agency publishing and conflicts of interest

This is a very long blog post about why I believe it is unethical for agents to publish their clients.

Before I start, I just want to encourage people who disagree with me to speak up more. Blog posts can take on a bit of an echo-chamber approach, and I know everyone who read my last post didn’t agree with it. It’s okay to disagree. And the fastest way to hash things out in a changing industry is to actually talk to each other, instead of going and sending furious e-mails to friends and creating an echo chamber of your own. You can call me whatever names you want. You can tell me why I’m wrong. I won’t mind. In fact, I approve. But since I’m also trying to finish a book, I’m turning off my internet for the vast majority of the morning, and so I probably won’t even know until I hurriedly read through everything in the afternoon.

That also means I’m not going to be able to do much policing or moderation until I get home–and my apologies for that.

Also, please read my post from earlier this morning. Yesterday’s open letter to agents painted with too broad brushstrokes. I’m appalled by what some agents are doing, but I have also been so heartened by the way that other agents have reacted. Many agents have deep integrity and respect for their clients, and are doing their best to become experts over a field that is changing so fast that even the main players scarcely understand what’s happening. They’re doing their best to guide their clients through these changing times. I shouldn’t have implied that all agents were at fault.

Where I’m coming from.

It’s not a surprise to long-time readers of this blog that my background is as a lawyer. That means that when I talk about professional conduct, I’m talking about it from the point of view of someone who’s in a profession which is often maligned for its lack of ethics–and that means that those of us who care deeply are taught, and required to remind ourselves on a regular basis what ethics mean.

But we’re not just aware of ethical behavior for lawyers. Lawyers are often required to counsel other clients about the appropriate standard for behavior. Lawyers counsel corporation board members, doctors, and so forth on the appropriate standards for ethical behavior. We have to think about what professional occupations are, what they do, and what purpose they serve.

If you haven’t already been able to tell, I try to walk as upright a road as I can in everything that I do. That means that I take the concept of professional ethics very, very seriously–in all my professions–and it bothers me when others pay short shrift to the notion. It especially bothers me when they pay short shrift but obviously don’t understand, and haven’t considered, the ethical considerations.

That being said, my expertise in law is not focused on either the fields of professional responsibility or agency law (which are the areas that this touches on). Not that you should be taking legal advice from random strangers on the internet anyway, and not that this is legal advice. There are some areas of law I know huge amounts about, but let’s just say that my class on business entities was the one where I spent the most time checking election results, and that my understanding of fields that are predominantly state law in the US (family law, agency law, most corporate law, among others) is probably the worst out of all legal fields.

So I’m coming from the standpoint of someone who cares about ethics, is informed of the general principles, has seen enough train wrecks to cringe, but is not an expert at particulars.

Also: if you haven’t noticed by now, I can be pedantic, and I state everything in firm terms. The last is a function of being a lawyer, the former a function of being a teacher. I know it gets on some people’s nerves. But I’d rather be corrected if you think I’m wrong. I do try to listen. And this would be a lot more useful as a conversation if people who see things differently than I do actually engaged and tried to make me see your point of view.

I’m not trying to preach to the choir. I would love it if people who are on a different wavelength actually tried to explain where they are coming from. I don’t promise to agree with you, or not to argue with you, but I’ll listen and try to see where you’re coming from, and if you convince me, I’ll admit it, and if you don’t, I’ll explain why.

So, on to Courtney being pedantic.

A basic explanation about what I mean by “unethical” behavior.

I realize that when I say that behavior is unethical, many people immediately assume that I’m saying that it is immoral–on the level of lying, cheating, or fraud or the like. That isn’t always the case. Professional ethics are standards of professional accountability. Sometimes–often–they will bar immoral behavior. But quite often, what professional ethics determine are not what is immoral, but what is merely irresponsible. (This is why, for instance, the ABA’s code on legal ethics is officially called the Model Rules of Professional Responsibility.)

So when I say that something is “unethical,” I am not saying that the person is a sinner who will burn in agency hell. I am saying that the person is taking a tack that I believe is professionally irresponsible, based upon common law rules of fiduciary accountability.

Technically, I think that I would use the “ethics” label to apply to codes of professional responsibility for the classes of professionals who owe fiduciary duties, duties of confidentiality, and or duties of good care, to their clients. Other people might expand the classifications.

Thus, for instance, it’s often not considered immoral for two consenting, unencumbered adults to sleep with each other. (Er, depending on your view of morality. I guess that’s a tell as to how I see the world, but try not to let my lack of morals on this point distract you.) But it would be unethical for a lawyer to sleep with a consenting client. There are a lot of reasons for this–for one, it might prejudice the lawyer’s view of the case; for another, the client might lose the ability to confide aspects of the case to the lawyer because of the emotional relationship.

It’s not immoral for you to tell a friend that your brother-in-law is starting a business and is looking for venture capital, and you think it’s a good opportunity. But if you’re a stock brocker, it is unethical–professionally irresponsible–for you to suggest to your client that your brother-in-law’s business is a good investment opportunity. You may think it’s awesome, but he’s your brother in law, and with your emotions engaged, you cannot give objective advice.

Professional responsibility means that there are plenty of things that are not immoral in the general course of things, but that one person must refrain from doing under certain circumstances, because the professional relationship they are in prevents them from doing so.

A few general notes on professional responsibility.

You can’t be someone’s lawyer and their lover. You can’t be someone’s therapist and their stock broker at the same time. If you are in a position of trust with someone, it is professionally irresponsible to put yourself in a second position which is in conflict with that position of trust. So, for instance, if you’re sleeping with the client who you’re representing in a criminal case, the client may feel that he can’t confide details in you that are necessary for prosecution of the case–for instance, that he is innocent, and his alibi is the person he was cheating on you with. If someone trusts you with the innermost secrets of their family life, they’ve reposed so much trust in you as a person, that a business relationship with them could easily take advantage of that trust.

Of course, therapists and doctors and lawyers are regulated by statute; agents are not. But that doesn’t mean that agents are not regulated at all. Agents are fiduciaries for their clients, and even though there is no regulation of agents by statute, they are regulated under the common law.

I’ll be more specific later.

Agents who provide services to their clients are fine.

Let’s be clear. I think there are a lot of services that agents can provide to their clients that do not cross the ethical line. I think agents can assist authors with self-publishing in exchange for 15%–connecting them with editors who match the author’s style (this is huge), vetting copy-editors and proof-readers (this is huge), finding good cover artists (again, important) and formatters. Agents may be able to act as mini-aggregators, getting their clients places they couldn’t get on their own as a self-publisher. I think all those things are good–it’s between you and your client.

We can argue over and over about whether the agent is providing the client with a good deal, but I think that the services listed above, and more, are services that do not conflict with the agent’s duties.

(I also think that it means that the days of the one-size-fits-all agency agreement are basically over. There’s probably going to be multiple flavors, depending on what the client needs.)

So I’m okay, for instance, with the DGLM model. I’m okay with agents who provide services. My own agency has long provided services above and beyond selling books to publishers, and so long as those services do not create a conflict of interest, I think they are part of the way that agents will work with authors to help build long and satisfying careers.

Agents who publish their clients are engaging in unethical behavior.

The only services that I think an agent must avoid are the following:

* Services that involve self-dealing. That means, the agent can’t sell the author to her own publishing house and get a higher percentage of the take. That creates incentives for the agent to not negotiate as hard with competing publishing houses, creates doubt on the part of the author as to whether the agent is really trying to exploit her material.

* Services that invert the principal-agent relationship. In the principal-agent relationship, the author’s essentially in the driver’s seat. That means, if an author says, “I can’t work with that editor; we need a new one,” the agent assisting with self-publishing needs to help her find a new one. (Of course, you can try to clean up the relationship and figure out what went wrong, too.) If the author says, “That cover is crap. We need a new one,” the agent works on finding a new one. If the agent’s vision differs too much from the author’s vision, the self-publishing relationship probably isn’t a good fit. But if the agent is actually publishing the author, what does she do if the author says, “That cover is crap. We need a new one.” What if the author does it four times in a row? Think about that. As a publisher, you are in the driver’s seat. As an agent, you are working for the author. Both those things cannot be true at the same time. I do not believe you can function as someone’s agent if you take the reins from the author’s hands, and I don’t think you can function as a publisher if you don’t take the reins from the author’s hands. These two hats do not fit on the same head.

I have not heard anyone who understands the concept conflict of interest explain to me why providing services that would touch on this are not a conflict of interest. I’ve heard agents say, “I just won’t let it be a conflict” or “our interests are never perfectly aligned, so why bother?” but sorry, those things are cop-outs.

It’s not like the body of knowledge about conflicts is non-existent and we’re working from scratch here. There are ways to deal with these kinds of conflicts to make sure that they’re not causing problems, but as far as I can tell, the people who are taking on these duties aren’t taking the conflict of interest issue seriously.

I’m willing to be corrected. If someone from an agency with a publishing arm wants to explain to me how the are staying faithful to their fiduciary duties, I would love to hear it. Really. I mean that.

But so far, all I’ve heard is “conflict, shmonflict.”

Agents who start publishing arms aren’t bad people.

This is one of the most important points. Just because I’ve called someone “unethical” doesn’t mean I think they are evil. In fact, one of the things every lawyer needs to learn early on about professional responsibility is that people who run afoul of their ethical obligations are often very smart, very intelligent, and very well-meaning. You need to learn that, because otherwise you will think, “These rules don’t apply to me. I’m not a bad person.”

In fact, lawyers are more likely to get into trouble by trying to help out a friend, or trying to go the extra mile and including someone, or trying to push the boundaries of helping a client, then they are to sit in a cold room chuckling evilly about how they’ve just managed to screw someone. Good people make mistakes all the time, and most of the mistakes are not motivated by the desire to do someone harm–quite the reverse.

I’m more disturbed by someone who says, “I will avoid a conflict of interest because if the interest conflicts, I will act as an agent instead of a publisher,” because that tells me that this person has never studied how professionally irresponsible behavior takes place. That’s where it starts–by telling yourself that you can minimize the impact by not doing anything wrong.

No. You minimize the impact of a conflict of interest by not putting yourself in a situation where conflicts of interest will occur.

The way I often hear this come up is often as follows: “But if you can’t trust your agent, why have them?” Or: “I trust my agent, and I don’t believe she would screw me.” I can’t argue with someone who trusts their agent–that’s your decision and your choice. I also think that people who claim that you should trust nobody are just as bad as the ones who say you should repose trust blindly–the complete skeptic is as good at figuring out the truth as the gullible person who believes everything. I don’t have a problem with trusting people.

But for me, personally, it’s just not that simple. Here’s the thing about trust: as a personal matter, I trust people who demonstrate that they understand the process by which good intentions get fouled up, and take steps to insulate themselves from the worst temptations. I don’t think people are “good” or “bad” and you trust the good ones and consign the bad ones to hell. I think most people are well-intentioned but prone to mistakes, and the reasons why some screw up and some don’t is (a) luck, and (b) some people recognize that they are fallible and just don’t put themselves in that position to start with. The person who says, “I’m not going to take that chance” is the person I trust, because I know they’re aware of the risks.

More than that. I believe that the person who says, “It’s not going to be a problem” is someone who is not self-aware enough to avoid problems. And even though I may trust that person’s intentions, I don’t trust their results. I’m fundamentally a process person. I think that people are more likely to save money if they transfer it into a second account, instead of telling themselves not to spend it unless they really need it; I think that the best way to avoid eating too many cookies is not to buy any; I think it’s a good idea to take away someone’s keys before they start drinking; and I think people are more likely to do good because they make themselves keep away from temptation entirely. Process leads to prophylactic rules–meaning they’re by necessity cut larger than they need to be, to avoid harm. They may seem stodgy and weird, but the rules of agency relationship have arisen out of long experience.

As far as I remember, and as far as I’ve been able to ascertain, general agency law offers the same advice: an agent in a principal-agent relationship needs to avoid even the appearance of a conflict. Keep to good process, and you’re not creating a risk. Create a risk, and you’re acting irresponsibly. Even if that risk is never actualized into actual harm, that’s irresponsible.

When someone says, “I trust my agent,” in response to a conflict of interest that arises, I feel like the person who helplessly watches her best friend get in the car with her drunk boyfriend. He might not crash. Most people who drive drunk don’t. But he also might kill her, and I want to scream, “Look, if your boyfriend was worthy of trust, he wouldn’t be behind the wheel.” And the instant someone says to me directly after consuming a six-pack, “Look, I’m good to drive, I don’t know why you don’t trust me,” is the point when I stalk away in a blind fury. If you want to make sure harm doesn’t arise, you don’t put yourself in a situation where your reflexes are slowed, your senses dimmed, and you’re directing a multi-ton vehicle at high speeds.

Agents can be good people, who want to help their clients, and can nonetheless do harm to their clients by creating conflicts. I’ve just seen too many examples in too many other fields for me to simply say it’s a matter of trust. I trust process, and I trust people who believe in good processes.

That’s the lawyer in me: I look at things and think of all the ways they can go south.

This kind of conflict of interest can destroy an agent-client relationship.

I’ve blogged before about the ways in which engaging in self-dealing can lead an agent to steer a client towards deals that aren’t the best for the client. I could spin off horror story after horror story, but I don’t think horror stories are effective, because they make an agent say, “Oh, but I would never do that” and make clients say, “Oh, but my agent would never do that.”

The real horror story of conflicts of interest is not about agents rampaging through a client’s finances and stealing things and being immoral. It’s more subtle than that.

The story can look like this: An agent sends a client out on submission, and gets an offer–a very tepid offer–from a publishing house that is not anyone’s first choice, or  second, or sixth. The client is kind of excited about the offer, because, hey, it’s an offer… but she’s not 100% on board. Maybe the agent mentions the publishing arm first. Maybe your client does. And the client decides to go with the agent over the less-than-exciting offer. Why wouldn’t she? The client trusts her agent. The client speaks about her intelligence and her integrity in glowing terms. Both the agent and the client believe that there isn’t a conflict of interest here–the agent is doing exactly what the client wants, after all!

And then. Six months down the line, sales aren’t what you had hoped. You’re nowhere near making up the tiny advance that the client would have got elsewhere.

It’s easy to trust an agent when things are going well. But we all know that when things don’t go well, people naturally tend towards blame. They want to look for reasons–and we all know that in publishing, sometimes there really is no reason, or sometimes the reason is something that’s totally out of our control. But now, the client is looking, and they start wondering: Did my agent fail me? Did my agent not put her all into negotiating a better offer from that house because she wanted to make her own house look attractive? Did she do her fail to place my manuscript before the right people at better houses, because she really wanted to publish me herself?

It doesn’t matter if there’s merit to the argument. The doubt is there. It’s insidious. It’s hard to shake loose, and that’s the kind of thing that can undermine agent-client trust. It’s not big, and it’s not flashy, but it’s real.

This scenario can play out even if the agent never self-publishes the author. If she fails to obtain an offer, is it because nobody offered? Or is it because the agent wanted the manuscript for the self-publishing arm that the agent was setting up, and so set the manuscript up for failure? I have seen this last doubt infect more than one friend who has been on submission this last year from houses where the agent is publishing the book. This is real. It can destroy the agent-client relationship.

Of course, it might not always end in mere doubts. The client, if sufficiently doubtful, may be able to file a lawsuit claiming that the agent violated one of the fiduciary duties that it owes to the principals. Depending on the circumstances, she may be able to force the agent to disgorge any profits she received on behalf of the publishing house. And that really wouldn’t be good for the agent/client relationship, either.

“But,” someone might say, “we agreed when we started that it was okay for me to do this!”

That might not be a defense. I highly doubt that some of the people who are pooh-poohing the notion of conflicts of interest in agency publishing have given their authors a full and complete disclosure of the risks involved.

And besides, there are some ethical responsibilities that simply can’t be discharged by consent and disclosure. For instance, there is no way that someone’s psychotherapist can create a consent and disclosure regime which allows them to also manage that person’s stock portfolio.

I don’t know the precise rules for consent and disclosure at issue here. It probably depends on the nature of the conflict (and there are a lot of potential conflicts), and other things like what state you’re in, and what state law applies, and so forth. All I know is that these things are not easy, and the mere fact that a client agrees to something at one point in the game should not be counted on to insulate you from further harm down stream.

“But,” someone might say, “my client has never mentioned having a problem with my conflict of interest!”

Tough beans. It’s the agent’s job to remain free of conflicts, not the author’s job to police them.

A conflict of interest is not something that is decided by the author and the agent. It’s decided by common law. There are real legal principles at issue here. You can’t just make up an answer and think that’s good enough.

If you’re an agent and you want to start a publishing arm, you need to talk to a lawyer who specializes in agency law.

Do I need to say any more? A lawyer who specializes in agency law will be a billion times better to talk to than reading this blog post, and then you can explain to everyone how you set up your in-agency publishing house with an appropriate firewall in a way that avoids conflicts. That’s fine.

But do take it seriously. I’m hearing too many people say things that are too blithely dismissive of the notion of conflict of interest for me to feel easy about this.

41 thoughts on “agency publishing and conflicts of interest

  1. Courtney, thank you for this careful analysis. Coming from an academic environment myself, conflict of interest is a biiig deal. For researchers with grant funding, any possible point of conflict has to be reported. Simply put, there needs to be no question about one’s responsible handling of money, and no possibility of dual relationships. That’s a good guideline for many fields and is certainly one that most agents also abide by (as you noted in your previous post).

    I’m wondering, what are your thoughts on authors who are NOT clients of an agency using an agency’s self-publishing arm? It seems like there would not be a dual relationship in that case, and so would be on firmer ethical ground.

  2. Hi Courtney

    I still don’t know what the big deal is. I’ve been in ‘business’ all of my life, even running a NZ listed company, and selling books is a business.

    I’ve always found all business transactions are a mixture of sound contracts and trust. Having an agent publish you would be no different. You need to check the contract and have a good relationship/trust with whoever you do business with. The publishing business is no differnet than if I were signing a contract to sell oranges. A good lawyer is always advisable. BUT I also never did business with anyone I did not trust.

    I say bring it on, agents. They will be another channel to market for new authors who struggle to get noticed. As a writer just ensure you understand the terms of your business relationship and trust that the contract is mutually beneficial.

  3. “I’m wondering, what are your thoughts on authors who are NOT clients of an agency using an agency’s self-publishing arm? It seems like there would not be a dual relationship in that case, and so would be on firmer ethical ground.”

    I want to point out that an agency that recently started a publishing arm (where they’ve published existing clients) said in their blog comments they might also “possibly” sign publishing clients to their literary agency. So, it’s going both ways.

  4. As a new author looking for an agent, your analysis of agencdy publishing conflicts was very educational. When I first heard that some of the agencies were going into the publishing business, I thought, well that sounds smart and convenient. Imagine if I could sign with an agent who also published. It seemed it would be a sort of fast track to being published.

    After reading your blog, (well written and easy to understand) I see serious concerns that would have never occured to me at this point in my writing career.

    Who knows, I may be thanking you some day for keeping me from making a a wrong decision.

  5. Courtney, you write well, on an important topic of “conflict of interests” with general examples and then about literary agents.
    About two months ago, an article in the “Wall Street Journal” against young adults fiction generated a lot of buzz. Why not submit this essay to the “Wall Street Journal” or the “New York Times” as well? … while putting references to your own novellas at the end.

    If it will created a buzz, your novellas will get extra publicity and sales will follow.

  6. Well said. At some point the agent will have to make a (or many)decision(s) to either do what is best for the client or what is best for the publishing arm. And I simply can’t see an author bringing forth complaints about the publishing arm without trepidation or worry that this will harm the agent/author relationship. That is something that should never be placed at the author’s feet. Then again, I may see it this way because no matter the subject in my paralegal studies there was a chapter on ethics.

  7. Excellent coverage of ethics. Associations like the AAR aside, I’ve never understood why there isn’t a more binding codified standard for entertainment agency rules akin to the lawyer’s MRPC.

    Perhaps the reason is, Hollywood might shut down.

  8. There’s no conflict at all…if you understand that agents have almost zero of the skills needed to succeed in modern digital publishing. Every previous job skill is based entirely on a different model. NONE of the skills align! (Unless, of course, you let your agent edit your work, but that’s an entirely different issue…)

    In short, if you choose to let a modern agent “publish” you, you almost certainly picked the wrong person to do it. Let your agent represent you if you want. But what do they know about choosing cover art, formatting a file, marketing to readers, handling distributors? You might make the case that they are “handling your money” for you, but with all modern digital markets dumping the money straight in your bank account, even that “skill” has zero value.

    I have heard the argument that agent/publishers can offer economies of scale by marketing an entire stable of authors. Maybe so. I’d have to see it to believe it, and still have to ask why one would think an agent is best suited to the task.

    Your previous post was right, Courtney. Strip away the bookstores and the closed access to traditional publishers and the shrinking shelf distribution and the average indie author is far more capable of successfully publishing and marketing your book. In the digital world, the monopoly of access achieved by agents is worthless.

    I’m curious to see where the new value will come from. But it’s not in digital publishing as it stands today, where there is virtually no negotiating for the self-publishing author–you upload the file and you earn what you earn, not what someone else thinks you are worth. The ethics of it is at a far higher level of discussion than it merits, but I understand writers may feel a loyalty to someone who helped them in a different era. But it’s not anyone’s fault that the world has changed. And I don’t see Amazon, BN, or Smashwords requiring agents anytime soon…

    Here’s a tip, agents, a truly needed and useful service if you need a new job: set up a management company to match authors with foreign translators.

  9. I feel the imbalance of power is the unethical aspect of the agent-as-publisher model. Even though a literary agent is both “employee” and business partner, the process of querying and waiting for acceptance places a bit of the power (emotionally and professionally) in the agent’s court.

    A client trusts their agent implicitly, and because the agent had the power to accept or reject their work, they can or may view their agent as the person steering their career. IMO, an agent setting up a publishing house further enforces that feeling. You’ve detailed this beautifully in your post above Courtney, but I can’t help but wonder if agents contemplating this move have thought about this.

  10. @Theresa Romain:

    I’m wondering, what are your thoughts on authors who are NOT clients of an agency using an agency’s self-publishing arm? It seems like there would not be a dual relationship in that case, and so would be on firmer ethical ground.

    Honestly, I don’t know why you would do this. If you’re going to go with an e-publishing house, go with a proven one–like Samhain. I feel like I couldn’t trust the publishing house, either. If they’re also publishing their clients, the clients might get better treatment without regard to merit of the manuscript. I’m not sure why you’d want that.

    But I don’t really know. I haven’t spent all that much time on it.

  11. @Scott Nicholson:

    I’m curious to see where the new value will come from. But it’s not in digital publishing as it stands today, where there is virtually no negotiating for the self-publishing author–you upload the file and you earn what you earn, not what someone else thinks you are worth.

    I sold 7,000 copies of my novella in one day because Amazon randomly decided to include the novella in one of its e-mail blitzes.

    Imagine what would happen if someone could, you know, talk to Amazon and negotiate for placement?

    Lauren Dane hit the USA Today list with a 4-year-old book because her publisher had a freebie going for the first in the series. Imagine what you could do if you were working with someone who could actually coordinate a freebie with your publishing schedule, instead of having to change something to free on Smashwords and hope.

    The days of negotiation are very much alive.

  12. I love your pedantic and precise way of explaining things. 🙂 That’s why your posts so often hit my “Yes, this is the final word” button.

  13. Courtney, the point you’ve just made about negotiation–the prospects for getting prime positioning at Amazon, for example–are a good example, IMO, of where agents could offer value-added service if they want to be involved in epublishing.

    It would be interesting to see some literary agents lay out business plans in which they would propose, through their actions, to improve the position, opportunities, profile, and earnings of their clients’ ebooks in exchange for a commission.

    Right now, though, all we’re so far seeing is agents proposing to do what publishers -and- writers have already learned how to do well without them. That ship has sailed. Indeed, the whoe fleet left, while agents dozed on the shore.

  14. It’s been so long since I’ve heard someone mention that even the APPEARANCE of a conflict of interest was to be avoided that I was shocked and amazed to see it brought up. It’s an important issue. Thanks for heralding it.

  15. Well said. I tried to think of ways to argue with you, but I agree across the board. 🙂 … I was pleased when my agency publicly stated that they felt agents as publishers was a conflict of interest and they would not become publishers. Assisting with whatever is needed and paying X in a mutually agreed deal is fine; acting as a publisher is not. Thanks for being both long and pedantic 🙂

  16. I agree with your analysis almost entirely, but I’m more squeamish than you about the DGLM setup, simply because I think the scenario you envision where the author gets a weak offer from a publisher and goes w/ the agency publishing arm instead is just as likely. Whenever the agent has the fallback position of becoming your publisher and earning commission that way, there is less incentive for him/her to try to sell you aggressively to another publishing house. I don’t think it matters how much that commission is; even if it’s only 15% , it’s a way for the agent to earn that 15% without doing his/her primary job, which is to act as your representative in the sale of your work to a third party. I just don’t like it and I don’t think I ever will.

    That’s not to say I don’t think there are services agents could offer to clients who want to self-publish that could truly e worth 15% or even more. I’d they can make my revenue stream larger, then that’s valuable. But even then, I’d want to see a firewall, and I think the self-publishing services need to be completely discrete from the sales and contract negotiation function. Anything else runs straight into questions I don’t want to have to deal with with my agent.

  17. @Jackie Barbosa: I don’t see that as a conflict of interest though–just a way for an agent to cop out, if the agent is lazy. That’s no different than saying, “I don’t want my agent dealing with epublishing houses because I want them to try to do their job, which is to act as my representative to print houses.” I don’t see why we have to define agency representation in so crabbed a manner.

    If your agent is lazy, you’re not going to get a good deal. That’s not about a conflict of interest, though, just a bad agent.

    I see it as a way for an aggressive agent to potentially have greater leverage in the long run–to say, “Look, I’ve self-published clients before and made $X for them; if you don’t pony up more money, we’re walking.”

    But this gets into something I pinged on briefly above–that I think we’re at the end of a one-size-fits-all agency era, and so if you’re personally not confident about something and someone else personally is, you may just need two different agency agreements to make you both happy.

    Problem thus solved.

  18. Holding out the carrot of possible representation to the participants of a literary agent owned publishing venture is the epitome of conflict of interest.
    It turns the agency into a Publishers Clearinghouse of agencies. “But a product and your chance to win increases!”
    We all know making the statement authors might gain representation from the literary agent arm of the business if they publish with the publishing end is a great tool to pull writes in. It’s also unethical.

  19. Ethics, really? It is refreshing to find out there are other people who care about them. I think you have laid it out well and I agree. Unfortunately people always think they are the magic exception to life’s pitfalls so I think the agency publisher combo will move forward – right into the pitfalls you predict.

  20. Hi Courtney,

    As an agent, I think you’ve done an incredible job of laying out the conflicts of interest inherent in agent self-publishing arms.

    I do think that agents need to adapt to changing times in publishing, yes, and certainly many of us are trying with new and interesting opportunities in e-publishing among other things for our clients. However, for me, at least, I’m doing so only and always as an agent.

    I agree wholeheartedly with everything you wrote about the ethics of the agent/author relationship and writers are lucky to have this post as a resource in these constantly changing times.

  21. Courtney and Laura, that placement negotiation would be a valuable skill. But Amazon will already sell you placement–it’s on their website. Admittedly, it’s complicated, but it’s yet another skill that anyone can master with willingness. A progressive ad agency would be a great business for former agents, but again, I see no reason they would be particularly more suited to that task than anyone else. Heck, the biggest challenge of the new era is unlearning what you thought you knew.

    Amazon is only testing data right now, and there’s a big element of luck in the books that get featured in customer emails–and what’s funny is it is literally life-changing for the authors (many who vaguely ascribe it to some marketing tactic or social-media effort they did, when it wasn’t). It has a tremendously powerful effect. And while it is lucky for the author, it’s not completely random, and I think that will become clear very soon.

    Amazon is about to become the most powerful and best publisher on Earth.

  22. I really appreciate your clarification of the difference between offering services to help a client self-publish and actually publishing clients.

    If I was ever to self-publish, I would want all the services you mention and others too, and having an agent, who knows so many people in publishing would be a great place to do one-stop shopping for that. 15% is perfectly fair, as those services are worth a lot.

    One thing that really worries me about agents becoming actual publishers is that no one knows, like an agent, just how desperate novice writers are to publish their books–nor just how many mediocre (and worse) writers there are in the world who are self-delusionally convinced they’re the next [insert gazillionaire best-selling writer here].

    In my imagination, an agent-turned publisher is looking at all those rejected queries in their email trash and thinking about the money–even small amounts of money from each of those thousands of rejections–that could made selling those writers a booby prize.

    I understand that publishing is always an industry where the money is tight and profits are small. I don’t begrudge professionals who are looking for innovative ways to keep themselves in business and keep providing high quality services to their clients and to the reading public. But actual, full-on publishing seems really, really shady to me.

    In the end, all you can really say is Writer Beware. But so many aren’t and won’t be. There will always be plenty of writers who are essentially fish in a barrel for unscrupulous “professionals” in whatever role.

    And as things change so rapidly, it will be hard to sort through the complexities of what is or isn’t actually unscrupulous. So again, thanks for this very clear and compelling explanation of how you see it.

    Sorry if I’m contributing to your echo-chamber, but I just happen to agree with you 100%.

  23. One of the tricks I’ve always found for avoiding similar conflicts (granted, this isn’t in professional endeavors) is to stop asking myself “am I being fair here?” and start asking “does it APPEAR to be fair from the outside?”

    Quite often the appearance of fairness is just as, if not more, important than the fairness itself. The same with objectivity and conflict of interest. If there appears to be a conflict of interest, someone will think there is, and that causes problems.

    So, even if an Agent somehow does magically walk the tight rope of having a publishing arm and not having a conflict of interest with their clients, it can still appear to be the case, and thus cause problems.

    You don’t want your client thinking “my agent’s publishing house didn’t sell my book as hard as it could”, but you also don’t want them thinking “my agent didn’t fight as hard for the best deal because he/she was mad I didn’t want to go with their publishing arm.” The only way I can think of to avoid both? Don’t have a publishing arm.

  24. So glad you wrote this post, Courtney! Thank you. Not only as a professional resource, but as personal a gut-check. Ethics are a HUGE issue that not enough people pay attention to, imho. This hits home on several levels and just reinforces that there is someone else out there on the same wavelength as me. Again, thank you.

  25. I’ve been practicing writing novels since 2009, when it comes time to submit my work to literary agents, I don’t think I will. Epublishing of my books seems like the best option. Agents and publishers just seem greedy these days. I’m glad to see eBooks bringing the power back to the writer/author these days.

  26. Courtney, first off, you are my new FAVORITE historical author. I just loved Unveiled and Unlocked is next in my TBR pile.

    Next, I couldn’t agree with you more. Recently, one agency in particular has blurred the line between author advocate and publisher. I would never sign with one of these agencies.

    However, during these changing times, where it has become much more easy and profitable for authors to self-publish with Kindle, I think agents are forced to reinvent themselves in order to stay in business. Unless authors need agents for managing movie and international rights, I think many agents will find themselves out of work in this new era.

  27. @Scott Nicholson

    As a reader, the service I see traditional publishers/agents still being able to offer in the is that of a crap filter. The people who’re responsible for writing slush pile horrors are as capable of uploading something to Amazon as the next J K Rowling. Even if you count people who’re good enough to be successful on the midlist people who should have their fingers broken are a far larger group.

    If something has gone through a publisher I know that it’s met a minimal level of quality that puts it above 99% of manuscripts that are written. Just like with slush pile submissions, anything self published has to be treated as radioactive until proven otherwise. The power of sock puppetry, or even just well meaning friends who haven’t touched a book since completing school, means that user reviews are not trustworthy.

    Endorsements from people I know and trust work; but run the risk of becoming an echo chamber and unless some of them are willing to pay for the privilege of being slush readers in their free time it still doesn’t leave any good way for new authors to break out.

  28. Well, it’s working. I suggested to you to send this essay to major newspapers to get larger circulation and also promote your name and your novels. Now I read on Nathan Bransford’s blog about your essay, so more readers will read it. Best wishes.

  29. Maybe I’m being a bit slow here – and I have to admit, I didn’t read all the replies – but I’m still not sure what all the fuss is about. To me the debate about whether being an agent AND a publisher is unethical is a non-starter, mainly because I would always see the two as being mutually exclusive.

    I’m guessing the principle concern is an agent who then suggests that you use their publishing arm – but what kind of agent would be dumb enough to make such an offer? And what kind of writer would be dumb enough to accept it?

  30. Aonghus, the answer is…a good bit of them. At this point, I think it may be 50/50 as to how agents are splitting on this. There are examples. Just Google “agents becoming publishers.”

  31. Anyone else see The Knight Agency’s blogpost about their self-publishing “assistance” they are now offering their current clients for backlist titles:

    My first thought was, well, they do seem to be providing quite a bit of editing/marketing assistance which would be helpful…but then I started thinking, do they actually EMPLOY editors?

  32. I am the author of BLOOD AND BULLETS, a dark urban fantasy out from Kensington in February. It is part of a 3 book deal.
    I got this deal on my own.
    I am un-agented.
    I tried, none of them wanted my book. My editor however LOVED it and bought it in a 3 book deal. I handled the contract myself. I sold my first short story the same way. By myself.
    I will independently publish some stories that don’t fit traditional publishing but my fans will enjoy.
    I will do that by myself.
    It is all part of a plan. MY plan, for MY career.

    I am not saying I would never sign with an agent, but they would have to bring a lot to the table, including an ethical standpoint and a reputation of good character.

    I am not sure where I stand with agents assisting with independent publishing. I think the reward factor will play a part. If they only receive their standard commission for facilitating the process, then if they can get more money from a traditional house they should do it instead of taking the risk on independent publication.
    If their percentage is fluid, or they sign clients specifically to independently publish, then run writer run!

    Thank you for your information, I truly appreciate it.

  33. I’m not sure I fully grasp the difference you’re trying to draw between “Agents who set up publishing arms” and “Agents who will ‘fascilitate’ self-publishing” – which here is being called the “DGLM model”.

    I don’t discount that some authors will find a lot of value added in “fascilitation” – finding good, high-quality editors and cover artists, adn so-on and so-forth. And they can charge what they want to charge for the service – the “market”, I’m sure, will eventually decide whether that’s a fair rate.

    The first question I have, specifically, regards something that I saw pointed out on another blog in which a model like this was discussed (and which I also saw mentioned specifically in DGLM’s announcement of their new service) and that concerns the collection of monies. Apparently agents offering these services intend to collect the proceeds from sales, take their cut, and pass the remainder on to writers just as they’ve always done with traditional publishers. Now, I’ve never self-epublished before, but my understanding is that when a document is uploaded to one of the various etailers like Amazon, the forms require you to indicate the payment address of the publisher to which payments should be sent. If you’re self-pubbing, that address would be your own. If, however, your agent’s address is here, and your agent is collecting these monies, isn’t that a tacit admission on the agent’s part that they are, in fact, the “publisher”.

    I know in the traditional model agents collect monies from publishers and take their commission/cut before sending the rest to authors. But in a typical self-epubbing situation, the author collects proceeds directly from the etailers. The re-intermediation of agents into this payment stream process makes me concerned about the potential Conflict of Interests. As you say in your post, even the appearance of a conflict is dangerous. And if an agent is saying “I’m not a publisher” but is still collecting money before an author sees it, even though the new self-epubbing model is that authors collect money directly, that points back toward being a Conflict. At the very least, it has the appearance of being one, even if it can be rationalized away.

    My second question your response to one commenter’s concerns noted above. @Jackie Barbosa indicated that she thought there was still an appearance of a conflict with the DGLM model. You rationalized it away in the same way that you said in your post that a conflict can’t so easily be rationalized (vis-a-vis “Oh, I just won’t let it be a conflict”). Even if an agent isn’t a Publisher… if they are “fascilitating” self-publishing, this appearance of a conflict still exists because it still creates in an author’s mind the nagging doubt that an agent didn’t fulfill their fiduciary responsibility because they thought “Well, if I can’t sell this to a traditional publisher, I can just ‘fascilitate’ their self-pubbing.” And the rejoinder that they can use this as a hard-bargaining tactic would be equally applicable if the agent wasn’t merely fascilitating, but actively publishing, i.e. “Look, I’ve published clients before and made $X for them; if you don’t pony up more money, we’re walking.” That’s not a very convincing argument, then, that this so-called DGLM model is somehow free of conflict when a full-on Agent-with-publishing-arm is not. Functionally, they look the same. Further, your response actually makes a decent case for why this “fascilitation” model is, in fact, a conflict: insofar as the option of “fasciliating the author later” gives an agent a “cop-out” for being “lazy”. Being a “lazy” agent is another way of saying the agent has breached his/her fiduciary responsibility. And yes, of course you fire an agent that is breaching their fiduciary responsibility. In sum: I’m not sure that I understand how one breach of fiduciary responsibility is inherently different from the other.

    I’m amenable to a better explanation of how the two are genuinely different – but so far I’ve not seen it. And I’m interested in your understanding of the money-collection-and-disbursement issue, given how clearly you’ve laid out the rest of this conflict of interest argument. I’m also amenable to being corrected where I may have gotten my facts wrong.

    I’m trying to reserve judgment on all of the changes happening in the industry. As an as-yet unpublished author, my primary concern is for how these changes affect those who are like me – writing furiously now, but looking forward to the day when they have a finished product they can be proud of, and an interest in getting it published. A lot of folks in this position today are looking ahead a year or two years and wondering why they won’t just self-epublish. Myself, I think I’ll want a traditional publication deal if I can get one – but I’m concerned whether agents will even be able to sell to traditional publishers in an environment taxed by such potential conflicts of interest. So I’m looking to understand these changes better – which is why I felt I should ask the question. If there really is a fundamental difference in the execution or failure to execute on fiduciary responsibility between these two models, I’m keen to understand it.


  34. @Stephen A. Watkins: What Stephen said (without the “s”, lol–don’t take that the wrong way, Stephen).

    I know, Courtney, that you think long and hard about these conflict of interest/ethical things and you’re probably WAY more practiced than I am on the subject, but I think your dismissal of the issue in the case of a 15% commission splits hairs a little too finely. With TKA’s recent announcement that they will be offering “self-publishing assistance” (which, based on the letter they sent out, is a publishing arm by another name), it’s very easy to see how the potential for conflict is there even when the percentages are the same.

    Simple example? Well, TKA’s letter says they’ll be happy to self-publish front-list titles that “mainstream publishers may not consider remunerative enough for acquisition.” Okay, great, but doesn’t that create an inherent incentive for TKA to take on more clients whose work falls into that sphere? In other words, if they get a great submission but it isn’t really marketable to major publishing houses, isn’t there a very real possibility that they might offer representation to the author anyway, knowing full well that while they won’t be able to sell it to a mainstream publisher, they WILL be able to get their 15% by publishing it themselves? In the past, agents have rejected many books, not because they didn’t LIKE the book or the author’s voice, but because they knew the market for that book simply didn’t exist. With the advent of self-publishing arms, there’s now “room” in agents’ lists for these kinds of books and these kinds of authors, yet it’s got a very real potential for being a “bait-and-switch” operation; the author THINKS they’ve gained representation and the opportunity to sell to a major publisher when all along, the agent is anticipating releasing the book through its own publishing arm.

    And again, the agent doesn’t even have to engage in this practice for the suspicion to arise. All that has to happen is for the agent to fail to sell the book and suggest that the author publish through its digital publishing service instead. How do I know whether the failure to sell was because the book wasn’t good enough, my agent was “lazy”, or my agent simply thought he/she could do better monetarily by publishing it him/herself? Answer: I don’t. And THAT is the heart of conflict of interest, isn’t it?

    IMO, 15% models are just as fraught as 50% models; the only difference is in the egregiousness of the arrangement.

  35. Stephen and Jackie,

    You’re both answering excellent questions, and my response is getting unmanageably long, so will be another blog post.

    The short version is: I can see why what you are describing makes you uneasy. You’ll note that what I say above is “this doesn’t amount to a breach of fiduciary duty.” Which is to say, if properly structured, the agent is not doing anything except on the author’s behalf.

    But I think there are a ton of salient differences between assisted self-publishing and agency services–although I also think that agency services done wrong cross the line.

    That doesn’t mean that I necessarily think it’s a good idea, or that I think people can’t object to it as a vertical integration of services that might impermissibly blur lines they don’t want blurred.

    I’m not trying to say that it’s a categorically good thing or that everyone must accept it–just that I don’t believe it’s a breach of an agent’s fiduciary duties.

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