Contract Negotiation - More Red Flags

 

        I previously wrote about what I considered to be the biggest contract negotiation red flag -- a steadfast refusal to negotiate at all. Below, I’m listing a few more red flags that I look for in negotiations. If you encounter any of them, take a moment to think about how problematic it might be.

1) Won’t put it in writing

If a party makes a lot of promises to you, but they won’t put them in the contract, it is a major red flag. If it’s not part of the contract, it will be difficult, if not impossible to enforce, and if they’re unwilling to put it in writing, it’s a sign they might not mean what they say.

2) Urgency

If a party is pushing you to sign a deal quickly, then it is a red flag. Negotiations take time, and most legitimate businesses know this. If they are pushing for a deal to get done quickly it is (i) to serve their own agenda and/or (ii) to sneak a bad deal past you without proper vetting by an attorney/agent/etc.

3) Don’t know their own agreement

If a party is unable to explain the terms in their agreement to you, or if they don’t see how terms might conflict in the contract, it is a red flag. They either lack an attention to detail, or they are deliberately misrepresenting the deal.

4) Overly willing to make changes

This might seem counterintuitive, but a party that gives you all of your requested changes could be a red flag. It could be a secondary sign of the “don’t know their own agreement” red flag I mentioned above, or it could be that they just don’t care or don’t intend to honor the contract.

Comic Book Recommendations - 2021

 

            Another year is almost over, and once again, I’m going to provide a list of some of the creator-owned books I enjoyed this year. They may have been released in 2021; they may not have. As I stated in my 2020 list, I’m often woefully behind in reading. (Check out the 2020 list for some more great books.)

            I’ve provided links where I can. Links to Amazon will be affiliate links. Anywhere else is not. Even so, if you’re intrigued by these books, try to buy them from your local comic shop or book store.

 Chu, vol. 1 by John Layman and Dan Boultwood

I was a big fan of Chew, and I’m glad to have a return to its world. This time, it follows a sister of Tony Chu, the lead from Chew. While there are nice nods to the original series, this book stands alone and is easy to dive into for new readers.

 

The Good Asian, vol. 1 by Pornsak Pichetshote and Alexandre Tefenkgi

I’m a sucker for good film noir, and Pichetshote and Tefenkgi are nailing the vibe in this book. It’s an engaging read that explores some heavy topics around immigration and fitting in.

 

 Bowie: Stardust, Rayguns, & Moonage Daydreams by Michael Allred and Steve Horton

The initial attraction for me was the trippy Allred art, but Horton and Allred also craft an interesting and informative book charting the beginning of Bowie’s career.

 

The Department of Truth, vol. 1, but James Tynion IV and Martin Simmonds

A fascinating book exploring what would happen if false narratives became real.

 

Y: The Last Man, Book 5, by Brian K. Vaughn and Pia Guerra

I was incredibly late to reading this book, but it is excellent. The story follows the lone male survivor after a virus wipes out the male population on Earth.

 Murder Falcon by Daniel Warren Johnston

A surprisingly fun and emotional book with an interesting story and great art.

 

Black Magick: The First Book of Shadows by Greg Rucka and Nicola Scott

A solid detective/murder story following a police detective who is also secretly a witch.

Do Dr. Seuss and Fair Use (Comic)Mix? - Part 4

 

            It was recently announced that the lawsuit between Dr. Seuss Enterprises and ComicMix has settled.[1] I have been following the case since it began in 2016, and I’ve previously written entries about it. You can find the most recent entry, summarizing the Ninth Circuit overriding the lower court’s finding of fair use, here.

            In a filing with the court, ComicMix and Seuss agreed that ComicMix’s book Oh, The Places You’ll  Boldly Go! infringes on copyrights owned by Seuss, and ComicMix is prohibited from selling or distributing the book. ComicMix has stated that the motivation to settle the case was Ty Templeton’s recent diagnosis with cancer. ComicMix, and the other defendants, chose not to continue with the lawsuit so that Templeton could focus on getting better.[2]

            Five years after it began, the case is over. ComicMix prevailed on quite a few of the claims Seuss initially asserted, but after its initial fair use win was reversed by the Ninth Circuit, it decided to stop fighting. As I mentioned in a previous post, most companies and people don’t fight this long. It is time-consuming and expensive to do so. However, when these disputes do get litigated, it helps shape the law and provide guidance for others.

            What did the ComicMix case achieve? It showed that it can be difficult to prevail on a claim of trademark or trade dress infringement based on distinctive typography in a book. It clarified some of the fair use factors used to determine whether a work is a copyright infringement. Finally, it serves as a warning that mashing up two different properties does not automatically qualify as a fair use under copyright law.

            If you learn anything from this case, it should be to proceed cautiously when you are utilizing someone else’s work or character without their permission in your own work. Unless it qualifies as a fair use, it is likely copyright infringement, and if you want to claim fair use, you may have to go to court to defend yourself.

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[1] https://www.reuters.com/legal/transactional/seuss-comicmix-close-book-landmark-copyright-dispute-over-star-trek-mashup-2021-10-05/

[2] https://www.comicsbeat.com/oh-the-places-youll-boldly-go-lawsuit-settlement/

Halloween Costumes & Knockoffs - Part V

    Once again, it's the spooky season. I love Halloween, and as I've done the past few years, I'm going to point out some of my favorite superhero knock-off costumes on Amazon. You can find years two, three, and four at the links. If you want to re-read my first post that includes the legal whys behind knockoff costumes, you can find it here. Otherwise, on to the costumes! (Note: all links affiliate links)

Protect against Winter (Soldier) with this skin-tight top, or one of the other 20+ different superhero versions of it.

Help your child find their Glorious Purpose.

My daughter would actually like this Spider Gwenom.

Sexy Deadpool? Sexy Lady Deadpool? You decide.

A Wonderous Woman? Indeed.

Contract Negotiation - A Red Flag

 

            I’ve written a few times about contract negotiating power. However, I have not written about one of the biggest red flags I see when negotiating publisher agreements in the comic book industry—a publisher who refuses to negotiate the deal terms.

            I consider the refusal to negotiate a major warning. Your relationship with your publisher will never be better than when they are trying to get you to sign a deal. If they value you and your work, they should be willing to negotiate and address any major concerns you might have. If they are unable or unwilling to do so, then it reflects the value they place upon you. It is also a prelude to how they will act if anything problematic comes up later. If they didn’t want to work out problems with you at the beginning of the agreement, are they going to want to address problems you might have after the deal is signed?

            Now, not everything is an absolute. I have seen some publishers with relatively unproblematic contracts[1] who are not that flexible. They will try to address some concerns, but aren’t willing to budge on some key issues in the negotiating provisions. Again, this is less of a problem when the terms are relatively unproblematic to begin with. There are other publishers, however, who have incredibly problematic contract terms that essentially strip a creator of all rights to their project. If you try to negotiate the deal to make it fairer, they will tell the creator to “take it, or leave it.” In these instances, where a publisher will not even try to negotiate a fairer deal with you to address major concerns, you will almost always be better off leaving it.

            If you encounter a publisher that presents you with a contract that has terms you disagree with and the publisher refuses to negotiate or address your concerns, you need to give serious consideration to walking away. In most of my experiences, this is a major red flag and the relationship with the publisher will not improve.

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[1]     Most comic book publishing contracts are not that great for creators, particularly where payment of money is concerned. Nevertheless, there are some that are much more problematic than others when it comes to reversion rights and media deals.

5 Top Copyright FAQ's

Note: (Updated August 2021)

As an intellectual property lawyer who works with comic book creators and who hosts panels at comic book conventions, I answer a lot of questions about copyright law. As of August 2021, here are five of the most frequently asked questions.

1) If I place a copy of my work in an envelope and mail it to myself, does this give me copyright protection?

This is what’s known as a poor man’s copyright. It’s not a real thing. Once you have created your work, you own the copyright. Registering your work with the Copyright Office solidifies your claim of ownership and grants you some additional rights regarding enforcement.

2) How do I prevent someone from stealing my idea?

The answer to this question varies. The simplest way is to not tell anyone about your fantastic idea. The second best solution is to have everyone you tell about your idea sign a non-disclosure agreement, which can be burdensome and impractical. Typically, the best approach is to write down as much of your idea as possible in a detailed synopsis, outline, etc. This shows you have taken steps to actually turn your idea into a copyrightable work. If you do need to discuss your idea with someone else, either give them the synopsis you’ve prepared or, if you’re having a conversation and there is not an opportunity to get a signed agreement, don’t be as thorough in your descriptions. Additionally, it’s always a good idea to document who knows about your project.

3) Other people are making and selling fan art pieces, so it’s legal, right?

No. Just because others are violating someone’s copyright rights and not being stopped does not give you a free license to do the same. A copyright owner could come along at any time and enforce its rights through cease-and-desist letters, DMCA takedown notices, or lawsuits. If you are making and selling art using the intellectual property of others without their permission, you are likely infringing on their rights. Be careful. For more, check out my previous posts on fan art: Is Fan Art Legal? and Fan Art and Fair Use - An Update. 

4) If my work is 10/20/30% different than the original work I’ll be fine, right?

There is no set percentage that would make your work non-infringing. One of the factors courts look at is whether the new work is “transformative.” The Copyright Office describes transformative works as “those that add something new, with a further purpose or different character, and do not substitute for the original use of the work.”[1] Obviously, you will be better off with more differences between your work and the original work.

5) What about fair use?

As I’ve said numerous times, fair use is a defense to copyright infringement. It will be raised in court after you’ve been sued, and the court will decide whether your work is a fair use. If someone thinks you’ve ripped off their work, claiming your work is a fair use probably won’t stop them from suing you. I’ve talked about fair use more in-depth here.

Bonus Questions:

6) Do I need to register a copyright?

    

Technically, a work is protected by copyright as soon as it is created. However, you must register your copyrighted work in order to enforce your rights, and if you register it before an infringement occurs, you can be eligible for statutory damages.

7) How much does it cost to register a copyright?

The copyright office charges different fees depending on what is being registered. The current fee for most works created by more than one individual is $65.

8) Can I copyright my title?

No, you cannot copyright a title to a single creative work. You may be able to obtain a trademark, but only if the creative work is part of a series or a meets other certain requirements. Comic book series are typically entitled to trademark protection.

For a bit more-detailed explanation of copyright law, check out my post here.

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[1] More information on fair use, Copyright.gov, https://www.copyright.gov/fair-use/more-info.html (last visisted August 30, 2021).

Conventions and Contributory Liability

 

I’ve been thinking about the return of comic book conventions. More specifically, I’ve been thinking about contributory infringement. Recently, the second circuit decided a case involving contributory infringement of a trademark at a retail property in New York. Contributory trademark infringement allows a trademark owner to pursue liability against a third party who did not directly infringe the trademark but somehow benefited from the infringement or encouraged it. As most convention attendees know, there is a good amount of unlicensed merchandise being produced and sold at conventions. Whether or not this case could have implications for operators of comic book conventions is a fascinating question. In particular, it is an interesting question to determine whether or not a vendor’s sale of goods or art could lead to contributory infringement on the part of the convention operator.

In the case Omega SA v. 375 Canal LLC[1], the Second Circuit Court of Appeals upheld a jury verdict awarding the manufacturer of Omega watches $1.1 million in damages. The decision focused on a building owner’s willful blindness of the infringing activities taking place at their building, namely repeated sales of counterfeit high-end watches and luxury handbags, and the owner’s failure to reasonably act to stop the infringing activity upon learning of it.

Whenever people talk with me about the legal issues surrounding fan art and publisher enforcement, one of the issues I bring up is how difficult it would be for publishers to monitor for infringing activities at the numerous conventions held across the country. I know of instances where a publisher’s employees have complained about infringing goods being sold at a convention. Typically, when a publisher’s employee complains the vendor is removed or the infringing item is removed. Obviously, the burden on publishers’ employees to enforce their intellectual property could be substantive. However, this decision in 375 Canal, and other similar cases, does present an opportunity for publishers to exert more pressure on convention owners to take steps to monitor and mitigate infringing activity.

In my experience, the typical convention operator handles claims of infringement in two ways. First, they will have exhibitors sign a contract stating the goods they sell do not infringe any 3^rd party’s rights, and the exhibitor will cover the convention operator’s costs if the operator suffers harm due to the vendor’s sales of infringing goods. Second, if someone complains about a particular item or vendor, the operator may remove the vendor from the convention.

The contractual part is a good first step, and recommended, but still leaves the operator exposed because most vendors would not be able to reimburse the operator in the event of a lawsuit. However, the contract is necessary to establish that the operator is taking infringement seriously. As for asking a vendor to leave due to infringement, this policy is a must. If the operator knows the vendor is selling unlicensed or counterfeit goods and does nothing, then they could be liable for contributory trademark infringement.  

As mentioned above, protecting and enforcing trademark rights at conventions around the country (and world) can be difficult for publishers. I’m certain trademark owners would love to force operators to take a harder stance on preventing infringement, and this case opens a slight door to do so. If a convention operator has a history of allowing infringing goods to be sold at their conventions and a history of turning a blind eye to such infringement, then the operator could be found guilty of contributory trademark infringement.

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[1] 984 F.3d 244 (2021).

Trademark FAQs

A while back I did a FAQ on many of the copyright questions I receive. It’s about time to do one on trademarks as well.

Note: This is not a complete list of everything you need to know about trademarks, but a few commonly asked questions I receive. (Updated June 2021)

1) Do I need to register a trademark?

If you think the trademark is vital to your brand or organization, then registering it with the U.S. Patent and Trademark Office (USPTO) makes sense—this is known as a federal trademark. But, only do so if you are using it in interstate commerce and plan on continuously using it. Sales of product in interstate commerce and continued use are requirements to maintaining federal trademark protection. If you are using a trademark without registering it, you have what are known as common law rights, but it can be difficult to establish and protect those rights. Registration with the USPTO is the best way to prove and enforce your rights.

    1) a. Can I register a trademark if I am not yet using it?

Yes, you can file an intent-to-use application. This will preserve your right to use the trademark in connection with your goods. However, there is an additional cost to do so. When you begin using your trademark, you will have to submit a statement of use and additional fee ($100) to convert it to a registration. If you have not begun using your trademark in commerce within 6 months of it being allowed, then you will have to file a extension of time request and pay an additional fee ($125).

2) Can I register a comic book title as a trademark?

Yes, so long as you continue publishing the comic book as an ongoing series under the same title. Again, continued use is key to maintaining a trademark. Because of this requirement, titles of books or one-shots are not eligible for trademark protection.

3) How much does it cost to register a trademark?

It costs between $250-$350 per class of goods/services to file a trademark registration. Depending on how it’s filed, the number of classes of goods/services selected, and if it encounters any issues during the registration process, the costs of registration could increase. If you’re using an attorney or a service to assist you in registering the trademark, those fees will be separate. Once registered, there are additional fees to maintain your trademark registration.

4) Are there other trademark registration options?

You can try and register your trademark in the state in which you reside. It will be cheaper, but only grants you trademark rights in that state.

5) Can’t I just put a ® next to my title?

No, the ® designation is reserved only for trademarks registered with the U.S. Patent and Trademark Office. Unregistered trademarks may be designated with a “TM,” but it does not grant you any special rights.

If you’d like to read more about trademarks, check out my previous post in my Comics Startup 101 series.

Copyright, Trademark, and Comic Book Character Names

 

            Copyright law and trademark law are both very important to comic book creators. As an intellectual property lawyer, these are the two areas of law I deal with the most. They are also areas of law that can be easily confused, but they protect very different things.

            Copyright law at its most basic level protects a creative work. It protects the way a work is written or drawn. It gives the creator of the work the right to recreate it, publish it, and create derivate works based upon it. It also prevents unauthorized uses of the work that infringe on the creator’s rights.

            Trademark law serves a different purpose. A trademark is “[a] word, phrase, or logo, or other graphic symbol used by a manufacturer or seller to distinguish its product or products from those of others.”[1] The purpose of a trademark is to identify a seller’s legitimate goods in the marketplace and to prevent consumer confusion. A trademark does not protect the title of a single creative work. However, it can protect the title of periodical publications, such as comic books. It does not protect the name of a character unless that character’s name also serves as a trademark.

            A comic book series can be protected by both copyright and trademark law. The art and story in a comic book are protected by copyright law. The depictions of the characters, such as their design and character attributes, are also be protected by copyright. The title of the work is protected by trademark law.

            The most prominent example of how these differing laws interact in comic book publishing is Captain Marvel. As I’ve discussed before, Fawcett introduced the character Captain Marvel in the late 1930s. After DC Comics brought a copyright infringement lawsuit against Fawcett by DC Comics, Fawcett stopped publishing the character because the court found that the character infringed on DC’s copyrights to Superman. Had Fawcett continued publishing the character, Fawcett would have been found to have committed additional copyright infringement. (Note: I still believe the decision to be incorrect, but that was what the court decided.)

Subsequently, Marvel Comics obtained a trademark registration to publish a comic book using the title Captain Marvel. Marvel Comics introduced a new character using the same name, and continued to publish comic books titled Captain Marvel. When DC Comics obtained the rights to use Fawcett’s Captain Marvel, they were prohibited from calling the book Captain Marvel due to Marvel’s ownership of the Captain Marvel trademark registration covering comic books. Hence, DC published the stories of Fawcett’s Captain Marvel character under the title Shazam!

Two characters with the same name can coexist simultaneously. If they are not copies of each other, or close imitations, then they do not violate copyright law. If the works in which they are published do not include their name, then trademark law is not a concern. However, if one character is published in a work that includes their name, such as Captain Marvel, then another publisher with a character using the same name would be prohibited from using that character’s name in their title.

Generally speaking, it is advisable to avoid using the name of a character that already exists. Even if copyright law isn’t a concern, the elements of trademark law could trip up the unwary.You might find yourself in an undesirable situation, such as a threat of a lawsuit or the inability to use your character’s name as the title of your book. As I mentioned in my Comics Startup 101 post, a clearance search is the best way to protect yourself from unwittingly running afoul of trademark law. 

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[1] Black’s Law Dictionary, 2^nd Pocket Ed.

Copyright Termination Basics

 

        The news recently broke that the original screenwriters of the Predator movie are seeking to reclaim ownership of their screenplay from Disney, who acquired the franchise when they bought 20^th Century Fox. Since the concept of copyright terminations will continue to be an issue for years to come, I am going to do a quick summary.[1]

 

What is a copyright termination?

 The 1976 Copyright Act included provisions that allowed authors of works to terminate a previous transfer of the work. For transfers executed by the author after January 1, 1978, Section 203* of the Act states that authors can terminate the grant during a 5-year window 35 years after the original grant.

*There are two other provisions addressing terminations for works that are specific to works created or assigned before 1978. I will not be addressing those provisions here.

 

Why were authors granted the right to terminate copyright transfers?

 The termination provision was added as a replacement for the renewal term under the previous copyright law.[2] The provision was included as a safeguard for authors to protect against being exploited with unfavorable deals. Congress noted that the full value of a work can’t be known until it has been exploited.[3] By giving authors the ability to terminate the transfer, they have the ability to participate in the value of the work.

 

How can an author terminate a transfer?

The author, or his heirs or estate, may terminate a transfer by sending a written notice of the termination. It must be signed by the author, it must state the date of the termination (which must fall in the 5 year window mentioned above), and it must be served between two and ten years before the termination date. A copy of the notice must also be filed with the Copyright Office.

 

Can the termination provision be waived via contract?

No, the termination provision cannot be contracted around. The author cannot give up or waive the termination right before it vests.

 

Are there restrictions on what types of work can be terminated?

Yes, the termination provision does not apply to works-made-for-hire.

 

What happens after termination?

The author reclaims all rights that were transferred and can exploit the work in the future. Derivative works prepared during the term of the grant may continue to be exploited by the grantee pursuant to the original terms, but no new works may be produced.

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[1] All provisions discussed can be found in 17 U.S.C. §203

[2] H.Rep. Report No. 94-1476, 124.

[3] Id.

Book Review: Poisoned Chalice: The Extremely Long and Incredibly Complex Story of Marvelman (and Miracleman)

 

I’ve always found the history behind Marvelman fascinating, but I never got around to doing a deep-dive into it. Fortunately, Pádraig Ó Méalóid’s book Poisoned Chalice: The Extremely Long and Incredibly Complex Story of Marvelman (and Miracleman) exists to fill in this history. As the title suggests, the history of the character Marvelman (also known as Miracleman) is both long and complex. Poisoned Chalice provides a detailed chronicle of the character.

The book starts before the creation of Marvelman. It provides details and context for the rise of superhero comics, and the lawsuit that led to the creation of Marvelman. It goes on to discuss the character’s resurrection in the early 1980s, its name change to Miracleman later in the decade, and the legal wrangling that has sidelined the character for the last few decades.

Marvelman was created in the ’50s. The character exists because of DC Comic’s lawsuit against Fawcett’s Captain Marvel, in which Captain Marvel was found to infringe upon DC’s Superman character.[1] After the lawsuit, the publisher of Captain Marvel comics in Britain decided to continue the series by changing the name of the comic and character, redesigning the costume, and making some other changes to the story. Hence was born Marvelman, a character that enjoyed some success in Britain until publication stopped in the early ’60s.  

A new publisher relaunched the character in the ’80s in Warrior magazine. The new  stories were written by Alan Moore. Moore’s run on the character, and later Neil Gaiman’s, are what elevated the character in the eyes of many fans. However, complex legal issues involving the character have stagnated new stories for decades.

Ó Méalóid does his best to untangle the complex ownership issues that surround the character. It is a daunting task, and he relies mostly on previously given interviews and those that he has conducted himself. Without being able to directly review the contracts of those involved with the character, it is nearly impossible to completely answer the question of ownership at most points in time. However, as the book notes, Marvel seemingly owns the character now.

Of particular interest to me are the copyright and trademark issues that surround the character. Marvelman’s creation sprang directly from a copyright lawsuit. Additionally, the question of who owns the copyright in the character has played an important role in the character’s publication history in the past.

While not as well handled in the book, trademark law has also played an important role in the character’s history. In the late 1980s, U.S.-based Eclipse Comics chose to reprint the Marvelman stories that ran in Warrior and to continue the stories that Moore started. Trademark law is the explanation for the character’s name change from Marvelman to Miracleman so as not to run afoul of any trademarks owned by Marvel Comics. Additionally, the question of who owned the trademark for Miracleman in the United States likely delayed Neil Gaiman’s and Marvel’s attempts to republish and continue Gaiman’s stories with the character.  

Poisoned Chalice is a self-published book that collects and expands on a series of posts Ó Méalóid did for Comics Beat. The book could have benefited from better chapter formatting and some additional editing to tighten up some sections. Additionally, as I alluded to above, at times the book did not always clearly reflect or describe some of the nuances of copyright and trademark law and its impact on the character. However, Ó Méalóid’s attempts to rely on legitimate sources instead of merely industry heresay is commendable, and it makes the book a treasure trove of information for anyone interested in researching the history of the character.

Overall, Poisoned Chalice is a fascinating and detailed look into one of the more intriguing characters of the comic book industry.  (Affiliate link below)

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[1] Click the link for my brief description of the Captain Marvel lawsuit.

Co-creator Compensation

            A question I often get from someone thinking about making a comic is how should they pay their co-creator. In most cases, it’s the writer asking this question in regards to paying the potential artist on their book. There is no one right answer. Each person’s situation and needs will vary. Unless there is a definite reason for choosing a specific form of compensation, I recommend being flexible. Below, I’m going to discuss the three most common types of payment arrangements that I see.

 1. Work-Made-For-Hire

 If a creator wants to own and control the rights to their book outright, then they will need to have everyone who works on it sign a work-made-for-hire agreement. In these cases, the only compensation being paid is the page rate or page rate equivalent.
            For example, if Writer wants to hire Artist to draw their book, then Writer will pay Artist a set fee and have Artist sign a contract giving up all rights to their work.
            It’s a straightforward arrangement, but it’s not ideal for everyone. Also, if you want to go this route, be prepared to pay more for it. Most artists have different, higher rates for work-made-for-hire projects. (And if you’re an artist and you don’t, then you should.)
 

2. The Percentage Split

Another common arrangement is the percentage split. Each creator receives a set percentage of any profits from the book. Often, this is split 50/50, but I’ve seen different percentages. If the parties are receiving a different percentage, then it’s usually the artist receiving the higher percentage.
Sometimes, the artist will receive a higher percentage until a certain amount is reached, and then the profits will revert to a 50/50 split again. For example, Artist might receive 80% percent of the profits until Artist has received $3,000. After Artist has received $3,000, then Writer and Artist would each receive 50% of the profits going forward.
            There are a lot of different ways to structure this type of deal, but it is still relatively straightforward. For a lot of co-creators, this is the type of deal structure they will consider.
 

3. The Co-Creator Advance
            

The co-creator advance is similar to the percentage split, but with a little twist. In this scenario, one of the creators is paying a fee to the other. However, the deal is structured so that the creator making the payments (often the writer) recoups his money before the co-creators start splitting profits by percentage. 
            For example, Writer agrees to pay Artist $3,000. All profits from the book will be paid to Writer until they have received $3,000. Once Writer has earned back the money paid to Artist from the profits, then Writer and Artist will split all profits going forward 50/50.
            If a writer can afford to do it, this is a nice option that recognizes and respects the effort put into the project by your artist co-creator.
            

There are many different ways a creative team can decide to divvy up compensation. Some of it will be dictated by each party’s personal circumstances. Some of it will be determined by where the money for the project is coming from, e.g., if the publisher is issuing an advance.
The three payment arrangements discussed above are common, and they can be adjusted and modified to fit your specific needs. Consider them as helpful starting points when choosing a compensation structure for your project.    

The Power of No

 

            My comic book lawyer colleague Gamal Hennessy has been writing about leverage on his blog recently. He is using Dave Chappelle’s recent pressuring of Netflix to remove old Chappelle’s Show episodes from its service as an example of how to acquire and exert leverage. His series of posts are worthwhile reading. Leverage is an important concept, and I’d like to expand on Gamal’s thoughts a bit.

            When writing my Comics Startup 101book and blog posts, I briefly discussed leverage. In short, leverage is who holds the most power in a negotiation. If one party has more leverage in a negotiation, then they are more likely to obtain the contractual and financial terms they desire.

            Who holds the most leverage in comic book publishing? Most people will default to saying the publisher holds the most leverage. To some extent, they are correct. A publisher decides what books they will publish, and most comic book creators aspire to have their books printed and distributed by a publisher. Comic book publishing contracts heavily favor the publisher and not the creator. Even so, a creator, even an inexperienced creator, does have one piece of leverage they can always exercise—saying no.

            Creators need to carefully evaluate any deal a publisher offers. By doing so, you might find the publisher’s leverage to be flimsy. Is the publisher paying you an advance? If they are, then that works to the publisher’s advantage. If they are not, then you need to analyze how the deal benefits you. Most comic book publishing deals, particularly from smaller publishers, require the creator to front the costs of creating the book by paying for the art, lettering, coloring, etc. The publisher pays to print and distribute the book, recoups those costs, and then splits the remaining profits with the creators (often 50/50). Other questions to consider: How big is the publisher? Do they have the ability to promote and distribute your book in relevant quantities? Does working with them further your agenda or career? What other rights are you giving up? Creators should evaluate all of these points and decide if the deal makes sense for them.

            In most cases, when presented with a publishing contract, or contract of any kind, the comic book creator’s only leverage is to say no. Most creators are afraid to do so. There is always the fear that another deal might not come along or that this is your only shot. Saying no and losing a deal might seem like a bad idea, but protecting yourself from bad deals or exploitative contracts is important as well. It is challenging to balance these conflicting scenarios.

It’s scary to say no, but it can also be empowering. By saying no to a bad deal, you are valuing yourself and your work. Instead of giving up profits and control over your work, you are keeping it for yourself. More creators should be willing to do so.

Why is saying no important? Publishers need your works. They need new content to stay relevant. If publishers do not continue to print new, interesting works, then it is hard to remain profitable and grow. It is not a secret that far too many publishers offer poor contract terms. Some will negotiate. Some won’t. Most rely on a creator’s fear of not being published to get leverage and tilt the balance of negotiating power to their side. But, if their deal terms are bad, and you and others are willing to reject them, then it is a small step toward obtaining better deals for everyone.

In today’s age of self-publishing and Kickstarter, creators should seriously consider whether agreeing to a contract with a publisher is in their best financial interest. In addition to the above, when you factor in that most publishers want 50% of any media deals you might receive, and will not pay you any additional compensation for these rights, then the deal is even less favorable to you. Saying no is powerful.