Contract Review: Leverage Media

Now, remember that I'm not a lawyer and that nothing I write here is legal advice. However, I have done a lot of custom publishing work and, as a result (as well as reviewing contracts for other writers), have seen many custom publishing contracts. So when I say that a given custom publishing contract is probably the single worst I've seen in the field, it's saying a lot. But that's the case for the Leverage Media that someone recently forwarded to me:

• 1b - when the contract defines the writer's contributions as specifically including, but not limited to, " all documentation or information resulting, in whole or in part, from services that Contractor provides under this Agreement, including but not limited to all drafts and computer-readable materials prepared for LM, LM’s Clients or LM’s Potential Clients," you know you're in trouble. Look again - all information. I suspect your contribution would include all notes, interviews, and other research, which is a whole lot to give away at rates that, from what I hear, aren't that much higher than $1 a word.


• 1d - The contract specifies "this Agreement shall not be deemed to be for a fixed term of any duration, and is terminable at will." Does that mean that the publisher (or the writer, for that matter) could call it quits in the middle of a project without any provisions for the time book that is no longer being used? Certainly sounds plausible.


• 1e - This clause says that time is of the essence, which means if you're late, it's a major breach of the contract and might let the other party out. Also, "any failure by Contractor to complete such tasks in a professional manner by such date shall be deemed a material breach of this agreement." Oops - another open manhole cover. And all Leverage would have to do is pay any out-of-pocket expenses, previously allowed in writing, that you've undertaken.


• 1f - Here's a real winner: "(f) Except as set forth above in Paragraph 1(d), either party, upon giving 5 days written notice of any material breach of this Agreement (including, without limitation, Contractor’s failure to provide services), during which 5-day period such breach remains uncured, may terminate this Agreement." But 1d says that either side can terminate the contract at will, so this doesn't do a whole lot.


• 1g - Sound the fire alarm. You don't get paid unless and until the ultimate client pays Leverage. So, no matter how well you do, if they can't keep the relationship going, or if they screw up in some way, they expect you to write off the work you just did. That seems like a sucker clause to me, 'cause only a sucker would sign it.


• 2 - They want to own all information, whether marked confidential or not, and any work you come up with. So, if they don't get paid, does that mean they still own what you did?


• 3 - Solidifying the grab, what you write is under a WMFH agreement, and if something isn't a candidate for WMFH treatment under the law, you hand over copyright. And if they don't pay because their client didn't pay them? Well, they told you that in the contract. IT might be that a court would toss out the agreement, saying that, as there was no payment, there could be no business transaction, which must be the basis of a contract, but you'd have to spend money on a lawyer for that.


• 4 - The warranties are pretty broad, and the writer will not "violate any copyright, trademark or service mark, common law or any other right, or defame or harm the individual or business reputation, of any person, corporation, or other entity." At least a later clause says that the contract must be construed under New York law, so perhaps you aren't providing a warranty under the laws of other countries, as well.


• 5 - Now comes the confidentiality and non-disclosure statement. Nothing necessarily so over-reaching here, but, good golly, all this verbiage and legal consideration for a crummy article?


• 6 - Many companies that subcontract writers, etc., have provisions for not allowing a subcontractor to poach its clients. That's fair enough. However, this contract is more broadly worded. For example, you are supposed to agree not attempt to get business, whether directly or through some other company, that is similar in nature to what Leverage does. There's a two year time limit on this - about double what I've seen elsewhere, and clauses like this are hardly the rule. Plus, not only does it apply to current clients and even prospective clients (and just how big is that list, anyway?), but even some number of prior clients that, apparently, no longer do business with the firm. This is a list that includes a number of law firms and even some magazine publishers like Chief Executive and Crain's New York Business. Jeez. And if you do slip, even accidentally, they want you to agree to turn over 150 percent of the money you made from the client!


• 7 - I never trust contracts that call for automatic injunctive relief on the part of one party but not the other, because it's unreasonable to expect that someone can demand an injunction without having to provide a pretty high bar of reason for so asking. This company's agreement is one such.


• 9 - Not only do they want indemnification for any breach of warranties, representations, and so on, but for any alleged breach. "Oh, sorry, we claim that you breached the contract, so we're going to get an injunction and, please, pay our legal bills for doing so."


• 12 - They like New York laws, which is fine, and want you to take up any legal problem in Westchester County, which is not.

I may have missed something or other in the agreement, but with one like this, it would hardly seem to matter.