My publishers have kill fees, but I didn't walk away. I might get reamed out for this comment, but I believe they're necessary.
Let's say a publisher has a book edited and a cover designed. Then at the last second, the author pulls out and no longer wants their book published (for whatever reason.) That publisher is out edits and a cover they still have to pay for. And let's say the author takes their freshly edited book and self-pubs it. Of course, they can't use the pretty cover already made for them, but what's to stop them from using the edits?
I have no problems with a publisher establishing kill fees to protect them against authors who do this. But what bothers me is when I hear about unrealistic and sky-high charges being billed to them by the publisher.
To me, if an author is going to be charged a kill fee, then it needs to be equal to what the publisher is out. That way the author still has to pay to get out of his/her contract, but the editor is paid, the cover artist is paid, and the publisher is not out any expenses.
