Derivative rights are. quite simply, the rights to your story once it is adapted into another form. The most classic example of this is when a books/story is “adapted” into a screenplay and then a movie. Most of the movies in theaters today were adapted from a screenplay which was adapted from an author’ s book at one point. If the author was not careful when he/she originally entered into an agreement with book’s publisher, the derivative rights may be lost or limited. For that reason, it is critical that authors always ensure that their agreement with a publisher leaves full derivative rights solely with the author. Below is a typical clause that properly leaves all derivative rights with the author. It is pulled, with permission, from a standard Page Publishing agreement:
Royalties Derived from Derivative Works: Any derivative works of Author’s original Work (screenplays, motion picture/TV scripts, etc.) shall be the sole and exclusive property of Author. Any royalties or monetary compensation resulting therefrom during the term of this Agreement shall be the sole property of Author with Publisher having no claim thereto.
Thus, it is very important that any publishing agreement you enter into have such a clause which specifically leaves all derivative rights with you, the author.