The US textbook industry is currently valued at over $7 billion dollars and each print edition normally costs over $200. In some cases students simply can’t afford them anymore and opt instead to download textbooks illegally. A report last month by the Book Industry Study Group, found that 25% of students photocopied or scanned textbooks from other students, up from 17% in 2012. The number of students who acquired textbooks from a pirate website climbed to 19% from 11%. The publishing industry is raking in a lot of money, but are authors getting paid properly?
Two authors don’t think their royalty rates are scaling with the rising cost of textbooks and a New York Court has just granted them class action status against Pearson Education for failing to pay proper royalties.
According to Publishers Weekly “The case was first filed last October by two plaintiff authors, Lawrence J. Gitman and Michael D. Joehnk, emeritus professors and the authors of several popular finance textbooks. The authors allege that Pearson has been “systematically shortchanging textbook authors on the royalties they are owed.”
In filings, the authors note that textbook prices have climbed 82% over the last decade, but that royalty payments for authors have risen only modestly. They claim that a recent audit revealed that the price of one their textbooks, Fundamentals of Investing, rose 140% from 2000 to 2011 (from $108 a copy to $260), yet, due to a range of alleged accounting tricks, their royalties over the same period remained “virtually stagnant.” Gitman and Joehnk claim they are owed roughly $470,000 in additional royalties in total, and that their fellow Pearson authors are likely owed millions more.
How many millions more? In their bid to sink the class action claims against them, Pearson attorneys acknowledged that the potential class could be “tens of thousands of authors.”