Arlington woman entitled to about $10.7 million in 'Fifty Shades' royalties

Forensic accountants basically agree that an Arlington woman’s stake in a partnership that produced Fifty Shades of Grey is worth $10.7 million.
Forensic accountants basically agree that an Arlington woman’s stake in a partnership that produced Fifty Shades of Grey is worth $10.7 million. AP

An Arlington woman’s interest in the e-publishing business that originally released the steamy international blockbuster Fifty Shades of Grey is worth about $10.7 million.

Earlier this year, a Tarrant County jury agreed that Jennifer Pedroza of Arlington was cheated out of millions of dollars in royalties by Amanda Hayward of Australia, her partner in an online company that released what would later become a New York Times bestseller.

The jury did not set a dollar amount, but attorneys representing Pedroza and Hayward said during a court hearing Wednesday that forensic accountants determined that Pedroza’s 25 percent interest in the $41 million earned by the book was worth roughly $10.7 million.

State District Judge Susan McCoy did not award that amount to Pedroza in a final judgment Wednesday. Instead, she granted the attorneys more time to negotiate a specific final total that would also include attorneys fees and interest.

“It’s in the ballpark of what we’ve been seeing,” said her Dallas attorney, Michael Farris. Pedroza is now a Fort Worth school teacher.

McCoy reaffirmed a decision from earlier this month that she wants at least $10 million put into a court-controlled account — either in cash or assets — to pay off the judgment. Hayward’s attorneys wanted that ruling set aside, stating their client doesn’t have the $10 million in cash.

“I’ve still not signed the order. I’ve not crystallized what the money should be comprised of,” McCoy said. She said she was concerned about “the lack of available funds” and that the biggest asset listed in sealed court records was Hayward’s home in Dural, a suburb of Sydney.

McCoy said she wants the cash and assets deposited in the court registry by Sept. 25. Attorneys are expected to give McCoy a recommended final judgment amount within the next few weeks.

Pedroza and Hayward were partners in The Writer’s Coffee Shop, which started out as an online blog in 2009, along with Waxahachie resident Jennifer McGuire. Visitors went to the fan-based website and wrote “fan fiction” stories.

McGuire did design work for the blog. Pedroza uploaded contributors’ writing, and Hayward worked with the authors. Later, Christina Beebe, another Arlington resident, joined and helped with marketing and distribution.

By 2010, the Coffee House was acting as a publisher and a year later it published Fifty Shades of Grey, a romance novel by E.L. James, a British author, as an e-book and print-on-demand book. It also published the two sequels, all of which were eventually bought by Random House.

But Pedroza sued Hayward, saying she conned her out of her rightful partnership interests and royalties flowing from the wildly successful book, which inspired a movie by the same name.

Earlier this year, a Tarrant County jury agreed, and the parties have been squabbling over the net value of what that partnership was worth. Eventually accountants hired by Pedroza and Hayward came up with similar amounts, $10,690,648 and $10,724,667, respectively.

Regardless, David Keltner, one of Hayward’s attorneys, said his client did not have $10 million in cash to put into the court registry. Farris has repeatedly expressed concerns that so much of the original $41 million appears to have been spent “for her own personal benefit.”

Farris said there “have been settlement discussions,” but would not elaborate. Keltner said that they have “fundamental differences on what the law is” and, barring any settlement, would look at those issues on appeal.

Max B. Baker: 817-390-7714, @MaxbakerBB

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