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US jury finds Australian publisher of ‘Fifty Shades’ defrauded partner out of royalties

A Texas jury has ruled that American Jennifer Lynn Pedroza was defrauded by Australian Amanda Hayward over royalty rights to the ‘Fifty Shades of Grey’ series, reports Reuters.  

Pedroza was one of four original partners in The Writer’s Coffee Shop (TWCS), the independent publisher that first published the series as ebooks. TWCS later sold the publishing rights to Random House.

The jury found that Hayward and TWCS Operations Proprietary had committed fraud when they ‘induced Ms. Pedroza into a Service Agreement’ that cut Pedroza out of her share of royalties. Hayward was found to have fraudulently restructured the partnership in her favour under the guise of tax avoidance.

Damages will be assessed at a later court hearing after an audit determines Pedroza’s share of royalties. To date, ‘Fifty Shades of Grey’ titles have sold more than 100 million copies.

As previously reported by Books+Publishing, Pedroza and TWCS employee Christa Beebe filed a suit in May 2014 claiming Hayward established a business entity to negotiate with Random House that was solely owned by her. The suit stated: ‘Hayward told her partners that the partnership prospectively needed to be restructured into an entity solely owned by her for “tax reasons”. She then fraudulently induced Pedroza and Beebe into signing “service agreements” with TWCS, and subsequently terminated both of them.’ In the suit, Pedroza sought 25% of the profits.


Category: Local news