Although non-compete clauses have become common in non-fiction publishing, they are not appropriate in novel publishing agreements. Unfortunately, I have too often seen sweeping non-compete terms in fiction agreements, especially with small and independent presses that “cut and paste” contract provisions from online samples. In some circumstances, these non-compete provisions can unreasonably restrict your future works.
Here’s a typical provision:
During the term of this Agreement, Author has not prepared or published, and shall not prepare or publish, or participate in the preparation or publication of any work that directly competes with the sales of the Work.
This provision actually states what already is an obligation of any author under both contract and copyright law – i.e., after an author has granted exclusive rights to a work, he or she cannot damage the sales of the work. The provision makes sense for a non-fiction publisher, especially when the non-compete is limited to a specific subject matter. But for fiction writers, it can have unforeseen consequences. Suppose you write a prequel or sequel to your novel, or use your novel’s characters in another novel, with a different publisher. This new work might be deemed to compete with the sales of the first work.
What can you do about it? There are several options. 1) First, try to delete the provision entirely. If that isn’t possible, then revise the language to make it more palatable. In the example above, replace “directly competes with the sales of the Work” with “reasonably likely to injure the sales of the Work.” (This adds the legal standard of reasonableness.)
2) Second, limit the clause to a specific time frame – e..g, 1-3 years after publication of the original work. This will give the publisher enough time to exploit the commercial value of your novel, while still allowing you to publish your prequel or sequel with another publisher. Obviously this also requires that you also delete any option clause in the first publishing agreement, or limit it appropriately (see http://publishlawyer.com/quick-guide/#Q_Tell_me_about_option_clauses).
3) Ask that the non-compete clause affirmatively exempt all derivative works.
In all events, you should add “If Author has a website, Author may use up to one chapter, or the prologue and one chapter, of the final, approved version of the Work as a promotional teaser on website. Author’s website must include a link to Publisher’s website.”
It bears repeating that even if you delete or significantly modify the non-compete clause as indicated above, copyright law still applies. Many writers grant all rights to their publishers for the term of the agreement, including all derivative rights. Section 101 of the Copyright Act defines a derivative work as one which is “based upon” some preexisting work(s). Unless you specifically reserve your rights to publish a sequel or prequel, or to use your characters in another work while the original work still is in print, you and your new publisher could be sued for copyright infringement by your first publisher. Yes, even, though it is your original work!