Friday, January 09, 2009

Vanity, thy name is option clause

The author was ecstatic. Not only had she been offered a publishing contract, but they wanted her next two books as well! Oh glory! Whoo-hoo!

Slow down.

I made her a cup of my amazing fresh-brewed coffee with lemon zest, and I convinced her to sit by the fire at Booklab a minute and take a breath. Yes, it sounds flattering when a publisher includes mention of your future works in a book contract. But dear author, this is what is known as the dreaded Option Clause, and it always benefits the publisher, not you.

The clauses are generally written in tricky ways. You usually have to show your publisher your next work of the same genre (for example, your next work of nonfiction), and give them right-of-first-refusal. Doesn't that sound innocent and also flattering? It does, but it isn't. First of all, it gives them a chance to bid on the book with no competition, so they can "buy" you on the same terms as your first book, even though presumably you're worth more on book two if you are angling your career the right way. Second, it prevents you from shopping book two around when it is in the earlier stage of proposal and sample chapter, a stage at which many publishers may want to give you a deal. This option clause won't be satisfied if you show your current publisher that same amount of work -- you still owe them a look and a bid on the whole manuscript. The overall effect is one of squelching healthy competition.

There is an old gentleman's agreement in New York publishing (although it is rapidly falling by the wayside along with such niceties as job security) that says if authors are bound by option clauses to publishers even in a manner that they can technically wriggle out of, other publishers won't bid. The general thought was -- and sometimes still is -- that you should satisfy your obligation to the publisher by producing the books that the option clause stipulates before you are free to go elsewhere, and other publishers would expect the same, so they back off. Would this hold up in a court of law? Of course not, but publishers know that turnip-poor authors aren't usually going to go crying to the judge over such matters. They can't afford to.

There are two ways to handle an option clause if you don't have an agent. The best way is to get the publisher to strike it out altogether, and if you do, that's a complete victory. Then the publisher can bid just like anyone else for your next book. But most publishers won't do this, and unless you are valuable and they're nervous about losing you, I don't blame them... why would they? What you usually can get, however, is a time limit. I prefer sixty days, but you can negotiate and perhaps settle at ninety. Once you close the loop by giving the option clause an expiration date, you at least render it into a gentler thing, if not completely harmless.

The book image above comes from the University of Nebraska Press.

No comments: