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September 13, 2019

Authors' Concern Grows Over Late Royalty Payments at Dreamspinner Press

Posted by Victoria Strauss for Writer Beware®

On Wednesday, Publishers Lunch published an article by Erin Somers about payment issues at Dreamspinner Press, which I'm reprinting here with permission.
Dreamspinner Keeps Promising Authors to "Catch Up What Everyone Is Due" In Payments

Romance publisher Dreamspinner Press has not been paying royalties in timely fashion, authors have been reporting online, at least partially confirmed by emailed updates from the company that have been shared. Earlier this summer, authors posted on Twitter that the publisher had been inconsistent with payments for over a year, including delays in issuing both first quarter and second quarter 2019 royalties. In June, author TJ Klune posted, "Out of the last 8 quarters, this is the fourth time payments have been late, and the second in which I am owed penalties for said lateness." (Klune had said in March he would part ways with Dreamspinner after delivering three more books.) Author Suki Fleet posted, "I'm not waiting on a lot--but what I am waiting on is from foreign royalties paid to Dreamspinner this time *last* year, that I had to specifically ask for."

That month authors began announcing requests to revert their rights, a trend that continued over the course of the summer. There was some controversy within the romance community over whether authors withdrawing their work could cause the publisher to fail (or fail faster), in which case no one would get paid. Criticism extended to authors who supported the publisher as well, even though they were owed money.

Multiple agents PL spoke to said they were no longer doing business with Dreamspinner, except to negotiate their clients' rights back. They told us that acquisitions at the publisher had dwindled over the past year, confirmed by the sharp drop in PM deal reports, with Dreamspinner acquiring mostly from their existing authors, many of whom are unrepresented.

Dreamspinner provided authors a number of explanations in weekly emails, including writing that they had "not received payments from Amazon for UK or EU currencies," that they were awaiting deposits from "vendors," and that the late payments had been caused by a software glitch. In their latest update on September 4, the publisher said that they are anticipating a small business loan that will enable them to issue payments, and that they "can't offer a firm payment date to catch up what everyone is due." The email goes on, "With every set of deposits we receive, we've been sending payments, and we are continuing to respond as best we can to author requests." They added that they can't provide proof of the impending loan that authors have asked for because, "legal and banking documents are confidential and can't be posted online."

Meanwhile, authors including Indra Vaughn, Avon Gale, Jeff Adams, Will Knauss, CJane Elliott, Meredith Shayne, Tia Fielding, and many more have requested rights back. Fielding wrote on Facebook, "In the last year or so, they've repeatedly been more or less late in royalty payments." TJ Klune wrote in an email to the company that he posted on Twitter, that he is owed $27,448 in royalties and plans to involve a lawyer. A Facebook group of 75 former DSP authors has formed for people who have pulled their books or are considering it.

RWA has offered support for authors who have experienced trouble with Dreamspinner. They said in an August 21 statement: "We're aware of the situation, and members who need professional relations assistance, should contact to reach our staff professional relations manager." Dreamspinner did not respond to PL's request for comment.
Writer Beware has been receiving similar complaints about late royalty and advance payments and confusing/conflicting explanations for the delays, with some authors saying they are owed four- and even five-figure amounts. According to a number of authors who contacted me, these problems have become more acute in the past few months, but they aren't new: periodic payment delays, with attendant excuses, began as much as two years ago.

Although Dreamspinner regularly sends out update emails (you can see an archive of these here), several authors told me they were having trouble getting responses from Dreamspinner CEO Elizabeth North.

Also of concern: in the midst of repeated payment delays, and despite its admissions of financial distress, Dreamspinner appears to be proceeding with sweeping expansion plans, including a shift to mass market paperback format, increasing the number of translations for the foreign market, and rolling out a new accounting and payment system (which several of the authors who contacted me told me they'd had trouble with). Multiple authors told me that they fear that author royalties, which Dreamspinner says go into an escrow account, are instead being used to finance company operations.

Authors' anger at the situation is growing. Meanwhile, Dreamspinner is still open for submissions. Writers who are considering approaching this publisher might want to hold off for the moment.

More information:

Tweets from authors Avon GaleTJ Klune, Roan Parrish, KJ Charles (search "Dreamspinner" on Twitter to see many more).

Blog posts by authors Mary Winter, RJ Scott, Rhys Ford, TJ Klune.

Non-Dreamspinner author X. Marduk is compiling a Dreamspinner timeline, with lots of links to tweets and blog posts.


Allen F said...

"There was some controversy within the romance community over whether authors withdrawing their work could cause the publisher to fail (or fail faster)"

This is usually from the publishers themselves to try to keep the writers locked in just a little bit longer - and to make still more money off them.

And forgive me if I think the 'late payments from Amazon' is pure BS. As a self-pub selling on Amazon I've never had a problem with late payments for foreign currency (and if it was true then I'd be expecting it to be hitting other publishers - some who would bellow at the top of their lungs if Amazon was 'late on a payment'.)

As for misusing royalties, the question doesn't seem to be 'if', but for 'how long' they've been robbing Peter to pay Paul (and then robbing Paul to pay Peter the next quarter.)

Thanks for the warning, I'm just glad I'm not invested in them ...

Anonymous said...

Just in response to Allen F's statement above about Amazon and late payments: There was in fact a widespread issue with Amazon making late payments for the EU countries and UK earlier this year. It was for one month and it was cleared up within about three weeks. You can find discussion of that issue from that time on both Kboards and Writers Sanctum.

Lori W. said...

Re: Late payments from Amazon

Even if Amazon HAD been seriously late, it wouldn't explain why ALL royalties were delayed. Kobo, Apple, DSP's own website -- there's no reason we wouldn't have been paid for those sales because Amazon was hung up. We wouldn't have even seen those Amazon royalties on our statements until the money actually came in.

So the "late vendor payment" nonsense doesn't hold water. Unless every single vendor -- including Dreamspinner itself -- paid late, there's no reason for ALL royalties to be delayed. It also doesn't explain the systemically late payments reported by some authors (i.e., those who've said they haven't been paid on time in 2 years).

Allen F said...

I will admit that my stuff doesn't sell well enough for me to see EU payments 'every' month, but those I've had I've had no problems with. (and 'one' month doesn't explain all those ongoing late/missing payments. ;-) )

Lori W. said...

The EU payment delay was painful for me as I have a lot of self-published German and French translations. But we got paid on time for, etc., so it still wouldn't have had such a catastrophic effect on DSP's ability to pay royalties.

Also, the EU delay happened in June, I believe, and the DSP royalty snafu had been going on since well before that.

M Barnette said...

It's me again Victoria. I blew the whistle on Silver Publishing a few years ago, and here I am back again with more publisher issues. I had two titles with Dreamspinner and have requested rights back. One contract expired over a year ago, the other is still at the edge of being under contract, but I don't want to keep my books with them for many reasons of my own. I'm owed some royalties, not a lot--which in and of itself is a hair odd, my books always sell residual copies--but still enough for me to pay a small bill. What bothers me the most is we went from very detailed statements to extremely simplistic ones. And that's never a good sign--Silver and some others I used to be with did the same thing to obfuscate actual sales venues and numbers. The group mentioned for former authors is now hovering around 90 so the authors departing DSP continues to grow.

I hope DSP does pull out, but we all know the track record of publishers teetering on the brink, and it isn't a good one.

Anonymous said...

Thanks Victoria

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