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Literary Scams

Publishers and Scams

The best defense against fraud and bad deals is a combination of skepticism and adequate information. If you've come here, you hopefully have the skepticism already.

More so in the printing segment of publishing than anywhere else, there is in fact objective information available to help avoid fraud and bad deals. Unfortunately, it is difficult to come by, and its reliability is difficult to assess.

Remember that Money flows toward the author, and you won't go far wrong.

Last Updated: 04 July 2005

Persons and Entities

This alphabetical index will jump you to the relevant discussion below.

Publishamerica

Sometimes vanity presses try desperately to avoid being so labelled, particularly when they can't even be bothered to comply with their own contracts. One of the primary examples of this is PublishAmerica ("PA"), a vanity press based in Frederick, Maryland that preys on its authors. At least its scheme is a little bit inventive: the authors end up paying for copies of their books, because virtually nobody else will buy them (or even can, as all but a handful of PA titles are nonreturnable and thus not stocked in bookstores).

I will certainly be posting more material on PublishAmerica's scheme in the future; for now, though, one of PublishAmerica's other practices has come under substantial scrutiny. On 08 August 2005, the Encyclopedia Britannica folks sued PA in Chicago for trademark infringement (complaint (PDF, 250kb)). This is consistent with other disrespect for trademarks demonstrated by PA: PA has cybersquatted on the domain name for one of its most persistent critics for several years.

Press-TIGE Publishing; Martha Ivery; Kelly O'Donnell

Most of the following material has been on the site for some time, and is rapidly approaching obsolescence—as to this particular scheme. However, it remains an excellent object lesson in how these scams work.

Vanity presses, under whatever name, are seldom a good choice for authors. The few "success stories" of authors using vanity presses and then finding their way to literary fame and fortune are not only exceedingly rare—even rarer than a first-time author doing so through traditional publishing—but they are almost invariably from nonstandard publishing environments (before the current industry structure was established, or in niches that don't follow the normal "rules"). Aside from this, they are horribly overpriced, and often produce shoddy goods (if at all, as many vanity presses are outright scams).

One of the most egregious examples of the problems with vanity presses in the last few years has been Press-TIGE Publishing, Inc., of Catskill, NY. This is an outright scam: the owner, Martha Ivery, has also posed as an agent (Kelly O'Donnell, The Kelly O'Donnell Literary Agency, Writers Information USAgency) and as an editor (Kelly O'Donnell and at least one other guise). Many complaints and extensive documentation demonstrate that Press-TIGE doesn't print the books that authors pay for, had no ability to do so, and probably never intended to do so.

Bankruptcy Procedings

On 19 June 2002, Press-TIGE filed for bankruptcy liquidation under chapter 7 of the Bankruptcy Code. In re Press-TIGE Publishing, Inc., No. 02-14014 (N.D.N.Y.) (Littlefield, J.). The petition lists nearly $200,000 in debts (over 75% of which concerns unfulfilled author contracts) and $10,000 in assets, and asserts that unsecured creditors are unlikely to receive anything. Examination of the petition indicates that the debts were substantially underreported. Court records indicate that notification letters have been sent to those creditors actually disclosed.

If you, or someone you know, has ever paid anything to Press-TIGE, Martha Ivery, Kelly O'Donnell, or either of the agencies, consult counsel now. After discussion with the Trustee (see below), it appears that the best course of action is to send the Trustee the following documents as soon as possible:

You may at this time begin attempting to find a legitimate publisher for your book(s). Hopefully you know some of the warning signs by now, but visit Writer Beware first! If you get a solid offer on one of your books, check this site first for progress on the Press-TIGE case, and if necessary consult counsel.

The Trustee is Gregory Harris, The Patroon Building, 5 Clinton Square, Albany, NY 12207. The first meeting of creditors is presently scheduled for 26 July 2002 at 1:00. Further details will be posted as appropriate as they become available.

Update, 27 July 2002: The first meeting of creditors began as scheduled, and will resume at noon on 20 August 2002. Ms. Ivery disregarded orders to bring certain required documentation to the hearing, and was ordered again to do so.

Of somewhat greater importance, Ms. Ivery admitted under oath that New Millennium Publishing House is also her operation, regardless of what persons purport to sign letters for New Millennium. (Note: There is more than one publisher that goes by the name New Millennium; this one is variously listed as in Leeds or Catskill, New York.) She also admitted under oath that she unilaterally transferred some unfulfilled publishing contracts from Press-TIGE to New Millennium. Needless to say, the Trustee was not amused.

Update, 07 September 2002: At the 20 August hearing, Ms. Ivery did herself no favors. Further details await the formal transcript.

Ms. Ivery has admitted that she is still soliciting business under different aliases and business structures. I advise extreme caution dealing with anyone related, however, marginally, to publishing whose address is in Leeds or Catskill, New York. Contact Writer Beware before you even submit anything to such an address, let alone sign anything.

Update, 01 January 2005: The bankruptcy matter has terminated. Authors should treat their rights as returned; any property that was not returned is probably still tied up in the criminal proceedings.

Criminal Preliminaries

A federal search warrant on Press-TIGE and Martha Ivery was executed on 26 September 2002. The federal authorities state in substance as follows:

I have also been informed that Ms. Ivery has retained counsel of her own in this matter.

If you have had dealings with Martha Ivery in any capacity, or with any of her known business identities or organizations—which may include any publishing-related business based in Leeds or Catskill, New York—run, do not walk to either counsel of your own choice or to Mr. Silver. Although this is not legal advice for your particular situation, I do not recommend making contact with or responding to contact from Ms. Ivery at this time.

Although the FBI has not specifically asked for such information, it will be extremely helpful if you gather the following documents and information and have them handy:

Martha Ivery Indicted for Fraud

On Wednesday, 01 June 2005, the United States Attorney for the Northern District of New York filed an indictment against Martha Ivery, aka Kelly O'Donnell, dba Press-Tige Publishing. No. 05–CR–251 (FJS) (N.D.N.Y. Jun. 1, 2005) (pending). The complaint asserts fifteen counts of mail fraud (18 U.S.C. § 1341) and acts against the United States as a principal in a conspiracy (18 U.S.C. § 2); one count of improper use of an electronic access device—legalese for "credit-card fraud not involving the mails" (18 U.S.C. § 1029); and one count of false sworn testimony in a bankruptcy proceeding (18 U.S.C. § 152). Ivery was to be arraigned today (03 June 2005) at 1pm.

As is usual in indictments of this nature, not all of the known and provable misconduct appears in the indictment itself. For example, the fraud counts concern only sixteen victims (about the square root of of the documented number), with total losses of $55,000 (versus a known "toll" of well over half a million dollars), and only one of nine documentable instances of false sworn testimony before the bankruptcy trustee. Later today, I will discuss the potential sentence at Scrivener's Error. For the moment, what's important to note is the statutory maximums: twenty (20) years on the fraud counts, and five (5) years on the false testimony count. Although the mechanics need to wait for that analysis on the blawg, the corollary is that perjury-like offenses are not grouped with fraud-like offenses for determining the sentences—and that the Guidelines recommend that the sentence for perjury-like offenses runs consecutively, not concurrently, with any other offense.

The the indictment, in very terse language, offers a real window on the way schemes of this nature operate.

The judge's standard scheduling order contemplates trial in August 2005, but that would be almost unheard of in a white-collar crime case.

Martha Ivery Pleads Guilty

On Monday, 05 December 2005, after several routine continuances, Martha Ivery pled guilty to all counts in the indictment. Sentencing is scheduled for 28 April 2006 at 11:30am in Albany.

According to the U.S. Attorney's press release, the US was prepared to prove up two hundred victims and well over a half million dollars in losses attributable to Ivery's multilayered fraudulent scheme. This should result in substantial jail time, even allowing for some credit for "acceptance of responsibility."

Update, 11 August 2006: The sentencing hearing originally set for next Monday (14 August 2006) has been delayed for cause until 22 September 2006 at the defense's request. The prosecutor's sentencing memo, which is a public document that was filed on 27 July 2006, suggests that an appropriate sentence would include 57 to 71 months of imprisonment—only slightly less than I had suggested in my analysis referred to in the preceding paragraph. For comparison, Dorothy and Charles Deering of the unlamented Sovereign Press were sentenced to 46 and 41 months of imprisonment respectively (US v. Deering, No. 99cr76 (E.D. Ky.)). Ms Ivery's counsel has not yet submitted his sentencing memorandum.

The above commentary is not legal advice for your particular situation. If you have any questions about whether the procedures described above are in your best interest, you should consult independent counsel immediately. I have an unrelated conflict of interest that would prevent me from assisting you.

NorthernLight.com and the divine, Inc. Bankruptcy

The point of Tasini was to ensure that authors' rights are not violated by publishers grabbing uncontracted rights based on new technology. One of the main defendants in Tasini was Nexis, a huge online electronic database primarily of periodical articles. Unfortunately, the electronic database industry has done its best to ignore Tasini and put the onus on authors. One of the most prominent such databases has been NorthernLight.com. (The currently available link won't illustrate much.)

Just to make things nice and complicated, NorthernLight was purchased by divine, Inc., a Chicago-based "dot-com" with some other subsidiaries. One of those subsidiaries accepted $74 million dollars from libraries across the country to renew periodical subscriptions. That money has disappeared. divine, Inc., has thus filed for bankruptcy in the District of Massachusetts, No. 03-11472.

The problem for authors arises from the operation of the Bankruptcy Code. No lawsuit against NorthernLight can go forward during the bankruptcy proceedings without special order of the Court (11 U.S.C.  562). Further, NorthernLight, as an asset of divine, could well be merely sold off to another bidder in an attempt to find that $74 million and change. This would add another layer of bureaucracy to authors' efforts to get Tasini compliance out of NorthernLight, particularly if another existing database provider purchases NorthernLight and folds it in.

Even more dangerous, divine could emerge from bankruptcy still in control of NortherLight; the discharge in bankruptcy then would extinguish all existing claims. That means no compensation or other remedies would be available for past infringements. Thus, authors need to follow this matter closely.

Authors who have had their works infringed by NorthernLight in the past need to determine whether to file a proof of claim (instructions are on the court's website, FAQ for creditors). The time to do so is limited—the filing must be made within sixty days of the meeting of creditors, which is scheduled in the relatively near future (early April 2003). Filing a proof of claim does not require paying an attorney or a filing fee (only sending copies to about six place). The most important thing will be to have proof that the copyright holder's work was made available for sale on NorthernLight's website. A "claim" does not require that you filed suit against NorthernLight, or even complained—only that you have a bona fide belief that, in law, NorthernLight owes you money for use of your copyrighted material without authorization.

Admittedly, there may not be much money in it for the authors. However, failing to act will forfeit any rights (including injunctive relief).

Update, 04 July 2005: The divine, Inc. bankruptcy proceedings are winding down toward final dissolution. All claims that are going to be paid have been paid. In any event, the statute of limitations has run on any new copyright-based claims.

The above commentary is not legal advice for your particular situation. If you have any questions about whether the procedures described above are in your best interest, you should consult counsel immediately.

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Charlie Petit
cepetit@scrivenerserror.com

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