WASHINGTON (CN) - Five authors claim they were defrauded by Eagle Publishing, corporate parent of Regnery Publishing, an outlet for right-wing writers. The authors claim Regnery and Eagle cheated them of more than $1 million in royalties by a self-dealing scheme in which Eagle diverts books away from retail outlets to wholly owned subsidiaries, which sell them at steep discounts.
Plaintiffs Jerome Corsi, William D. Gertz, Robert B. Patterson, Joel Mowbray, Richard Miniter demand an accounting and punitive damages for fraud, interference, unfair trade, unjust enrichment and damage to their reputations.
They claim "Eagle orchestrates and participates in a fraudulent, deceptively concealed and self-dealing scheme to divert book sales away from retail outlets and to wholly owned subsidiary organizations within the Eagle conglomerate. Under this scheme, books written by authors and published by Regnery are sold or transferred to affiliated organizations within the Eagle conglomerate for no charge, or for a substantially reduced charge, in order to avoid or substantially reduce royalty payments to authors. The scheme is continuing in nature. As a result of the fraudulent scheme, Eagle has benefited and been unjustly enriched will in excess of $1 million to the detriment of the authors."
Plaintiffs claim Eagle and Regnery dishonestly dump their books on wholly owned corporate creatures such as Eagle Book Clubs, and the 80,000-member Conservative Book Club, cheating the authors of virtually 100 percent of the royalties they would receive from retail sales. "The web of internecine, self-dealing transactions is purposefully designed to divert sales away from the retail book trade, and is intentionally concealed by Eagle and its agents ... (and) manipulates and defrauds the authors," the complaint states.
Plaintiffs are represented by McFadden & Shoreman. See complaint.