There are a number of organizations and individuals, including me, that provide contract advice to writers. I was accidentally copied on an email exchange involving one and, as is my wont, unapologetically (and, probably, unwanted) expressed my opinion. Why? Because, frankly, I was shocked.
The person representing the organization clearly didn't understand the serious implications of a given indemnification clause for the writers the organization advises. The person actually wrote, "In my [publishing] experience ... this clause is pretty standard and puts the onus to get things correct on the writer." Here's the clause in question:
Each Party hereto shall indemnify, defend, and hold harmless the other Party, its editors, officers, employees and agents with respect to any claim, demand, cause of action, debt or liability, including reasonable attorneys' fees, to the extent that it is based upon a claim that, if true, would constitute a breach of any of the indemnifying Party's representations, warranties, or agreements hereunder.
Two things concerned me. The clause, specifically, has the dangerous phrase, "based upon a claim that, if true
[emphasis mine], would constitute a breach."
In other words, the writer needn't have done anything wrong to be at risk. So long as someone brings a legal claim or action on a ground that would indicate a breach of the writer's warranties (covered in a separate clause), then the writer takes on the financial obligations of the publisher - even if the publisher decides to settle with the litigant. That means the publisher could make a decision to settle the issue and the writer, even if in disagreement with the action and contesting any wrongdoing, would be left to cover the costs not just of the financial settlement, but of the publisher's legal costs. This could happen even if the writer did nothing. Even if a court would not have compelled the writer to do so. Even if the publisher was lax in its own review.
Although I'm flexible in negotiations, an indemnification clause worded in this or similar manner is one of my true deal-killers. I've warned hundreds of writers personally, and heaven knows how many in seminars and panel discussions, about the implications of such wording. However, someone from a writers' organization, who clearly didn't understand those implications and, clearly, with the best of intentions, was inclined to give advice suggesting that the clause was one of those things that writers must bear.
The second aspect that bothered me was that the person from the organization was so ready to take on the view of a publisher. Granted, this person actually had spent considerable time working at a publishing company, but when you are trying to represent the interests of writers, that point of view must go out the window, because you have to think about what is best for the writers and how to help writers push back on terms and practices that are unconscionable. Here's part of one of my responses through some back and forth:
Also, in general indemnification clauses are, of their nature, unfair to the writer. You almost never see the publisher indemnifying. A lack of an indemnification clause doesn’t mean that the writer is any less on the hook. It does mean, however, that the court doesn’t have a say as to whether the particular circumstances in a case actually warrant the writer taking on the financial burden, or if the publisher was significantly at fault as well. Also, the publishers have insurance, particularly important if someone decides to sue even though there isn’t anything wrong the writer did. If there is indemnification, then there is an incentive for the publisher to settle, no matter what the merits, and expect the writer to cough up the expenses, including the publisher’s own legal expenses.
The reply? "If they can be struck, sure, do that. But most publishers insist they be retained..."
However, that's not true. There is flexibility among many publishers, whether producing materials for online, books, or magazines. I’ve seen writers get such clauses struck, or at least modified to get rid of such things as the "if true, would constitute a breach" language, or by properly inserting language like "if such decision is upheld in a final court of appeals." If you’re providing contract assistance to writers, you need to be able to give a close read that immediately sees such problems jump out at you.
I'm not mentioning the organization in question, because it doesn't matter, as the problem is inherent in the free review system that writers have come to depend upon, and that many unfortunately use as a substitute for their own judgment. When you're getting non-legal advice on contracts, you want to tread warily. Never assume that the person answering necessarily knows enough to hand out advice. Although the people generally have the best of intentions, it's very easy for them to suggest something that could return to bite you. Think that writers don't get sued and that indemnification doesn't happen? Here's a bit of something that my colleague Sue Russell, a long time advocate for writers and someone who also served on ASJA's contracts committee at the same time I did, once wrote about the need for media perils insurance:
Mike Mansel [who is a sympathetic insurance agent very familiar with writers’ problems] and his company assert that it’s not just true crime writers who should be aware of liability issues but even the authors or self-publishers of cookbooks and maps, as publishing expands into new worlds (audio books, e-books, POD, the Internet, etc.). Mansel’s site says:
“Unlike traditional claims involving allegations of libel, invasion of privacy, copyright infringement, piracy and plagiarism, errors and omissions claims seek to impose liability on the publisher for physical injuries or economic loss allegedly caused by some flaw or negligent publication in the ideas or expressions contained in the published material.
“Publishers of "self-help" or "how-to" books are particularly vulnerable to these types of claim, and suits have been brought successfully against publishers of cookbooks, books on toolmaking and metalworking, medical text books, diet and exercise books, books on herbs and wellness, maps and charts to name just a few.”
In other words, if you think you're safe because you're not controversial, think again. And if you assume that some organization, no matter the reputation, will give you sound advice, then you're a law suit waiting to happen. You don't know exactly who is handing out the advice. Has the person received any training or done any extensive research into the topic? Or is the organization grabbing whatever volunteers there may be because the "service" is at least as importantly to the organization or person a public relations outlet? Are you getting advice from someone who is such a principled activist that the person suggests walking away from this, that, or some other contract, even if there are ways of making the contracts workable for someone - you - who has to make a living?
Again, I'm not mentioning names because this isn't about one organization or individual or another. It's about the trouble you can find when you rely on the kindness of strangers, no matter how sympathetic or certain they might be. Educate yourself, and remember that no matter who claims to be helping, you always have the greatest interest in your own welfare. Look after it by arming yourself through education on publishing law, contracts, and negotiation.
Labels: contracts, review