Fire Your Agent

Galaxy's Edge co-author Nick Cole forwards a dire warning to authors from Kristine Kathryn Rusch.

Fire Your Agent

Here's KKR:
The news broke publicly over the holiday weekend. If you blinked, you missed it.
The bookkeeper for a prestigious New York literary agency pled guilty to embezzling millions from the agency, leaving the agency “on the brink of bankruptcy.”
Donadio & Olson has existed for 49 years. Started by legendary agent Candida Donadio, the agency has represented some of the biggest names in fiction for decades.
The curated-to-impress client list on Donadio & Olson’s website includes Chuck Palahnuik, and McKay Jenkins, as well as dozens of estates from Mario Puzo’s to Peter Matthiessen’s. (As well as the estate of an old colleague of mine. Pout.)
The New York Post article, which is what I saw initially, called the perpetrator the accountant for the agency. The actual legal complaint calls him the bookkeeper.  The actual criminal charges against the bookkeeper, Darin Webb, were filed on May 15 in federal court. Webb was charged with wire fraud for embezzling $3.4 million. A forensic audit is now occurring at Donadio & Olson, and there is speculation that the amount of money Webb stole will go much, much, much higher.
Here are the facts of the case as reported in the press. $200,000 that an unnamed writer represented by Donadio & Olson expected last year never arrived. The writer kept contacting Webb, who lied about what was going on with the money. Finally, fed up with the delay, the writer contacted someone else at Donadio & Olson. (That person isn’t named either.)
Apparently, that contact opened a huge can of ugly. If you read the account on Law360, what you see behind the calm words of the reporting is a short tale of an agency in panic.
The agency should be panicking, because if they've let a potentially unqualified and now allegedly criminal "bookkeeper" manage their authors' accounts, they are in for an epic civil and criminal depantsing.

Donadio & Olson's eventual comeuppance offers cold comfort to their author clients, who will have to wait for the slow grinding of the American legal system before they see a dime in restitution. D&O's lawyer said they're striving to make their victimized clients "whole to the greatest extent possible", meaning they won't recover the full stolen amount.

How screwed are the authors whose royalties were embezzled? D&O's highest profile client, Fight Club author Chuck Palahniuk, is reportedly "close to broke" since Webb raided his account.

For the uninitiated who don't know how an author who's sold millions of books could be wiped out by a single crook--not at his publisher; at his literary agency--let me explain how agented authors get paid.
  1. A bookseller orders copies of the author's book from the publisher.
  2. Royalties from the order, minus returns, go into the author's account with the publishing house.
  3. Ever six months, the publisher issues a royalty statement to the author.
  4. But they cut a check to the author's agent.
  5. The publisher's check is deposited in yet another account kept by the agency.
  6. The agency sends the author a check for accumulated royalties minus the agent's 15% fee.
In this case, D&O's bookkeeper added an extra step, 5b: The bookkeeper skims money from the author's account.

By way of contrast, here's how I, an indie author, GET PAID!
  1. Readers buy my books from Amazon.
  2. Royalties from all sales go into my KDP account.
  3. Each month, Amazon pays me all royalties earned in the month ending 60 days ago.
Not only do my royalties pass through fewer hands (from the reader to Amazon to me), thus limiting points of failure, I get 60-70% of the list price instead of 8-25%. I also don't lose another 15% to an agent who's not only obsolete but who might be criminally negligent.

NB: 15% is clown shoes. Artists' representatives in all other fields get 10% by longstanding union rules. Only tradpub authors are beta enough to pay their less useful agents 50% more and vociferously thank them for the privilege.

As always, Nick Cole is right. If you have a literary agent, fire him now. If you've been querying agents, stop and withdraw all outstanding queries. If you're among the shrinking warren of masochists who're still set on breaking in to tradpub, skip the agent and hire an IP lawyer to handle the negotiations for a one-time fee.

Then kick yourself when Barnes & Noble folds, your publisher cancels your contract, and you opt to "dip your toes" in self-publishing anyway.

For aspiring authors who'd rather reach an audience and earn a living from their writing, consider this cautionary tale reason #2,564,9088 to skip the tradpub rejection carousel. Instead, hire your own editor for a one-time fee, pick your own cover artist, and self-publish through Amazon.

Being your own publisher also gives you full control over marketing decisions like giving your books away for free, which I'm doing right now.


  1. Also, how many fewer books would you sell if you had to sell at tradpub prices? I bet there is an additional cost to the author if you factor that in as well.

    I’d be curious to know the age demographics of those who read indie vs trad. I don’t think it’s just an economic paradigm shift, I think tradpubs audience is literally dying out, just like mainstream media.

    1. You're right. In Spain the kids don't read and that stas from various sources bear that out. Part of the reason is cultural but it's due to the high prices dearth of ebooks;ebooks that are deliberately overpriced compared to paper versions and computer games write large. The last are more fun relatively cheaper and entertain


    2. "I think tradpubs audience is literally dying out, just like mainstream media."

      If Worldcon is an accurate sample of the tradpub readership--and I think it is--you're right on the money.

  2. Wow! "Profit skimming" taken to the next level.

    How many authors are planning civil actions against both the bookkeeper *and* the agency?

    Inquiring minds want to know!

    1. Probably not all of them. Which is sad.

      Although as KKR points out, it will be years before any of the victims see a dime.

    2. Specifically sad that Chuck Palahnuik popped out with his mei culpa to the D&O Railroad -- "oh, just a bad actor, not the system that didn't tell me for months" -- which will do nothing but enable a broken system to continue to limp forward.

      With luck other D&O clients are sharpening stakes for this revenant's demise.

    3. "With luck other D&O clients are sharpening stakes for this revenant's demise."

      D&O is finished, regardless of its clients' actions.

      Literary agents are rent-seeking parasites and have been since before Amazon introduced the Kindle. There are no professional certifications or even qualifications required to be an agent. You could start calling yourself one tomorrow. The same cannot be said for IP lawyers, who know vastly more about contract law and negotiation than failed editors whose only value is having "lots of contacts" at the big 5 publishing houses.

      Wait till B&N folds. Then get your popcorn and watch the stampede for the exits.

    4. Brian
      Another call to dump agents



    5. Concur. The B&N bonfire of the vanities will be an exquisite display of hand wringing, out-and-out panic, and "tut, tut, this is fine" from all the right minions and their dying print-based publishers.

      Even popcorn slathered in butter and salt may not suffice.

      I'm thinkin' brisket.

    6. A follow up. She was the victim of embezzlement and so her advice to writers is both visceral and commonsenical. She's absolutely adamant that writers learn the business, be self aware to the deals and licenses they give then watch everyone like an eagle.
      So you, Nick Larry and others are right. Writing's a business so be a pro and be diligent in protecting your business

  3. Thanks for the free book. Really enjoyed the Strange Matter story. Was not expecting that ending. It would make for a great Twilight Zone/Outer Limits episode.

    1. You're welcome. "Strange Matter" was partly based on a bet I made with myself to see if I could write an M. Night Shyamalan-style story with a satisfying conclusion based on character instead of a contrived plot twist.