The writing loops have exploded with news that literary agencies are opening up self-publishing businesses for their clients as well as other writers. While these folks may have the best of intentions, this violates the law of agency—if the agent is both the agent and the publisher.
Yeah, I know ‘violates’ is a tough word. Here’s a definition of agency law: The law of agency is an area of contract law when a person, called the agent, is authorized to act on behalf of another (the author in this case) to create a legal relationship with a third party(the publisher in this case). The term “third party” pretty much shows us what’s wrong with a literary agent also acting as a publisher.
(Note: An agent assisting an author with self-publishing is different from an agent opening up a publishing business.)
So, when an agent negotiates with a publisher for a deal—how in the world does an agent
negotiate with herself for the deal? Can’t be done. No matter how honorable and good intentioned the agent (and I truly believe these folks are both), it is physically impossible to sit on opposite sides of a table at the same time. We only have one butt, and it has to be in one chair.
An agent owes a fiduciary duty to his/her client—and the agent’s goal can never be counter-productive or opposite to the client’s. There’s no way an agent can fight hard for her client—when she’s fighting with herself and her bottom line. No matter how nice the agent.
So, is there a conflict of interest? Yep. Anything that isn’t directly in the client’s interest…is a conflict.
This has nothing to do with trust, loyalty or track record. Agency law is…agency law. It’s quite simple.
CYA Disclaimer: This is not legal advice. If you need legal advice, hire a lawyer. Especially if you’re in Colorado, Utah, or Wyoming. Those guys need to buy skis every year — and boy are those expensive. The opinions expressed, while brilliant, are mine and you should get your own. In fact, there are so many lawyers out there right now, law schools are cutting down on admissions. We only want to tempt fate so much.