This is one of the most interesting lawsuits in many years. The legalities are beyond me, but Harlequins actions seen shady, at best, and certainly appear unethical. Whether they're also illegal is going to be important for writers.
This isn't the first time Harlequin's done wrong to their authors. There was a time when the contract stated they owned the name the authors published under with them and they weren't allowed to sell elsewhere under that name.
It was one of the things that RWA took them to task about many years ago when the group objected to contracts. They got it changed, fortunately.
Harlequin also has a history of not filing the copyrights on the books for the authors. That's come up in a couple of the plagiarism incidents in the last 20 years. Don't know if they've continued that practice or not.
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