2nd Circ. Rekindles Romance Novel Royalty Suit

Law360, New York (May 1, 2014, 7:26 PM EDT) -- The Second Circuit on Thursday partially revived a class action claiming that Harlequin Enterprises Ltd. cheated some of its authors out of e-book royalties, ruling the writers had plausibly alleged that the romance novel publisher may have based its royalty rates on an artificially low licensing rate.

Although the appeals court declined to revive all of the suit’s contract claims, the three-judge panel found the writers had sufficiently shown that Harlequin may have broken its author contracts by basing their e-book royalties on an allegedly paltry licensing agreement with the company’s Swiss subsidiary.

“These allegations ... nudged plaintiffs’ claims across the...

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