Working with Other People
Writers frequently work with other people. Common situations include working relationships between coauthors, editors, ghostwriters, illustrators, and photographers. Given the expected degree of cooperation and contribution inherent in ventures where two or more people work together, it should not be a surprise that these kinds of relationships can be fertile grounds for conflict. Moreover, problems can escalate when contributors encounter situations they did not anticipate. For example, disputes can develop over issues as simple as which party’s name is listed first on the cover or as complex as sorting out what happens if one party becomes incapacitated or disenchanted before the project is completed.
The publishing industry uses several distinctions to describe people who collaborate to produce a work. Although these distinctions are useful for conducting business, they do not define the legal relationship between the parties. They can be helpful factors in deciding what kind of relationship exists between them. A common relationship among writers is that of coauthors, in which two or more writers collaborate to produce a joint work, such as an article or book. Another type is that of editor and contributing authors, in which the editor solicits individual works from several writers and compiles them into a single work. There are also relationships in which one person is identified as the author, although someone else does most or all of the actual writing. Ghostwriting is a situation in which the actual writer is never identified as such. The as told to work is another variation, where the speaker is identified as the primary author, but credit is provided to the actual writer in the form of as told to.
Writers also collaborate with visual artists (typically photographers, graphic artists, and fine artists). As with literary collaborators, the descriptions customarily used in the publishing industry do not define the legal relationship between the parties. For example, contributions by illustrators and photographers can range from a minor portion of a book, such as the author’s photograph on a dust jacket, to the majority of the book, such as one that consists of dozens of photographs and a short written narrative. In such cases, the legal relationship will be determined by factors such as the parties’ intentions, agreements, relative contributions, and business practices.
Before working with others, it is important to fully discuss each party’s expectations and to reach a consensus. Written agreements are strongly recommended, since memories about the parties’ agreement can (and often do) blur when a dispute arises. Furthermore, the mere act of preparing a written agreement tends to encourage the consideration of issues that might otherwise be overlooked. Specific issues that should be discussed are described in the remainder of this chapter.
SCOPE OF THE AGREEMENT
It is important for the parties to describe the scope of the project and define their relationship. Most parties to a writing project will limit the relationship to a particular work. If this is not the case, the parties should clearly distinguish what kinds of projects they intend to perform jointly and which ones each can perform alone. Likewise, the parties should specify how they intend to work with each other on subsequent editions, derivative works, and related projects. For example, if the parties work together on a magazine article, they should decide what happens when one of them wants to revise the article to sell to another magazine or wants to incorporate the material into a book authored by that person alone.
The nature of the relationship should also be described with specificity. If two writers decide to write a book together and agree to share the profits, they will usually be considered to be a partnership or a joint venture if they do not incorporate or form a limited liability company. There is nothing inherently wrong with being partners or joint venturers, so long as this is the intended relationship. On the other hand, it is always better to be clear about the nature of the relationship because it affects issues such as control over the product, liabilities, and tax obligations.
Another kind of relationship that writers can enter into as collaborators is that of employer/employee. For example, if a writer pays an illustrator to provide a drawing for a chapter in a book, this relationship is most likely one of employer and employee, or employer and independent contractor. If a writer and illustrator agree to work jointly to produce an illustrated book and share the royalties equally, the relationship is more likely to be construed as a joint venture or a partnership. However, unless the parties take measures to define their relationship, they run the risk of operating in the gray area where the relationship could arguably be considered either a partnership or that of employer and employee or independent contractor. If a dispute or legal question arises in such cases, courts and government agencies will look to various factors in making the determination. In such cases, the determinations can profoundly affect issues such as copyright ownership and how profits are distributed, liabilities are shared, and taxes are assessed.
A major difference between a partnership and an employer-contractor relationship is that an employer has control over what the employee produces, whereas partners share control over management decisions. If the relationship is that of employer and independent contractor, the control is over the product but not over how the result is achieved. The amount of control is the key factor in determining whether an employee is considered to be an independent contractor or a statutory employee (also known in common law as a servant). This distinction is important because the consequences of having a statutory employee are significantly different from those associated with independent contractors. For example, there are no requirements to withhold income tax or comply with employee protection laws when working with an independent contractor. Whether a particular person is a statutory employee or an independent contractor will largely depend on
• the amount of control over the method of performing the assigned task;
• the understanding between the parties;
• the agreement they have worked out; and
• other factors that have been articulated in the tax and labor laws.
A person who receives extensive instructions or is trained by the employer to perform the required tasks is likely to be considered a statutory employee. Similarly, someone who invests in the equipment needed to do the work, is not reimbursed for all of his or her expenses, can incur a profit or loss, and who performs similar work for others is more likely an independent contractor.
As discussed in chapter 15, collaborators who are partners or joint venturers will be legally liable for the misdeeds of the other collaborators. One way to ameliorate, but not eliminate, the liability is to have each collaborator agree that the others will be reimbursed if that collaborator does something that gives rise to a liability. Normally, collaboration agreements first have each party warrant to the others that he or she will not do anything in connection with the work that infringes a copyright, defames any person, violates a right of privacy, or injures any personal or property right of another. Second, they have each party agree to indemnify the others for loss, liability, and expense arising from any breach of the warranties. This means that the collaborator whose actions caused the liability will agree to not only pay any damages that might be awarded to the injured person, but also pay the legal expenses of the other collaborators in defending the action. This, unfortunately, has limitations, since a party agreeing to pay these expenses must have the resources to fulfill that obligation. Another method of dealing with this is for the parties to purchase insurance. Regrettably, the cost of such insurance is fairly steep.
TERM OF AGREEMENT
Written works can remain in print for a long time, so the collaborators should define how long they intend to be bound by their agreement. A common provision for coauthored books is for the agreement to last for the period of the copyright in the book and any subsequent revisions thereof. This period is measured by the life of the longest-living collaborator plus seventy years, when the copyright is owned by the authors. In such cases, the writers are legally bound to cooperate with each other in the event that the publisher requests that the book be revised. If the writers wish to have different obligations, these should be expressed in the agreement.
OWNERSHIP OF RIGHTS
As discussed in chapter 3, the rights to a work can be valuable. The agreement should make clear who will own the rights to the work and the manner in which they are owned. The most common situation for coauthors who produce a unitary work is joint ownership of the copyright. That is, the parties will jointly own the copyright in a single work. If each writer wants to be the sole owner of the portions he or she contributes to a work, this should be specified in the agreement. Under copyright law, a contributor to a work must provide copyrightable material in order to be a joint owner.
Since mere ideas cannot be copyrighted, persons who work with ghostwriters or as told to writers cannot own the copyright, except in works for hire or if the copyright is transferred by the actual writer through a written agreement. To qualify as a work for hire, the work must be written by an employee within the scope of his or her employment (i.e., a statutory employee). If written by an independent contractor, the contractor and employer must agree in writing that the work performed is to be a work for hire, and the work must be specially ordered or commissioned to be a contribution to one of the following:
• a collective work
• a translation
• a part of a motion picture or other audiovisual work
• a compilation
• an instructional text
• a test or answer material for a test
• an atlas
• a supplementary work (one that introduces, concludes, explains, revises, comments upon, or assists, etc., a work by another author)
In the absence of a written agreement, the independent contractor will own the copyright in a commissioned work.
When the work is not unitary, such as when an illustrator contributes a few drawings to a book, the contributors will separately hold the copyrights to their individual contributions. Even so, it is a good idea to confirm this in the written agreement, since ambiguities can affect the ability to control how the rights to the individual contributions are licensed in future transactions. For example, an illustrator may not want the writer to claim part ownership of the copyright in the illustrations, and the writer may not want the illustrator to claim any rights in the text.
The collaboration agreement should describe the role of each party and their agreed contributions to the work. It should also state that the contributors are required to use their best efforts with respect to their contributions. Another important issue, particularly when working as coauthors, is to include the agreement as to who has control over the content. Typically, it is best to require the parties to agree to consult with each other in good faith regarding issues concerning content, but specify that one of the contributors will have the final say in such matters.
Another issue that should be addressed is how revisions will be handled once the manuscript is completed. It is recommended that the agreement forbid one party from making changes to the manuscript without the consent of the other contributors once they agree it is complete. It is also a good idea to specify how the contributors will respond to revisions recommended by the publisher. Editors have been known to make substantial changes to works, and publishers often provide writers with short time frames in which to review edited manuscripts and galleys. Therefore, writers should decide ahead of time how they want to allocate the responsibility for review and address revisions proposed by the publisher. Similarly, if the book contract requires the writers to prepare an index, the contributors should decide on whom that responsibility falls.
In addition, it is a good idea for the contributors to discuss and agree on the schedule of production, when the contributions will be provided to each other, and who has the final approval. For example, writers should decide whether they want to see the work as chapters are completed or whether they want to wait until all contributors have completed their assignments. Reaching agreement regarding the logistics of preparing the manuscript can be particularly important when one contributor needs to see the work of another to complete his or her assignment.
EXPENSES
In many cases, the individual expenses incurred by the contributors are so small that sharing the costs will not be an important issue. In some cases, however, one or more of the contributors may bear a disproportionate part of the expense, and whether and how the costs are shared may be important. This is particularly true when the contributors work in different media or one’s responsibilities entail substantial expenses not incurred by the other contributors. ,A writer who has to travel to conduct interviews will incur expenses that the non-traveling contributors will not have. In these situations, the parties should discuss how the expenses will be apportioned before they are incurred, in order to avoid disagreement later.
The agreement should describe with some degree of specificity the kinds of expenses that will be shared and whether or when approval of the other contributors is required before they are incurred. For example, most writers will feel comfortable agreeing that the contributors can incur copying and postage expenses without prior approval, but will want to know beforehand if one of them decides to take a trip to Paris in furtherance of the book.
Attention should also be given to the mechanics of how expenses will be shared. The agreement should require that the contributors keep accurate records of, and receipts for, their expenditures, because failure to do so can jeopardize the ability to deduct expenses from taxes. Likewise, the agreement should specify when reimbursements are to be made, since hard feelings can arise when one contributor wants to be reimbursed immediately and another wants to wait until the advance or first royalty check is received. One solution is for the collaborators to place the advance, or a portion of the advance, in a restricted fund earmarked for expense reimbursement.
COMPENSATION
It is important not only to describe how much the contributors will be paid, but also the manner in which they will receive payments. If one or more of the contributors will be paid only a fee by the others, then the agreement should make it clear that those contributors have no claim to royalties from sales of the work. If the contributors agree to share the proceeds on a percentage basis, then the agreement should specify the percentages for each contributor.
The parties should also consider how proceeds from subsidiary or ancillary products related to the work will be distributed. For example, a writer and illustrator collaborate on a children’s book without a prior agreement, and the book is very successful. The contributors might disagree on how proceeds from prints and posters should be distributed, since the illustrator may feel that the writer contributed none of the creative effort and the writer may feel that contributing the text to the book created significant interest in the work. Likewise, the position might easily be reversed with regard to the proceeds from an unillustrated audiobook. Irrespective of how the proceeds should be distributed in such instances, it is much better to deal with the issue of subsidiary and ancillary products when drafting the agreement than to deal with a dispute later.
The mechanics of how proceeds will be distributed should be addressed as well. Publishers are often reluctant to cut separate checks to collaborators, so a single check may be sent to one of them. Therefore, the agreement should specify who will receive payments from the publisher, and should define that person’s obligations regarding how quickly the other contributors are to receive their portion of the proceeds. Specific issues that should be addressed are the method of payment (e.g., check, wire transfer, etc.) and the time period in which the payment should be made.
USE OF MATERIAL
Collaborators often share materials, such as research and reference materials, when preparing manuscripts. The agreement should state that such materials will be returned as soon as they have served their purpose. If the materials are valuable or susceptible to damage or deterioration, the collaborators may want to consider specifying appropriate standards of care.
TERMINATION
Some writing relationships were just not meant to be, so it is a good idea to define what happens in the event that the relationship sours. Note that the main purpose of a termination provision is to clarify the parties’ obligations when one of them is unable or unwilling to complete the project. It does not necessarily free the parties from the obligations they have incurred under the contract. For example, a celebrity who has hired a ghostwriter to write an autobiography cannot evade the obligation to compensate the writer merely because he or she decides to terminate the agreement when the manuscript is 95 percent complete.
Agreements typically give any party the right to terminate the agreement within a specified period by written notice to the other parties. They should also require the parties to immediately return materials that belong to the other parties. An agreement should also include what arrangements must be made for completion of that party’s contribution to the work and who is responsible for paying for it, particularly if an agreement with a publisher remains in effect.
In the case of a ghostwritten or as told to arrangement, the speaker should establish some sort of protection for the material provided to the writer during the course of the relationship. Without such a restriction, the writer is free to produce an independent work based on the same material.
DEATH OR INCAPACITY
A collaboration agreement should describe how the work will be completed in the event of the death or incapacity of a contributor prior to the completion of the work. One common provision is to give the other party the discretion to either complete the manuscript and submit it for publication or to stop working on the project. Other ways to deal with incapacitation issues are to allow the remaining party to find a replacement to complete the project, or give the guardian of the incapacitated party (or the decedent’s estate) the option to find an appropriate replacement.
The agreement should also deal with how the proceeds will be distributed in the event a contributor dies or is incapacitated before the work is completed. The simplest kind of provision is to specify that all contributors will take in their agreed shares, provided that the remaining contributors complete the work. The primary benefit of this kind of arrangement is its simplicity. However, some collaborators may feel that it is fairer to apportion the proceeds pro rata—according to the extent each party completed his or her contribution. For example, if a contributor becomes incapacitated after completing only 5 percent of what he was expected to contribute, the other contributor might be uncomfortable with having to split the proceeds if he or she ultimately does 95 percent of the work. The difficulty with pro rata provisions is that it can be difficult to assess the proportion of work that has been completed, and doing so can lead to disputes. Therefore, it is important that the agreement provide for the manner in which disputes will be resolved.
DISPUTE RESOLUTION
Disputes among collaborators over issues such as the adequacy of their contributions and apportionment of compensation are not only painful—they can be expensive to resolve. One issue that collaborators may want to consider is whether they would prefer to resolve disputes through mediation or arbitration, rather than through traditional litigation. Mediation is a process in which a neutral third party facilitates the negotiation process but does not decide the dispute. Although not binding, it is often effective and can be a quick and relatively inexpensive means of resolving a dispute. Arbitration uses one or more neutral third parties, who independently resolve the dispute. It is somewhat similar to hiring a private judge, except that it does not always offer the opportunities for discovery and appeal that are provided by judicial systems. Nonetheless, it is believed by some to be quicker and more cost-effective than going to court. If the parties want to resolve their disputes through mediation or arbitration, it should be specified in the agreement. Otherwise, their recourse will be through the courts if an agreement cannot be reached.
In most instances, the parties in a dispute will bear their own legal expenses. However, it is possible to contract so that the party who loses a dispute will have to pay the expenses of the prevailing party. If the parties do so, they should also specify in the agreement whether the prevailing party is entitled to have their legal expenses paid should the initial decision be appealed to a higher court.
BOILERPLATE TERMS
Agreements should also contain a few housekeeping terms common to most agreements. A merger clause is a statement that the agreement constitutes the entire agreement between the parties and supersedes all prior agreements, understandings, and proposals. The purpose of a merger clause is to prevent a party from relying on previous statements and documents to establish that there are terms to the relationship other than those specified in the written document. A modification clause requires that any change to the agreement be in writing and signed by all the parties to the agreement. Since each state may have different laws governing contracts, it is important—particularly when collaborators reside in different states—to identify which state’s laws will be used to interpret the agreement. It is also beneficial to specify where (which state and county) any disputes will be resolved. A competent business lawyer with publishing law experience should be consulted when preparing such agreements, since there may be other unique issues to be considered and for which resolutions should be included.