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>Beware Of Lit Agent BK Nelson

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TUESDAY, SEPTEMBER 28, 2010

Unhappy Client Suing B.K. Nelson Inc. Literary Agency

Posted by Victoria Strauss for Writer Beware

An article from Courthouse News Service (a nationwide newsletter for lawyers focusing on civil litigation) caught my eye this morning:

A retired lawyer claims he wrote a book investigating the death of Princess Diana, and his agent extorted thousands of dollars from him to market the book. Paul Anthony Spletzer…sued BK Nelson and her eponymous firm, whom he says he hired to represent him for 20 percent commission.

“In negotiating her fee, defendant Nelson, when questioned by Spletzer as to why she charged 20 percent commission, which is believed to be twice as much as other agencies, replied that she, she personally, was worth it,” the complaint states.
Spletzer says Nelson told him that he “would receive not less than $250,000 and probably $450,000 plus royalties for the rights” to his book by selling it as a film.

He claims she asked him to pay $4,000 so she could create a DVD trailer of “Her Necessary Death” and market the book to the entertainment industry in New York and Hollywood.

“Defendants stated that this trailer would be similar to the trailers seen on HBO or Showtime or those presented as coming attractions in movie houses … that there would be actors presenting the theme of the work entitled ‘Her Necessary Death,'” according to the complaint.

Spletzer says he received the trailer in May, but that it “is worthless.”

The full complaint, which demands millions of dollars in compensatory and punitive damages, can be seen here.

Also noted in the article: B.K. Nelson Inc. is one of nineteen literary agencies on Writer Beware’s Thumbs Down Agency List. We’ve been receiving complaints and advisories about the agency since 1999, including:

– A 20% commission (a handful of reputable agents do charge 20%, but the prevailing standard is 15%).

– An evaluation fee of $350, plus an additional fee of between $3.00 and $5.00 per page if the manuscript isn’t finished.

– A fee of $250-400 to represent subsidiary rights at various book fairs.

– A fee of $450 to be included in a Speakers’ Directory.

– A fee of $2,000 to feature an author and manuscript at BEA.

– Editing fees of as much as $4,500.

– Thousands of dollars charged to a client to produce a “professional trailer” to present to the entertainment industry. This client isn’t Mr. Spletzer (I’m withholding the exact amount paid to protect the client’s identity), but had a similar opinion of the trailer, describing it as something that “could have been done by a high school student.”

And that’s just the documented complaints.

The agency’s website describes B.K. Nelson Inc. as “one of the leading agencies in the nation,” which “has had a strong impact on the careers of writers world wide.” However, the agency’s client listreveals little evidence of recent sales. Of the clients on the list, several don’t turn up in any websearch. For others, the referenced titles are incorrect, or don’t seem to exist at all. Two clients have books with fee-based companies (Xlibris and Tate–possibly placed with these companies by the authors themselves). For the book authors and titles that do check out, there are some reputable publishers–but few recent publication dates (most of the pub dates are 2004 and earlier).

I’ll be following the progress of Mr. Spletzer’s lawsuit, and will report back.

>Beware Of Lit Agent BK Nelson

>

TUESDAY, SEPTEMBER 28, 2010

Unhappy Client Suing B.K. Nelson Inc. Literary Agency

Posted by Victoria Strauss for Writer Beware

From An article from Courthouse News Service (a nationwide newsletter for lawyers focusing on civil litigation):

A retired lawyer claims he wrote a book investigating the death of Princess Diana, and his agent extorted thousands of dollars from him to market the book. Paul Anthony Spletzer…sued BK Nelson and her eponymous firm, whom he says he hired to represent him for 20 percent commission.

“In negotiating her fee, defendant Nelson, when questioned by Spletzer as to why she charged 20 percent commission, which is believed to be twice as much as other agencies, replied that she, she personally, was worth it,” the complaint states.
Spletzer says Nelson told him that he “would receive not less than $250,000 and probably $450,000 plus royalties for the rights” to his book by selling it as a film.

He claims she asked him to pay $4,000 so she could create a DVD trailer of “Her Necessary Death” and market the book to the entertainment industry in New York and Hollywood.

“Defendants stated that this trailer would be similar to the trailers seen on HBO or Showtime or those presented as coming attractions in movie houses … that there would be actors presenting the theme of the work entitled ‘Her Necessary Death,'” according to the complaint.

Spletzer says he received the trailer in May, but that it “is worthless.”

To read the entire story, please click on http://www.accrispin.blogspot.com/
The full complaint, which demands millions of dollars in compensatory and punitive damages, can be seen here.

>Consumers Face Off Against Credit Card Companies

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Credit Card Industry Aims to Profit From Sterling Payers

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Published: May 18, 2009

Credit cards have long been a very good deal for people who pay their bills on time and in full. Even as card companies imposed punitive fees and penalties on those late with their payments, the best customers racked up cash-back rewards, frequent-flier miles and other perks in recent years.

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Now Congress is moving to limit the penalties on riskier borrowers, who have become a prime source of billions of dollars in fee revenue for the industry. And to make up for lost income, the card companies are going after those people with sterling credit.
Banks are expected to look at reviving annual fees, curtailing cash-back and other rewards programs and charging interest immediately on a purchase instead of allowing a grace period of weeks, according to bank officials and trade groups.
“It will be a different business,” said Edward L. Yingling, the chief executive of the American Bankers Association, which has been lobbying Congress for more lenient legislation on behalf of the nation’s biggest banks. “Those that manage their credit well will in some degree subsidize those that have credit problems.”
As they thin their ranks of risky cardholders to deal with an economic downturn, major banks including American Express, Citigroup, Bank of America and a long list of others have already begun to raise interest rates, and some have set their sights on consumers who pay their bills on time. The legislation scheduled for a Senate vote on Tuesday does not cap interest rates, so banks can continue to lift them, albeit at a slower pace and with greater disclosure.
“There will be one-size-fits-all pricing, and as a result, you’ll see the industry will be more egalitarian in terms of its revenue base,” said David Robertson, publisher of the Nilson Report, which tracks the credit card business.
People who routinely pay off their credit card balances have been enjoying the equivalent of a free ride, he said, because many have not had to pay an annual fee even as they collect points for air travel and other perks.
“Despite all the terrible things that have been said, you’re making out like a bandit,” he said. “That’s a third of credit card customers, 50 million people who have gotten a great deal.”
Robert Hammer, an industry consultant, said the legislation might have the broad effect of encouraging card issuers to become ever more reliant on fees from marginal customers as well as creditworthy cardholders — “deadbeats” in industry parlance, because they generate scant fee revenue.
“They aren’t charities. They have shareholders to report to,” he said, referring to banks and credit card companies. “Whatever is left in the model to work from, they will start to maneuver.”
Banks used to give credit cards only to the best consumers and charge them a flat interest rate of about 20 percent and an annual fee. But with the relaxing of usury laws in some states, and the ready availability of credit scores in the late 1980s, banks began offering cards with a variety of different interest rates and fees, tying the pricing to the credit risk of the cardholder.
That helped push interest rates down for many consumers, but they soared for riskier cardholders, who became a significant source of revenue for the industry. The recent economic downturn challenged that formula, and banks started dumping the riskiest customers and lowering their credit limits in earnest as the recession accelerated. Now, consumers who pay their bills off every month are issuing a rising chorus of complaints about shortened grace periods, new hidden fees and higher interest rates.
The industry says that the proposals will force banks to issue fewer credit cards at greater cost to the current cardholders.
Citigroup and Capital One referred comments to the A.B.A. Discover and American Express declined to comment. Bank of America intends to “provide credit to the largest number of creditworthy customers possible, while also remaining prudent in our lending practices,” said Betty Riess, a spokeswoman. Together with JPMorgan Chase, which has said the changes will force it to limit credit availability and raise fees, these banks account for 80 percent of the credit card industry.
Banks are not required to publicly reveal how much money they make from penalty interest rates and fees, though government officials and industry consultants estimate they constitute a growing portion of revenue.
For instance, Mr. Hammer said the amount of money generated by penalty fees like late charges and exceeding credit limits had increased by about $1 billion annually in recent years, and should top $20 billion this year.
Regulations passed by the Federal Reserve in December to curb unexpected interest charges would cost issuers about $12 billion a year in lost fees and income, according to industry calculations. The legislation before Congress would build on the Fed rules and would further squeeze banks’ revenue when they are being hit with a high rate of credit card charge-offs. The government’s stress tests showed that the nation’s 19 biggest banks will take on $82 billion in credit card losses in the next two years.
A 2005 report by the Government Accountability Office estimated that 70 percent of card issuers’ revenue came from interest charges, and the portion from penalty rates appeared to be growing. The remainder came from fees on cardholders as well as retailers for processing transactions. Many retailers are angry at the high fees and plan to pass them on to shoppers once the Congressional legislation takes effect.
Consumer advocates say they have little sympathy for credit card issuers, arguing that they have made billions in recent years with unfair and sometimes deceptive practices.
“The business model will change because the business model doesn’t work for the public,” said Gail Hillebrand, a senior lawyer at Consumers Union.
“In order to do business under the new rules, they’ll actually have to tell you how much it’s going to cost,” she said.
With many consumers mired in debt and angry at what they consider gouging by credit card companies, the issue of credit card reform has broad populist appeal. Members of Congress and the Obama administration have seized on the discontent to push reforms that the industry succeeded in tamping down when the economy was flying high.
Austan Goolsbee, an economic adviser to President Obama, said that while the credit card industry had the right to make a reasonable profit as long as its contracts were in plain language and rule-breakers were held accountable, its current practices were akin to “a series of carjackings.”
“The card industry is giving the argument that if you didn’t want to be carjacked, why weren’t you locking your doors or taking a different road?” Mr. Goolsbee said.

Ron Lieber contributed reporting.
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