Tag s | Legal

Family Christian Stores Survive Bankruptcy

In case you missed the news, last Tuesday the court approved the sale of the Family Christian Stores (FCS) to FCS Acquisitions. The new owner is basically the previous owner since Richard Jackson was part of that company too (which I have written about before-click to read).

This sale, in essence, wipes clean over $120 million in debt that the stores owed. Their $75 million in assets will be purchased for an amount between $52.4 million and $55.7 million (finally tally determined at closing).

The publishers and suppliers (vendors) who were owed money had to vote to approve the sale and they did by a vote of 162-7. These vendors will receive a small portion of what they were owed. For example, if they had inventory on consignment at the stores (which FCS technically never owned) they will receive 35 cents on the dollar. For inventory that was never a payment the vendor will recieve around 15 cents on the dollar. While not much, it is more than any vendor would have received had the stores gone into liquidation.

Will 266 current locations the FCS management says they plan to keep more than 90% of them open, so expect some closures in the near future. This is not unusual in a situation like this as many of those stores may have leases coming up for renewal or the under-performing already.

Unfortunately a bankruptcy can have a domino effect on their vendors. A week ago Friday, Gospel Light Publications, a venerable publisher of church curriculum and Vacation Bible School curriculum declared bankruptcy (read this Wall Street Journal blog for more information). One of their reasons was that FCS owed them $143,000 and that loss, coupled with other challenges, made them unable to meet their financial obligations. This means printers, designers, staff, freelancers, and other will not be paid either. Dominos continue to fall.

For those of us in the writing community (agents and their author clients) we are still in a season of seeing the impact of the FCS bankruptcy on smaller royalty income for some clients. Since the publisher wasn’t paid, the author doesn’t get paid. So far the impact has been modest for most authors since FCS had been highly selective in the titles they have carried in their stores.

I am glad this is over so you don’t have to read my blogs about it any more! Seriously, it has been difficult to watch. We never like to see financial struggles. Especially in a business we love and participate in.

My hope is that the Family Christian Stores can use this to become a powerful tool in God’s kingdom. It is a tough retail environment out there.

If not, we may have to read about this again in the future…

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Name Brands in Fiction

So, you’re driving down the road, and you see a Ford F-350 with Monster wheels and an NRA bumper sticker. And you see a Toyota Prius with a Go Green bumper sticker. You know these are two different personalities driving the vehicles, right? You probably have formed an image already. …

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Defusing Contract Landmines

by Steve Laube

During the last six months we have run into some landmines buried within some small press contracts. In each case it was the author’s relationship with the publisher that helped land the offer, and so we proceeded to review the paperwork in order to protect the author’s interests.

In one case the small publisher was very grateful for our negotiations and contract changes. They plan to change their contract for all authors in the future. We were glad to help our client form that new partnership.

In two cases the publisher said they could not afford to hire a lawyer to review our requested changes to the contract and thus were unwilling to negotiate. We recommended the author walk away both times.

In yet another case the publisher wouldn’t negotiate and said, in essence, “take it or leave it.” We walked away. Our client terminated their relationship with us and signed the deal on their own.

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Happy 85th Birthday Mickey Mouse!

by Steve Laube

 On this day in 1928 the film “Steamboat Willie” made its debut. The main cartoon character (almost named Mortimer!) was featured and Mickey Mouse was born.

You might ask, “So what? Other than fun trivia, what does this mean to me as a writer?” Actually the success of Mickey Mouse and the Disney empire cuts to the heart of today’s copyright laws which affect you and your work. A quick recital of history and you’ll see how Mickey is either your friend or your adversary depending on your opinion of copyright protection.

In 1787 the Founding Fathers established a copyright term of 14 years, and if the author was still alive a renewal for an additional 14 years. Many years later it was extended to 28 years with a 28 year renewal option (a total of 56 years).

Then in 1976 Congress passed a new law that set three new and important rules:
a) copyright protection was defined as the life of the author plus 50 years
b) Material produced before 1922 was considered public domain
c) Material already under copyright in 1976 were given an extension. Their works were protected for 75 years instead of 56 years.

If you do the math, that meant that in 1997 some of these older works were going to start going into the public domain (and Mickey Mouse would become public in 2003). So the corporations began lobbying for a revision to the copyright law.

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News You Can Use – Feb. 7, 2012

Author Says McGraw-Hill Cheats on Royalties – Details of a pending lawsuit.

What is Pinterest? –  The latest craze in Social Media Networks. AuthorMedia shows you the simple steps to sign up and tips on how to use it in the next article below.

Three Ways an Author Can Use Pinterest – Last week an editor told me how she was following a couple of her authors on Pinterest and how much she liked it.

5 Ways to Break Out of the Social Media Doldrums – Well said by Aubre Andrus.

10 Ways to Ensure No One Will Read Your Blog Post – Ali Luke give great insight

How Hard Can it Be to Write a Kids Book? – Sally Lloyd-Jones helps dispel a common myth.

A very cool six minute video envisioning a future technology. Imagine computing being done on glass walls, desks, and even National Parks. From Corning. By the way, Corning makes the “Gorilla Glass” that you find on the iPad2.

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