In mid-September, Sparkle Pop filed a lawsuit against Dynamic Forces, aka Dynamite Entertainment, for what it claims as breach of contract. Sparkle Pop is the new entity that has taken over Diamond Comic Distributors in its chapter 11 process. Sparkle Pop claims Dynamic has “made millions of dollars from its long-standing commercial relationship” but “failed to reimburse Plaintiff for certain costs incurred.” The lawsuit is an attempt to recover those costs. The lawsuit claims that Dynamic was to reimburse Diamond for “storage fees, freight costs, certain marketing-related expenses, and other costs.” Sparkle Pop is looking for damages including interest and costs, disbursements, and attorney’s fees. Dynamic and Dynamite are suing Sparkle Pop/”new” Diamond and claiming they are owed over $500,000 themselves.

Now, Dynamic has responded to Sparkle Pop’s claims and…. filed a counterclaim seeking damages from Sparkle Pop!

Dynamic’s response gets right into things, admitting to simple statement of facts while denying much of the rest. This is a pretty standard response but there are some highlights:

Under Parties: “Denied in part, Sparkle Pop is not the holder of all right title and interest to the assets and receivables owing to Diamond Comic Distributors (“DCD”) pursuant to an Order of the United States Bankruptcy Court for the District of Maryland”

Under Factual Allegations: “denied that any contract, receivable, and/or consignment related to Dynamic was purchased through the DCD Bankruptcy sale.”

Those two are setting it up that Sparkle doesn’t have the rights to the claim/contract it’s suing under. In short, old Diamond should be the one suing if anyone, and that was settled it would seem.

Now, to the counts.

Breach of Contract

…denied that Dynamic agreed to pay for certain fees and expenses incurred by DCD at all times relevant to the claims asserted in this matter.

And with all of that denial, Dynamic has requested the judge to rule against Sparkle Pop. It then lists a whole lot of reasons that Sparkle Pop doesn’t have an argument and failed to make its case.

But, where it gets interesting is that Dynamic has included a counterclaim in their response.

In it, Dynamic focuses on the consigned goods, a heated point of contention. When Sparkle Pop purchased Diamond’s assets, it didn’t purchase the consigned goods. But, Sparkle Pop wound up selling those goods and pocketed the money. They’ve been called out and the money is currently is sitting in a bank account controlled by the court until a decision is made as to who “owns” the consigned goods that remain and the ones that have been sold. None of that can be argued.

Because of that, Dynamic is going after Sparkle Pop for the sale of the goods in the amount of $644,403.35 plus attorneys fees and more.

This one should be interesting since it’s now a fact in the court and Sparkle Pop has admitted to doing exactly what Dynamic has claimed.

Dynamic is seeking damages, interest, costs and disbursements. The challenge will be the current ongoing debate in court about the consigned goods and who has a right to them, which is still in the process of being determined.