Defendant Alliance Entertainment has filed a motion with the court to dismiss the complaint, with prejudice, against it by Sparkle Pop. You can check out our dashboard with all of the major events including a timeline.

In January 2025, Diamond Comic Distributors filed for Chapter 11 bankruptcy. In the months since, the drama that has come out due to the proceedings has been worthy of an HBO miniseries with bids made, bids rejected, last minute switches, and now accusations of NDAs broken and corporate espionage.

On June 9, 2025, Sparkle Pop, one of the winners of Diamond’s assets, filed a complaint against Alliance Entertainment and asking for a temporary restraining order. Alliance Entertainment was the original winning bidder for Diamond’s assets during the bankruptcy but pulled its bid accusing Diamond and its representatives of fraud. That legal case was ongoing as of this initial launch.

Sparkle Pop has accused Alliance of breaking its NDAs, poaching Diamond employees, and stealing corporate secrets it learned during its bid for Diamond.

Alliance lists four major reasons the lawsuit should be dismissed, with a whole bunch of bullet points for each reason:

1. Alliance believes Sparkle Pop lacks standing to enforce the contract. In short, Alliance says it entered the NDA with Raymond James and Diamond Comic Distributors, not Sparkle Pop. Sparkle Pop also is not an “intended third-party beneficiary” of the NDA. Since they’re not a part of beneficiary, Alliance Entertainment states under Maryland Law, Sparkle Pop doesn’t have standing.
2. When it comes to the theft of trade secrets, Alliance states that Sparkle Pop:
   • A) Has failed to allege it’s the owner of a trade secret;
   • B) What the trade secret even is;
   • C) Sparkle Pop hasn’t shown any protection of the trade secrets beyond stating it operated “according to established information security policies;”
   • D) The trade secrets aren’t really a secret and have been “disseminated to the public.” Customer and vendor lists are out there and Diamond itself released it during the Chapter 11 process;
   • E) Again, it’s stated Sparkle Pop has identified any actual trade secrets;
   • F) Sparkle Pop hasn’t show Alliance acquired any trade secrets by improper means.
3. There’s no claim stated under the Maryland Uniform Trade Secrets Act. Since Sparkle Pop didn’t show it possessed a trade secret, Alliance acquired one, and Alliance knew it was acquired by improper means, then it should be dismissed.
4. No “Tortious Interference” is shown.
   • A) There was no employment contract with the former Diamond employees Alliance hired and employees decided to leave due to Diamond’s Chapter 11 filing and an uncertain future;
   • B) Sparkle Pop claims Alliance got Diamond’s transition services agreement, but never showed it was an unsealed version and Alliance had any idea what was in it;
   • C) Employees left not because Alliance “poached” them but their exit interviews show they were “disenchanted” with Sparkle Pop and were searching for new jobs for months.

You can read the full motion below.