October 3, 2006
Why I’m Not A Bankruptcy Lawyer
The distinction I was missing yesterday when reacting
to the forthcoming Chapter 7 assets sale by the Byron Preiss book groups, a sale that includes several contracts, is that while people do indeed frequently have contract provisions allowing to take back their books in a bankruptcy situation, that's not necessarily the situation facing them here.
Cartoonist Henrik Rehr notes:
"In regards to the Ibooks contracts, I would assume that they do include a standard clause returning all rights to the creator in case of bankruptcy (at least mine on Tribeca Sunset does), but there is also another standard clause, stipulating that the publishing rights can be transferred to a buyer of Ibooks if the company is sold."
Rehr wrote in a subsequent note that it's his belief he could have enforced the clause if they had gone to Chapter 11, but not against the sale of the company's assets under Chapter 7, which is what's going on here.
Cartoonist and Publisher Nat Gertler points out:
"Your comment on the iBooks rights situation ('I'm suprised that with some of the big names involved that more of the contracts didn't include provisions for return if the publishing company went bankrupt.') misses one tricky point: such a provision would have dubious impact at best. A company in bankruptcy doesn't have the right to decide which assets go to whom, even if agreed on in advance. That's part of the bankruptcy situation.
"This is discussed with more precision (and by a lawyer, rather than just some publisher guy) here."
So color me less surprised upon hearing from these two guys.
Let me re-state I believe there may be precedent in place that regards book contracts differently than other assets in a way that favors the writers, and any comics authors out there concerned about the eventual outcome of this assets sale should look into what rights are available to them.
posted 11:15 pm PST |
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