Harlequin e-Book Royalties Class Action Settlement

A settlement has been proposed in a class action lawsuit that alleges Harlequin Enterprise Limited, Harlequin Books S.A. and Harlequin Enterprises B.V. breached their contracts with novelists, depriving the writers of a portion of the royalties to which they are entitled for Harlequin’s publication of their romance novels as e-books.

The Harlequin e-book class action lawsuit was initially filed in July 2012 on behalf of authors who entered into publishing agreements with the Harlequin defendants between 1990 and 2004.

According to the plaintiffs, the publishing agreements do not include specific information about the royalties they would receive for e-books; therefore, issues related to e-books are covered by an “All Other Rights” clause that says:

“On all other rights exercised by Publisher or its Related Licensees fifty percent (50%) of the Net Amount received by Publisher for the license or sale of said rights. The Net Amount Received by the exercise, sale or license of said rights by Publisher from a Related Licensee shall, in Publisher’s estimate, be equivalent to the amount reasonably obtainable by Publisher from an Unrelated Licensee for the license or sale of said rights.”

According to the Harlequin class action lawsuit, the amount due to novelists under this “All Other Rights” clause is further complicated by the relationship of the Harlequin defendants. The plaintiffs claim that they entered into the publishing agreements with Harlequin Books S.A. or Harlequin Enterprises B.V., which are foreign subsidiaries. These subsidiaries subsequently licensed the works to Harlequin Enterprises, which published the novels as e-books.

The plaintiffs contend that the 50 percent of the amount paid by Harlequin Enterprises to its foreign subsidiaries is less than the amount that would be obtainable from an unrelated licensee. They contend that the licensing fees Harlequin Enterprises paid to the foreign Harlequin subsidiaries did not comply with the contractual language in the “All Other Rights” clause.

The Harlequin defendants deny any wrongdoing but agreed to settle the e-book royalties class action lawsuit to avoid the burden, expense and risk of further litigation.

Under the terms of the Harlequin e-book settlement, the Harlequin defendants will pay a total of $4.1 million to resolve the class action lawsuit.

Who’s Eligible

You are a Class Member of the Harlequin e-book royalties settlement if:

• You are a person or other entity in the United States, Canada, the United Kingdom, the Republic of Ireland, Australia or New Zealand;
• You entered into, or acquired the author’s rights in, one or more standard form book publishing agreements with Harlequin Books S.A. or Harlequin Enterprises B.V. between 1990 and 2004;
• The publishing agreement includes an “All Other Rights” clause with language similar to the clause quoted above;
• Your written work published pursuant to the book publishing agreement has been published by an e-book; and
• You do not exclude yourself from the Harlequin class action settlement by June 6, 2016.

NOTE: IF you are the heir of someone who qualifies as a Class Member or if a Class Member assigned you his or her rights, you are a Class Member of this Harlequin settlement and may be entitled to benefits.

Potential Award

Varies. The payment each Class Member will receive will be allocated pro rata based on the amount of royalties they received from or were owed by Harlequin pursuant to the “All Other Rights” clause for the sale of e-books through Dec. 31, 2015.

Proof of Purchase

N/A

Class Notice

CLICK HERE TO VIEW THE CLASS NOTICE (PDF) »

Claim Form Deadline

N/A. Class Members who do not opt out of the Harlequin settlement by June 6, 2016 will automatically receive benefits.

Case Name

Keiler, et al. v. Harlequin Enterprises Limited, et al., Case No. 12-cv-05558 (WHP), in the U.S. District Court for the Southern District of New York

Final Hearing

06/30/2016

Settlement Website

www.HarlequinSettlement.com

Claims Administrator

Harlequin Class Action Settlement
c/o GCG
P.O. Box 9349
Dublin, OH 43107-4249
1-800-231-1815
info@HarlequinSettlement.com

Class Counsel

David B. Wolf
DAVIDWOLFLAW PLLC

Defense Counsel

Jay Cohen
Daniel J. Leffell
Jesse S. Crew
PAUL WEISS RIFKIND WHARTON & GARRISON LLP