Law for writers - what to do if your publisher goes bankrupt
I have paid a publishing company a considerable sum of money to publish and market my book. Unfortunately the company has now gone into liquidation, they have not contacted me, and I am not sure where I stand. Can I get my money back? How should I go about it, and how long should I expect the process to take? Will I still be able to get the book published elsewhere?
If the company has gone into liquidation, you will need to deal with the liquidators. Your position is likely to depend on what your contract with the publishing company says, but there are a couple of possibilities.
If you are looking to reclaim the money you paid because the services have not been provided, you will need to claim as a creditor of the company, by notifying the liquidators and providing information about your claim. How much you receive will depend on what the other debts of the company are, and what assets it has. Assets will first be used to pay secured debts, costs, and employees, with unsecured creditors sharing what is left over. It is unlikely that you will receive the full amount you paid – it is fairly common for unsecured creditors to receive only a few pence per pound owing.
You do not say how you paid the fee. If you used a credit card or certain debit cards you may be able to obtain a refund from the card issuer or bank. You will have less protection if you paid by cash or cheque.
I assume that in paying the publishing company to publish and market the book you have not assigned any rights in it to them. You should, however, check whether you have granted them any exclusivity. As you have paid them to publish the book, it is less likely that they will have looked for exclusive rights, but any terms and conditions or other contract for the service should make this clearer. If you have granted exclusive rights the contract may allow you to terminate them in the event of the company’s breach or insolvency. In this situation you may need to contact the liquidators to formally terminate the contract before publishing elsewhere. You should check the terms carefully and if necessary take advice.
Our legal advice comes from Helen Goldthorpe, an associate solicitor specialising in intellectual property and information technology law at Irwin Mitchell LLP.