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Triskelion Bankruptcy Update: Contract Clause

DISCLAIMER: Just to CYA, I feel like putting up a disclaimer. There is much that I don’t know about the Triskelion situation and any discussion regarding the law and the legal issues surrounding copyrights and publisher bankruptcies are general and not to apply to any one particular situation. If you feel like you are in a position where you, personally, need to apply this information to a case, you should seek a lawyer right away. My posting of my thoughts regarding the legal issues surrounding this matter or matters similar should not be construed as specific legal advice nor does it create an attorney/client relationship.

Edited to add: The following contract clause is known as an ipso facto clause and generally held to be invalid by bankruptcy courts.

I was provided this and wanted to share it with the authors. This should be in your contract. Utilize it to protect your rights. Please note that this is no guarantee of a reversion of rights but if you don’t take action now, you might be in worse shape. I would not only send an email but a certified letter showing proof of mailing. Always keep a copy for your records.

If the Publisher is adjudicated as bankrupt or liquidates its business, this agreement shall thereupon terminate, and all rights granted to the Publisher shall automatically revert to the Author.

Upon such termination, the Author, at his or her option, may purchase any remaining book stock for any print edition (not including electronic downloads or print on demand editions) for one-half of their manufacturing costs. The Author must exercise this option within sixty (60) days of notice by the Publisher.

I would think that authors would want to send notice to Kristi now before Triskelion files for bankruptcy on July 2nd. Further, authors may want to advise your readers to stop buying the books at Triskelion since any money Triskelion now intakes will be distributed by the trustee and the authors are not likely to see that profit.

Also, if authors do decide to obtain a lawyer, I would do so as a group. The costs could probably be defrayed since all the authors have the same contract and thus the same legal issues. More information to come later.

Jane Litte is the founder of Dear Author, a lawyer, and a lover of pencil skirts. She spends her downtime reading romances and writing about them. Her TBR pile is much larger than the one shown in the picture and not as pretty. You can reach Jane by email at jane @ dearauthor dot com

32 Comments

  1. Maya Reynolds
    Jun 20, 2007 @ 18:08:41

    Are we sure that Triskelion hasn’t already filed? The notice on their site simply said they’d be closing their doors on July 2. I would have expected that they would have filed before posting that notice.

  2. Jane
    Jun 20, 2007 @ 18:14:21

    My understanding is that they intend to file on July 2, 2007, and that is what they informed their authors today.

  3. Maya Reynolds
    Jun 20, 2007 @ 18:32:16

    Thanks, Jane.

  4. Angie
    Jun 20, 2007 @ 19:56:02

    I had deja vu, lolol.

    That’s our clause, so it would probably read somewhat different in the Trisk contract, as every publisher uses varying language. But hopefully there’s something that looks like that in the Trisk contracts. In all the publishers’ contracts, really.

    It’s like the audit clause, you hope like hell you never have to use it, but you still want to make sure it’s in there.

  5. Jane
    Jun 20, 2007 @ 20:02:13

    Angie – that was what was emailed to me by someone who has had possession of a Triskelion contract.

  6. Angie
    Jun 20, 2007 @ 20:05:52

    lolol, sorry! I just remembered posting it below but didn’t realize you had this post up. I’m glad to know it’s in the contract, though!

  7. former trisk author
    Jun 20, 2007 @ 20:22:42

    Also, keep in mind that Triskelion has had at least four different publishing contracts since it opened its doors. An author might have different protections or moves to make depending on which contract she signed.

    So read those bankruptcy clauses carefully…though the bankruptcy court will likely still treat these “frozen” contracts as company assets to liquidate.

    I am so sorry for everybody caught up in this mess.

  8. anony2
    Jun 21, 2007 @ 03:56:14

    Just a few questions…

    What leads anyone to believe that a contract with Triskelion is worth the paper it is printed on?

    Ms Studts did not communicate with you when she needed you, why would she deign to do so now?

    So what if your contract is breached? Where is your compensation going to come from?

    A wise man once told me that “a good deal with a bad guy is a bad deal.” We may write about romance but it’s time to put the business cap on and leave the romantic notions behind.

    Triskelion Publishing burned through someone’s money with big promises and nothing to back them up. You were warned months ago and anyone who stuck around deserves what they (don’t) get.

    Oh, and where are those “Triskelion is a family” folks now?

  9. Maya Reynolds
    Jun 21, 2007 @ 05:49:57

    Anony2: Those aren’t questions. Your post is pure schadenfreude.

    The closest we can come to an English equivalent of schadenfreude is “taking pleasure in someone else’s misfortune.” In other words, malicious glee.

    You can dress it up by pretending to be business-like, but what you’re really doing is crowing. It’s unattractive and petty and explains your “anonymous” tag.

    I’m not a Triskelion author, but I feel sorrier for you than I do for them. They will move on. You’re stuck inside the skin you inhabit.

  10. Ann Aguirre
    Jun 21, 2007 @ 07:01:01

    I’ve been through a similar collapse, although in NBI’s case, the CEO just absconded, and didn’t have the courtesy to file bankruptcy or handle business officially. Poor Lynne went through that one as well. It made me extremely leery of dealing with epubs for years afterward.

    My sympathies go out to the authors. Some may have seen the writing on the wall, but desperately wanted to believe in the best outcome because the worst would sink so many of their dreams. It makes you feel heartsore, as if you’ve been wasting your time with this company. It also makes you doubt yourself. If these people don’t know what they’re doing in a business regard, how can their decision to publish my books reflect well on me? Maybe they would publish just anything. This is a real blow, and I’m sorry for the folks going through this mess.

    As for you, anony2, “just a few questions…”

    Yes, the authors are probably screwed for royalties. What difference does it make to you? Did these “Triskelion is a family” authors come to your house, pee in your cornflakes, and kidnap your dog? What kind of person kicks someone when they’re down?

  11. Ciar Cullen
    Jun 21, 2007 @ 07:49:08

    Yeah, what Ann said. I’m a former Triskelion author and was very new, very confused, and overwhelmed when I left a few years ago. Some people perhaps don’t have the business background to see trouble coming, and believe what they are told. You can call them stupid or naive, but it’s really low to do so. Why blame the authors? ‘You were warned months ago’? My God, we all get warned about every freaking company on a regular basis, don’t we? Cut them a break instead of kicking them when they’re down. This is hard, especially for new writers. I had a very, very bad ending with Triskelion and I’m not taking any delight in this, because of the authors, my colleagues, no matter what company they write for.

  12. Terese Ramin
    Jun 21, 2007 @ 08:44:17

    Perhaps anon2 has already been kicked by all and sundry over this same publisher before because s/he recognized a lack of professionalism by the publisher a long time ago and tried to blow the horn and help other authors but was instead abused and derided by the same authors who are now lamenting their own fates. That would lead to the question of “where is this Triskelion family now?” Perhaps that’s why anon2 wishes to remain anonymous – because s/he’s had enough of being kicked – which is exactly what y’all are doing here again just because anon2 hasn’t yet learned how to practice containment (which would be wise for us all.)

    Kicking, biting, back stabbing, denigrating our fellows for bitterness or any other emotions whatever in this situation simply feeds the machine that was Triskelion. Stop it now. Everyone was injured. Everyone feels what she or he feels. Each of us are entitled to feel what we feel and if this forum allows the comments, allows the kind of comment not only anon2 made but that each of you made in response, then…each of us – each of you should be entitled to state how you feel without fear of being stamped on – or judged – by your peers. So quit it.

    Period.

  13. Doreen Orsini
    Jun 21, 2007 @ 08:44:26

    I still will say we authors were like a family. I will add that not one of us considered the publisher our momma. LOL We were sticking up for one editor and the authors. Also, many authors have asked for rights back over a month ago with no response. My take on this? I’m not surprised it folded but, foolishly, had expected that bankruptcy clause to protect me. Anony2 is being cruel and spiteful, but I have no feelings about her/him. I care about the newest authors at Trisk. Those authors got their dreams and, before seeing their books released, lost the rights to those books! How very sad. I will fight for Hunting Diana and Tanner’s Angel, but I will move on and write the next book. What is not surprising is a non-communicative publisher has stated she will not answer emails, etc. until 10 days after the filing. Of course, this in effect breaches all contracts with the Cure Period clause stating they must respond in 7 days. Also, the Bankruptcy Court allows only 15 days after filing for creditors, etc. to come forward, so Triskelion is trying to leave us out of that loop. As one who never saw a penny from my paperback, I am a creditor, right? Does anyone know if that makes using my contracts as assets illegal?

    To my Trisk sisters out there…yes, we were a family and we will get through this together!
    Doreen (who is just trying to sort throught this mess)

  14. Doreen Orsini
    Jun 21, 2007 @ 08:51:17

    One more item. As Terese stated (Hi, Terese!), there were authors who warned and were kicked. I’d like to think I never kicked anyone, but I did stand up for Trisk and actually brought some people into the company. For that, I am even more sorry. I feel responsible for anyone stuck in this mess because of me. My deepest apologies.

    As for those who tried to warn me…what can I say? I tend to believe people will do the right thing. Those rose-colored glasses were glued to my face. I have since ripped them off and replaced them with pale pink, not clear.
    Doreen

  15. anony2
    Jun 21, 2007 @ 09:44:20

    I would like to apologize to any author who feels I kicked them when they are down. That is not my intent.

    There is certainly enough “sympathy” to go around. It’s time to get real, learn from the mistakes and move on.

    Actually yes, the “Triskelion is family” folks DID pee in my Corn Flakes (they are welcome to the useless dog). It is time they are held accountable. I applaud Doreen for her post. (and Maya can… well, never mind)

    There are hard working, honest people in this business who are belittled for being small and up and coming by the “high flyers.” When the truth about the “high flyers” comes out, it is important to set the record straight. That is my intent.

    The milk is spilt. There are several good farms for the ebook romance author out there. Go find them.

    The thinking author will read my comments and be stronger. But you can bet there are folks emailing Gail Northman right now asking where she is going to work next.

  16. Lynne Connolly
    Jun 21, 2007 @ 09:55:43

    I have always done what I said I would. I made it clear to the management that if Gail N left, so would I, and I did so.
    I play it straight and I expect others to do so too. If they don’t, it’s their conscience, not mine.
    I did get some rights back, and there are still a few books left in the mess. Two, to be precise. I love those books, and I recently got rave reviews for them, so it’s sad to see them languish in the slough of the bankruptcy courts.
    I think Triskelion could have rallied after Gail left, but it floundered instead, which is very sad, and one reason I left some books there.
    I do not backbite, and I do not kick people when they’re down. And for me, the author is paramount, so anyone who thinks that a good way to get back at a company is to kick the company and their erstwhile colleagues has lost my respect. But then, they don’t care about that, do they?
    And one more thing. I did see some authors leave the company because of very poor sales, who then turned around and lashed out. Present company excepted of course!
    Sometimes a publishing company just doesn’t fit well with a certain author. No one company can be everything to all authors. For instance, the historical line at Triskelion never did very well, despite some really good books. So earlier this year the decision was taken to cut it. It wasn’t anyone’s fault, just that readers of historical romance weren’t going to Triskelion for their historical fix. Some authors took this very badly, some with good grace, and the editors tried to help them to find alternative homes for their books. It was better all around. Authors could take their books to publishers who would give them better sales, and Triskelion could refine its lines down to the ones that worked well.
    So don’t believe everything people tell you.
    The truth is, and I know some people will refuse to believe it, but there you go, after Gail left the company was left without a visible leader or any direction. Gail left for family reasons, but no one really replaced her. The authors loyal to Gail felt they wanted to leave, but there were a lot of really great authors left there. Now I believe there are a lot of debts and a big mess that nobody has really thought through properly.
    Play with a straight bat and you won’t have to hide anything from anybody.

  17. Rebecca Goings
    Jun 21, 2007 @ 11:58:26

    I am very saddened that some of my good friends in the business have had their dreams stepped on in this snafu. Like Ciar (and Lynne), I am a former Triskelion author, who’s book was released from contract due to “poor sales” only 5 months after the book was released. This left me with a “bad taste” in my mouth regarding that particular book, and it took me almost a year to re-submit it to another house.

    Gail was always a sweetheart, as well as Terese (how you doin’, woman?). I believe the authors were more loyal to Gail than to Kristi, and when Trisk lost that “foundation”, the entire house collapsed upon itself. I can’t say I’m surprised, but I am saddened to see this happen.

    To those who’ve been hurt by this whole ordeal, I wish you well, and may your newly orphaned books find new homes. That is, if you can retain the rights to your books. When New Age Dimensions folded, we were given our rights returned (in writing). Holding on to the rights at this point for the duration of the signed contracts would seem to be the final “finger”, if you will, to all involved. Let’s hope the publisher takes the high road on this one.

    ~~Becka

  18. Ann Aguirre
    Jun 21, 2007 @ 12:13:39

    It is time they are held accountable.

    Held accountable for what? Being overly optimistic? Failing to heed other people’s good advice? Posting stuff on the Internet that made them look foolish?

    See, here’s the thing. None of those are criminal offenses. If they were, most authors would’ve been locked up years ago.

    Even if those authors did you wrong, my advice to you: move on. Holding on to old grievances, real or imagined, just weighs you down. Now whether you’ll take my good advice remains to be seen. After all, who am I to be giving someone I don’t know advice? And that’s just the way these authors you seem to be mad at felt about your warnings, I bet.

  19. Linn Random
    Jun 21, 2007 @ 13:39:11

    When I signed on with Triskelion, I thought I had found a home for life, I was even one in the “inner circle” for a while….then The Troubles began and eventually I was given my rights back, I had to fight for them, no easy thing but back they are. On the side of heaven, I learned to more carefully read a contract. I can tell you this, every Triskelion Author will become stronger for it. Of all the things that can be said Triskelion worked with a brilliant group of authors, no doubt in my mind, each one will find a new home. Hi to so many of my “olde” and dear friends who I remember from the early days. We were the ones who put Triskelion on the map, I’m still humbled by being with this elite group. Thank you Dear Author ladies for giving those a place to grieve a safe place to cry, for giving those who need to shout in anger a safe place to scream about the unfairness of it all. To the Triskelion Authors, stand proud, this is but a bump in the road on your magical journey. Great and exciting things wait for you. Believe in yourselves, your great novels Always Your Friend, Linn

  20. Cathy Clamp
    Jun 21, 2007 @ 14:58:04

    I wish I had better news for you who shared this contract clause. Unfortunately, you’re going to discover that the U.S. Bankruptcy Code doesn’t recognize this clause in ANY publishing contract because every contract, every book, is considered an asset of the company, and all assets are frozen upon filing. The contracts can be sold to benefit the creditors, so nothing can happen until the creditors are paid. Up to this point, authors haven’t been considered secured creditors under the terms of the Code, nor has the Court allowed authors to resell the rights to publish while the bankruptcy is open. Yes, every publisher puts in this clause, but it has no teeth, because it’s out of the hands of the publisher. Once they file under one of the Bankruptcy Code chapters, they’re subject to those rules until AFTER the bankruptcy file is closed.

    PLEASE, anyone who didn’t get their rights back NEEDS to contact a publishing attorney. At the very least, purchase the back issue of THE BULLETIN I mentioned in the earlier thread. It’s Issue #170, Summer, 2006. You can find it on the http://www.sfwa.org site.

  21. Jane
    Jun 21, 2007 @ 15:00:39

    It’s an ipso facto clause and considered invalid unless you have an executory contract, which most authors do not. This will be the subject of my Sunday article and I would say that anyone who got their rights back in the last 90 days should be seeking counsel in Arizona as well. (Arizona being where Trisk will file its b-ruptcy action).

  22. Lucynda Storey
    Jun 21, 2007 @ 19:26:02

    Ann,

    Trisk made a lot of promises to people, promises with conditions that they didn’t reveal like having a minimum presale order of 1000 copies. Trisk didn’t tell any of us that their distributors weren’t paying them, didn’t tell any of us that the books they said were going to print were in actuality not going to print, didn’t pay when the contracts said that we’d be paid, arbitrarily changed clauses in the contract rather than having authors sign an addendum. Trisk should be held accountable for the hundreds and thousands of dollars authors spent on promoting for print books that were delayed without notice or not printed at all. Good faith is a concept even in legal circles. Authors acted in good faith while in many instances Triskelion did not.

    That causes a lot of hurt feelings which leds to anger and bitterness, emotions these authors are entitled to.

    Kristi Studts stated in the print author loop that they sold half a million dollars last year, that they were closing in on Dorchester, stated that they were scaling back on print books because ebooks were the bread and butter of Triskelion. Yet, three months later she’s saying they are totally broke, broke so badly they can’t even reorganize.

    A lot of authors rightfully asked, “Show me the money!” and when they insisted on knowing the number in the print run, which is not top secret information, they were kicked out of the loops and their books removed from the eStore. Asking about your expired contract and then requesting the rights back after expiration resulted in having all your books removed.

    How much was illegal? We probably won’t know until the proceedings are over. How much was poor business? A lot of that we can figure out. How much was just plain ol’ poor treatment of the people they are now considering their assets??? Over SIXTY authors know the answer to that one too, even the ones who tried their hardest to give Kristi and Triskelion the benefit of the doubt.

    Anon2 is correct when s/he says that Kristi didn’t communicate before why should she now. Anon2 is correct when s/he says that the handwriting was on the wall long ago. Anon2 has a right to post what s/he said because s/he was affected by the actions of Triskelion. Anon2 is correct when s/he said others tried to warn authors that things in the business weren’t kosher and several of the warning authors took a lot of heat for those warnings.

    I don’t know if you were a Trisk author Ann, but a lot of us were kicked and hard. I had my issues last summer, and in January of this year so when all this came down I wasn’t as emotionally affected. Now authors are scrambling to figure out what to do because they had their faith in Kristi and Triskelion ripped out of their hearts. And yeah, if there were a way for those writers to hold Triskelion responsible for their crushed dreams and wasted money, I’d be all for it.

  23. Doreen Orsini
    Jun 22, 2007 @ 08:37:13

    In regard to the authors who received their rights back within the last 90 days. I’m only thinking with common sense and not knowledge of the legal system, but….I would imagine that those authors who have proof rights were returned because such return was requested by the author can prove it was not “Asset Dumping.” Ok, I have that proof with No One But Madison. When I was informed that No One But Madison would not go to print, I wrote and asked for the rights to that book and Hunting Diana back. I got No One But Madison. If you have an email, etc. proving that you requested your rights and that they were not just handed back, then hold onto it. As far as I’m concerned, No One But Madison is mine to sell to whichever publisher I choose. As for Hunting Diana, I’m fighting to get those rights back.

    One point I would like to make about Lucynda’s post: There was mention that the vendors were not paying. That was the reason I received everytime I asked about sales, royalties, etc. “Borders hasn’t paid since August of ’06″ “Ingrams hasn’t paid us so we are moving to Aero.” Yada yada yada. Were they lying? I’d like to know from Borders and Ingrams if they were or weren’t. I’d also like to ask anyone who has emails or copies of ims, etc. where they were told the same thing to let us know.

    Doreen

  24. Trista Bane
    Jun 22, 2007 @ 08:47:52

    I found this link on a loop. I was in shock to hear the news about Trisk, and decided to come read this. My original intention was not to leave a comment, as it seems this is a place for Trisk authors to express concerns and lean on one another. However, when I read Doreen’s comments, I felt I had to say something.

    I purchased a print copy of HUNTING DIANA back in February. Doreen was kind enough to come to my birthday bask at my loop and share excerpts. She hooked me, and I purchased it immediately! I loved the book. Read it from cover to cover– almost without stopping. I even skipped a meal– I was so obsessed. I don’t know if I ever told her that. And, it infuriates me that she may never receive payment for it. And it saddens me that she will have to fight for her rights back to a book that she obviously put her heart and soul into.

    And so– for Doreen– and all of the other authors who are affected by this horrible ordeal, my thoughts and prayers are with you.

  25. Joanna K. Moore
    Jun 22, 2007 @ 10:45:49

    I received all my rights back in writing on May 18th. Today, I feel like I dodged a bullet. I’m at Wild Rose Press now, with both my books. I feel so badly for everyone whose rights to their books are now tied up in the mess. Egads.

    Hugs,
    Joanna

  26. Joanna K. Moore
    Jun 22, 2007 @ 18:57:39

    Well, now I know that my written release, requested by me and received in writing on May 18th, may be deemed worthless if the courts rule that way. This whole situation is just beyond words.

    Joanna

  27. Linn Random
    Jun 22, 2007 @ 19:21:54

    Joanne, take heart, unless you actually spoke with an Attorney, you don’t know. As I suggested earlier, I found a lot of attorneys who would do a free consultation. Try that. Hope springs eternal, I don’t think Trisk has actually filed the paperwork yet..so maybe there will be a reversal. Maybe another publisher will jump in and buy up their debts. And of course you don’t know the outcome of any bankruptcy, I doubt if Visa/Master Card who ever are the creditors are likely interested in going into the publishing business, so your rights might very likely come back by default anyway. Chin up!!! And I’ve talked with a very smart Trisk Author today who said, in time she will get her rights back, in the meantime she’s focusing on her current wip. How brilliant! What a great outlook in the midst of this. Hang tight and once again, our thanks to Dear Authors who are most dear in allowing us to come together here. Linn

  28. Joanna K. Moore
    Jun 23, 2007 @ 11:45:13

    Linn, you are right. Whatever happens, I can handle it. Onward to a new project, with my head held high.

    Joanna K. Moore

  29. jaq
    Jun 23, 2007 @ 16:04:04

    I just recieved the latest RWA News alert in my inbox:

    RWA contacted its attorneys on behalf of authors who are under contract with Triskelion. After reviewing a sample contract that Triskelion submitted with its application for RWA recognition, the attorney advised that the best options with respect to the Triskelion contract are:

    i) Authors whose books have not been published should send a notice that the contract is being terminated based on Article III, section L that voids the Agreement if Triskelion has not published and made available for sale the manuscript within sixty (60) days of the agreed-upon release date, which is in Article III, Section A;

    ii) Authors who have not received advances that are set out on the contract should send notice as specified in Article VI, Section B that addresses breaches of contract. Authors should state that the Contract will be terminated in 30 days unless the breach is cured;

    iii) Other authors should send notice to request Triskelion to release them in writing from the Agreement.

    Correspondence should be sent immediately by certified mail or other receipted delivery service. Authors need to be aware that even if Triskelion grants the termination of the Agreement, such action may be voided by a court-appointed trustee if the publisher files for bankruptcy.

    RWA Board of Directors

    My sympathies to all Trisk authors.

  30. jaq
    Jun 23, 2007 @ 16:07:53

    I just recieved the latest RWA News alert in my inbox:

    RWA contacted its attorneys on behalf of authors who are under contract with Triskelion. After reviewing a sample contract that Triskelion submitted with its application for RWA recognition, the attorney advised that the best options with respect to the Triskelion contract are:

    i) Authors whose books have not been published should send a notice that the contract is being terminated based on Article III, section L that voids the Agreement if Triskelion has not published and made available for sale the manuscript within sixty (60) days of the agreed-upon release date, which is in Article III, Section A;

    ii) Authors who have not received advances that are set out on the contract should send notice as specified in Article VI, Section B that addresses breaches of contract. Authors should state that the Contract will be terminated in 30 days unless the breach is cured;

    iii) Other authors should send notice to request Triskelion to release them in writing from the Agreement.

    Correspondence should be sent immediately by certified mail or other receipted delivery service. Authors need to be aware that even if Triskelion grants the termination of the Agreement, such action may be voided by a court-appointed trustee if the publisher files for bankruptcy.

    RWA Board of Directors

    My sympathies to all Trisk authors.

  31. Sarah Grimm
    Jun 24, 2007 @ 06:38:19

    I hate to be the one to tell you this, but I have been told by a bankruptcy attorney that anyone who received their rights back within the last six months could still be in trouble. The bankruptcy court has the right to go back six months.

    Unfortunately that means that those who ‘saw the writing on the wall’ may still be caught up in this mess.

    This whole thing makes me sick.

  32. clicknpayday
    Apr 09, 2010 @ 14:17:45

    Friends are those rare people who ask how we are and then wait to hear the answer.

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