You also must remember that "royalties" is not a standard feature of each publishing deal. It is generally in the contract of the researcher--or not. When I do a book with a flat fee contract, generally that writing is the property of the person I contracted with, and he or she (or usually "it," since it's a company) can sell, give or rent it to Hyperion if they wish.

If Hyperion really used his edition, for which he was entitled to royalties, then they have to pay.

I'm also not sure what you mean by "all he has done is publish it." He did no actual editing?

As SRS says, it should not make future releases of this kind unviable.