View Full Version : Tell me about non-disclosure agreements
11-03-2006, 10:26 PM
I have a friend desperately trying to get some books out of contract with a publisher. The publisher wants a non-disclosure agreement about the tiff between them in order to release the books.
There's a five figure fine for breaking that non-disclosure, is that normal?
Is it normal to require a non-disclosure agreement in this kind of case?
When does a non-disclosure clause go into effect? What if the business has already been disclosed to a few people?
I have of course, directed the friend to a state attorney for the arts office, but that might take some time to get together, pending that does anyone have any anecdotal orpersonal experience advice for this?
Wow, that must have been some tiff.
Marketing your book is hard enough without piling up agreements.
It should be easy enough for your friend to keep his mouth shut but it means the publisher will always have that leash on him.
I'm not desperate to be published so I'd tell the publisher no thanks, especially since there is apparent friction already. If the work is good then he will find another publisher. If he is worried that he may not then maybe a tube of super glue for lips and sign on the dotted line.
11-03-2006, 11:03 PM
I'm sorry if it wasn't clear, but this is to get books OUT of a prior agreement with the publisher. The publisher said one thing to the author and abides strictly by the contract which says another thing altogether. The books are not being released when the author feels they should have.
So it's not a disagreement about being published in the first place, but a disagreement after the contract is signed to get the books free from the contract.
11-03-2006, 11:05 PM
Personally, I'd want an expiration date on the NDA. After so many years, it should all be under the bridge anyway. Don't know if it has one, but that's the one bit I can point to.
11-03-2006, 11:27 PM
hmm... I'd think there should be something in the contract to dictate how one would break said agreement.
but I'm not sure about "not being released when the author feels they should have" - publishing houses often move books up and down their release schedule, IIRC... so what's that all about?
Ol' Fashioned Girl
11-03-2006, 11:47 PM
We aren't talking about PublishAmerica, are we?
11-03-2006, 11:57 PM
We aren't talking about PublishAmerica, are we?
No, but I won't say who.
11-04-2006, 12:20 AM
PA sent us a release with that clause in it and we told them what they could do with it. Later we got a "clean" release!
Don't sign the damn thing! I'm not a lawyer...and this is not legal advice
11-04-2006, 12:32 AM
I woudn't sign it. Really, I wouldn't. Can your friend talk to a publishing lawyer? An attorney who mostly works with author/publisher issues and contracts? It's worth a couple of hundred to get an informed opinion on something like that.
If said friend does sign it, it should have an expiry and it should be mutual, but really, I wouldn't sign it.
Oh, tough one. A contract is a contract. It is hard to break one strictly from discontent. I don't have publishing experience yet but a similar situation exists in manufacturing. A manufacturer would offer a contract on a design promising attractive royalties. In reality the design was never produced because the intent was simply to keep the idea from market so it couldn't compete with an existing product. The designer could never collect royalties on an un-produced item but nor could he take it elsewhere. Since the contract offered him no out the designer was stuck.
A smart contract has either a guaranteed release date, or stipulates that the manufacture will pay designer a minimum annual payment as a draw against royalties or both. This way a manufacturer HAS to produce, pay, or rescind the contract.
I was thinking of this a few days ago regarding publishing. If a publisher fails to go to print or goes out of business, the writer has lost many years. If there was no advance the writer is completely out in the cold.
There should be something in a contract that will guarantee a writer payment for unreasonable lost time or a cancellation clause.
If no money has ever been passed there may be a chance that the contract was never actualized. Sort of like consummating a marriage. This is certainly an issue for legal beagles.
11-04-2006, 06:27 AM
I've no idea what the situation is here, but there are three characteristics of good NDAs:
1. A time limit.
A Symmetrical NDA is kinda important in these things. If the NDA says the HE isn't allowed to speak on the subject, but the publisher still is, then there is a problem.
Publisher: "Well, the main problem was that the author was 3 weeks late"
Author: "No I wasn't"
Publisher: "Ah hah - you aren't allowed to say that! You are under an NDA."
3. A statement that you are still allowed to discuss information that is in the public domain - if that information got to the public domain not through a breach of yours.
Under the law around here , the last one is implicit anyway. When the British government tried to stop an ex-spy talk about his experiences in his autobiography, they tried to get him by pointing out he had breached his NDA. However, all the stuff he'd discussed was already public knowledge - so they failed.
Just some thoughts - never take ramblings on the internet as legal advice.
Just a few general comments (not legal advice for any particular situation, including the one that started this thread): The "five figures if you breach the NDA" is usually referred to as "liquidated damages." The point is to prevent the nonbreaching party from having to go to court and prove up damages, which are notoriously difficult to litigate and depend far too much on whether the trier of fact has indigestion from bad bagels at breakfast.
As a general rule, liquidated damages clauses are themselves of dubious enforceability, particularly when they are founded on strict liability. They can't be ignored, but neither are they iron-clad; they're more worthwhile as a deterrent than as a remedy, except in certain commercial contexts in which the liquidated damages are usually based on time (and not actual conduct).
Except if there is blackmail or other unlawful conduct at issue, there is no excuse for an NDA requirement upon mutual termination of a publishing contract.
That said, E&O policies usually require publishers to put an NDA clause into terminations that are not on the basis of nonperformance of the underlying contract, or the insurer will neither cover nor defend the publisher for anything even remotely related. This is at least in part a relic of the McCarran-Ferguson Act, but going that far into legal history and doctrine may be a bit much...
Any NDA (or other noncompetition agreement) that does not have a reasonable sunset will be held unenforceable, as does one that unfairly prevents an individual from engaging in his/her chosen trade or profession. In most states, an NDA/noncompetition agreement that lasts more than three years will not be enforced; neither would one that says that a dentist can't start his own practice within a 50-mile radius of the practice he's leaving (that's a rather famous/notorious case in basic contract law). Many states, including both New York and California, have explicitly incorporated their common law concerning noncompetition agreements into their law on NDAs.
None of this is going to matter in the end if the publisher insists that the NDA is a dealbreaker. Many of them do; most of the time, they're bluffing, but the more sleazy the publisher the more likely that it really is a dealbreaker. There's not a very high correlation, though, so remember that "more likely" is merely observational and not formulaic.
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