I'm a goodreads refugee. I read horror, classics, literary, science fiction, YA, weird, regency romances, historical fiction, history, science, fantasy and random bits and pieces of every genre, it seems like. I don't do as much reading and reviewing as I used to, but I'm trying to get back into the swing of things.
The article tells the story of two former teachers, Jenny Pedroza and Christa Beebe. Pedorza along Amanda Hayward, Lea Dimov and Jennifer McGuire founded the Fanfic publishing house TWCS (The Writers Coffee Shop). She was also the original editor on Fifty Shades of Grey, and was the person who convinced E.L. James to publish her fan fiction turned novel Fifty Shades of Grey through TWCS.
TWCS was a small time online publisher run by a group of friends, until Random House came knocking with a "$1 million-plus" offer to buy Fifty Shades of Grey. Amanda Hayward, who handled all the documents for the company, drew up a contract for the purchase listing herself as the sole proprietor, reassuring the others that it was “for tax purposes.” However, after they sold the rights, Pedroza received an "unfairly small" portion of the money. She was later fired, by Hayward, and so was Beebe. The article goes on to talk about Pedroza and Beebe's new business, making soap.
I've actually known about the controversy for awhile. Pedroza was very vocal about it on her Twitter account. I have also talked other former employees who either didn't get payed their promised wage, or were never paid at all. And I even heard from authors who published with them and got treated horribly (being sent incompetent/inexperienced editors, having to do their own publicity and getting barely any communication from the publisher on release dates or help). They also do some shady stuff with their contracts. They don't post their rates, like many other publishers do. In fact, they have authors sign NDAs before even discussing their rates with them.
Even if you don't have an issue with published fan fiction, I would caution authors to not work with this publisher and discourage readers from buying their books.