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May 1, 2013
By Andrew Albanese
Filed in the Southern District of New York, the suit seeks damages in excess of $5 million and, in a twist, is before a judge that has some background in publishing—Judge Denise Cote, currently presiding over the ongoing e-book price-fixing scandal.

Three authors have filed suit against self-publishing service provider Author Solutions, and its parent company Penguin, airing a laundry list of complaints and alleging the company is engaged in deceitful, dubious business practices. “Defendants have marketed themselves as an independent publisher with a reputation for outstanding quality and impressive book sales," the complaint reads. "Instead, Defendants are not an independent publisher, but a print-on-demand vanity press.”

The suit, which seeks class action status, alleges that Author Solutions misrepresents itself, luring authors in with claims that its books can compete with “traditional publishers,” offering “greater speed, higher royalties, and more control for its authors.” The company then profits from “fraudulent” practices, the complaint alleges, including “delaying publication, publishing manuscripts with errors to generate fees, and selling worthless services, or services that fail to accomplish what they promise.” The suit also alleges that Author Solutions fails to pay its authors the royalties they are due.

Filed in the Southern District of New York, the suit seeks damages in excess of $5 million and, in a twist, is before a judge that has some background in publishing—Judge Denise Cote, currently presiding over the ongoing e-book price-fixing scandal. The authors, and the potential class is being represented by Oren Giskan of the New York-based firm Giskan Solataroff, Anderson and Stewart.

This case could strike a nerve, as it comes at a boom time for self-publishing, and recalls a dark self-publishing past—the days of the Vanity Press—when unsuspecting authors were wooed in by companies, only to be saddled with expensive fees and left with stacks of sub-par print books. In July of last year Penguin purchased Author Solutions, for a reported $116 million, and the complaint puts the company’s annual revenue at over $100 million. Author Solutions also partners with other publishers, including a recent deal with Simon and Schuster’s Archway Books.

In a prepared statement, Author Solutions pointed to the fact that it has "successfully enabled more than 170,000 authors to self-publish more than 200,000 titles," and noted that it has received an "A" rating from the Better Business Bureau. The company said it "will correct the false and misleading claims made about Author Solutions in the appropriate legal forum."

It remains to be seen if the case has any legal merit, but it makes for fascinating reading, and one can certainly imagine a large contingent of similarly discontented self-published authors who would love a peek behind the self-publishing curtain. In the complaint, all three named plaintiffs (Kelvin James, Jodi Foster, and Terry Hardy) detail their experiences: paying thousands of dollars, being upsold into “developmental” packages for editing and marketing services which either did not materialize or provided subpar service and, in the process, generated fees for Author Solutions. Author Solutions, the complaint alleges, has even created a collection of “imprints” to deceive would-be authors into thinking there are specialized publishing programs, which there are not. The company's true business is not publishing, the complaint stresses, but selling services to authors.

The complaint also alleges that Author Solutions's royalty practices are either misleading or not properly paid out, with even some authors listed as bestsellers on Amazon, the complaint states, told they have no reported sales, and, that it is difficult if not impossible to get a correct sales accounting.

The next step now awaits and Author Solutions and Penguin will answer the suit—but things could ramp up quickly. After all, for all the self-published success stories, there are surely many unhappily self-published authors, as well as a growing number of services available. And, as is common with class action suits, it will be interesting to see if other firms file “copycat” cases, as often happens, and happened in the consumer e-book case.

“Marketing and advertising itself as an independent publisher invested in creating quality titles, when in fact, Defendants are a print-on-demand vanity press is unlawful,” the suit alleges. “There is no benefit to consumers or competition by falsely advertising that Defendants operate as an independent publisher and by failing to disclose the true nature of its business. Indeed, the harm to consumers and competition is substantial.”

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