TERMINATING A PUBLISHING AGREEMENT
Once signed, a publishing agreement imposes obligations on the author and the publisher. However, each party may have the right to terminate the agreement if the other party fails to perform certain obligations or if certain other conditions arise. The circumstances under which the publisher or the author will typically have the right to terminate are discussed below:
Termination by the Publisher
Author Fails to Deliver
If the author fails to deliver the manuscript for the work by the due date specified in the agreement, the publisher usually has the right to terminate the agreement and demand the repayment of the portion of the advance already paid to the author. Some agreements give the author an automatic grace period of 30 - 60 days after the due date before the publisher can terminate, and the publisher can always extend this grace period if it chooses to do so. Most agreements state that the author's obligations under the Agreement will continue until the advance has been repaid, effectively preventing the author from taking the book to another publisher without making arrangements to repay the first publisher.
Manuscript Not Satisfactory
Under most publishing agreements, the manuscript must be "acceptable to the publisher in content and form." Publishers usually refuse to agree to any more specific standards for acceptance, particularly if the author is not yet established. However, despite this vague language, a publisher cannot simply reject a manuscript out of hand. The few cases that have been decided in this area have generally held that, before a publisher can reject a manuscript, the publisher must provide the author with the reasons for rejection, and must allow the author a reasonable time to make corrections and resubmit the manuscript. Some publishing agreements contain provisions to this effect. An author who is presented with an agreement without such a provision should request that it be added. If the author has revised and resubmitted a manuscript that was initially rejected by the publisher and the publisher rejects the resubmitted manuscript as being unsatisfactory, the publisher will have the right to terminate the agreement. Some agreements require the author to repay all amounts advanced to the author immediately upon termination. Others only require repayment if the author secures a deal for the book with another publisher. Still others require repayment by a specified date (usually one year after termination), whether the author has secured another deal or not. As with termination for failure to deliver, the author's obligations remain in place until the advance has been repaid, and the author cannot close a deal with another publisher until he or she makes arrangements for repayment.
Changes Required By Legal Counsel
If the publisher's attorney determines that changes need to be made to the work to avoid possible legal claims and the author refuses to make the requested changes, the publisher may terminate the agreement. The author will be required to repay all advances, and will not be able to take the work elsewhere until the publisher has been repaid. Under most agreements, the publisher will have the right to terminate for the author's refusal to make the requested changes at any time, either before or after first publication. If termination occurs after first publication, the author should not be obligated to repay any portion of the advance that has been earned out at the time of termination.
Termination by the Author
Publisher Fails to Publish
The publishing agreement should always include a deadline date for the publication of the book. Including a publication deadline gives the author an opportunity to rescue a stalled book and take it to another publisher, and gives the publisher a mechanism for capping its liability in the event it decides not to publish. In most agreements, the deadline for publication will be anywhere from 12 to 18 months after the publisher's acceptance of the work. If the publisher does not begin publication by the deadline, the author has the option to terminate the agreement. However, termination is usually not immediate. The author is typically required to make a written demand on the publisher to publish, and the publisher usually has anywhere from 60 to 90 days to respond to that demand and begin publication. If the publisher fails to begin publication within the permitted period after the demand has been given, the agreement will terminate, and the author will be free to take the book to another publisher. The author will be permitted to keep all advances that have been paid through the date of termination, and the agreement will usually state that the author will not have any other claim or remedy against the publisher for its failure to publish.
Out of Print
Publishing agreements traditionally defined a book as being "out of print" if the book was no longer available for sale by the publisher or any of its licensees. This definition was usually adequate, given that books were only published in print form, and anything less than a 1,000 copy print run was generally considered uneconomical. If the publisher could not profitably print additional copies of the book, it was generally assumed that no one else could either, and the question of when a book went "out of print" was often academic. However, changes in technology have refocused attention on the "out of print" clause. With the advent of electronic and print-on-demand publishing, it has become possible for publishers and authors to publish books at relatively low cost and without having to maintain any significant inventory. As a result, publishers are likely to favor clauses that define "out of print" as meaning that the book is "not available for sale in any format," and authors are likely to ask that a book be deemed "out of print" if annual sales fail to reach a specified level or if the publisher fails to keep a specified minimum number of print copies in inventory. Alternatively, authors may ask for the book to be deemed "out of print" in a particular format if sales of copies in that format do not exceed a specified level each year. Regardless of how "out of print" is defined in the publishing agreement, the procedures for terminating an agreement as a result of the book going "out of print" will be the same. The author will typically be required to give the publisher a notice of termination. That notice will trigger a grace period during which the publisher must put the book back in print. If the publisher fails to put the book in print during the grace period, the author may, by a second notice to the publisher, terminate the agreement and take back all rights that are not then under license to any third party licensee.
Except for a termination mutually agreed to by the publisher and the author or a termination by the author or the author's heirs under the applicable termination provisions of the U.S. Copyright Act (17 U.S. C. Sections 203 and 304), or unless the publishing agreement is for a defined term or otherwise contains a specific termination provision, the above discussion constitutes a complete list of all of the possible circumstances under which a publishing agreement can be terminated. Unless one of the above conditions for termination exists, the parties will remain bound by the agreement. The publisher will have the right to continue publishing the work for as long as it wishes, and the author will not be able to remove the work from the publisher and take it elsewhere.