Simon & Schuster Slapped with Ebook Royalty Class Action Lawsuit
A book is a book, except when it comes to ebook royalties. That's the premise of a class action lawsuit filed on Thursday, May 19, 2016, in the Supreme Court of the State of New York by class representative Sheldon Blau, MD.
The lawsuit alleges Simon & Schuster has been cheating its authors by improperly categorizing ebook transactions as "sales" rather than "licenses."
The distinction is significant, because the royalty rate for sales is much lower than the rate for the license of rights. If categorized as a license the author receives 50% of net receipts, rather than 25% of net typically paid to authors for the "sale" of an ebook.