I can only imagine the event that must have prompted inclusion of this warranty in a publisher’s contracts, and I have seen it only once. Maybe some publisher put an author in a position to make financial commitments on the publisher’s behalf.

the Author has not misrepresented the Author’s academic or other credentials and will not provide any false or materially misleading documents concerning the work;

This concern may be valid but, like typos and spelling errors, not every concern merits attention in the author’s reps and warranties. If the author misleads in these ways, there will doubtless be other grounds for rescinding or terminating the contract.

the Author has fully disclosed the existence and nature of all book-length works which the Author alone or with others has written or contracted to prepare;

Another perfectly valid concern, but probably not one that merits this attention in the author’s reps and warranties.

the work does not disclose any information given to the author on the understanding that it would not be published or disclosed;

Although this goes a little beyond trade secrets to reach information that is merely confidential and not necessarily also proprietary, I’m not sure that it covers anything not already addressed in the common core of author reps.

no material in the work plagiarizes any other work;

Plagiarism is not a synonym for copyright infringement, and although it’s disdained, it is not necessarily illegal. You can plagiarize a public domain work, but you cannot infringe it. To the extent that plagiarism might produce a claim, it is already covered by other reps and warranties, and to the extent that it would not, it probably does not merit extra attention here.

Input from the Author’s Side

Regardless of which of the foregoing reps and warranties you choose to include in your publishing contracts, savvy authors and agents will press to limit their application to the manuscript as supplied by the author, and will want to expressly exclude any changes made or material added by or at the direction of the publisher.

This is reasonable in concept, provided you are careful with the language you use to execute it so that you do not inadvertently absolve an author of responsibility simply by having made edits that did not increase the likelihood of a claim.

More problematic is the co-author who resists the notion of joint and several responsibility and wants to disclaim responsibility for the contributions of the other author(s). Though reasonable in concept, this allocation of responsibility can be impossible to execute because of difficulty in distinguishing the contributions of each.

More problematic still is the author who wants to qualify any of the reps with a knowledge limitation—e.g., “to the best of the Author’s knowledge . . . ” or “the Author does not know or have reason to know . . . ” You should almost always just say no to such requests.

About Indemnity

The language that puts the teeth in these provisions begins: “The Author shall defend, hold harmless, and indemnify . . . ”

Most contracts require the author to indemnify the publisher for any damage or cost incurred as a result of any breach of the author’s reps or warranties. Some contracts also include any “alleged” breach within the author’s responsibility, making the author responsible for defending all claims, without regard to whether they eventually prove to have merit.

Knowledgeable authors and agents will object to inclusion of “alleged” breaches on the grounds that frivolous claims are a cost of doing business that should be borne solely by the publisher. There is, however, some distance between a claim that is simply frivolous and one that is just finally adjudged to be without merit. If you are willing to compromise, be careful of your language so that you do not give ground you do not intend to give.

The indemnification provision also typically:

• gives control of the defense to the publisher

• gives the publisher authority to settle any claims (sometimes conditioned on the author’s

reasonable consent)

• allows the publisher to suspend royalty payments while any claim is pending

• requires the publisher to provide prompt written notice of any claim to the author

• obliges the author to cooperate in the defense

• provides that the indemnity survives termination of the contract

• extends the indemnity obligation to also encompass claims against the publisher’s licensees,

assignees, and distributors

There is room to negotiate on some of these provisions without materially compromising your interests. But be alert to material changes that may have an adverse impact on your media-perils insurance coverage, unless your insurer has been appropriately and timely notified of the changes.

Authors and agents sometimes ask that the author be added as an additional named insured to the publisher’s media-perils insurance policy. Although this request can be accommodated, in practice it provides little real comfort for authors because they are still responsible for a deductible or self-insured retention that is typically in the six-digit range. The better course for most authors (and one that is less burdensome for the publisher) is purchasing an author’s policy with a much smaller deductible. Both IBPA and the Authors Guild refer their respective members to Publiability.com as one source of such coverage.

Of course, no author’s indemnity obligation can serve as a substitute for adequate insurance, since the obligation will be only as good as the author’s pockets are deep. But it is still important to ensure that you have the author’s full attention and cooperation in any defense (and also that you don’t have to pay royalties on a work at the same time you are paying to defend it). Check your form contracts against these points to ensure that what you need will be there if you need it.

Regardless of how comprehensive your contract’s reps and warranties are and how solid the indemnity is, your comfort will have to come primarily from a mix of diligence and insurance—diligence to help you avoid claims in the first place, to the extent you can, and insurance to protect your pocketbook when diligence isn’t enough. Although most publishing contracts reserve to the publisher the final decision on whether, what, and when to publish, you might consider expressly and separately reserving the right not to publish any material that in your judgment may result in a breach of any of the reps or warranties—being careful at the same time to disclaim any obligation to the author to independently investigate or vet the manuscript.

Steve Gillen is a lawyer and partner in the intellectual property firm of Wood Herron & Evans, and has focused his practice on publishing and media matters for 30 years. He is a member of IBPA and a frequent contributor to the Independent. To reach him: sgillen@whepatent.com; or 513/241-2324.

 

 

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