In February, the motion to extend time to “assume or reject executory contracts related to consigned goods” was denied by the court in regards to Diamond‘s chapter 11/chapter 7 process. This concerned the ongoing question regarding contracts between (old) Diamond and publishers handling consigned goods. Who “owns” those goods is a contentious issue with publishers wanting their product back while Diamond, and now their Trustee, want to be able to sell the consigned goods to pay back creditors.

The denial of the motion by the Trustee has caused a chain of rejections. Because the contracts were not assumed or rejected by the deadline, publishers have pounced citing law that saws the contracts default to rejected. You can read about that here and here. Because the contracts are rejected, there’s laid out steps in the contracts as to what happens to consigned goods, primarily the publishers can get them back for the cost of shipping. Sparkle Pop also filed a response as well as Boom Entertainment.

Now, JPMorgan Chase Bank has filed their thoughts as they’re the lender to (old) Diamond.

They bank has filed a limited objection, supporting a “consensual resolution that avoids unnecessary litigation” as long as that protects JPMorgan’s rights and interests including its DIP liens and protections under the Final DIP Order.

It does object to the publishers’ various motions to end the adversary proceedings between (old) Diamond and them and get a decision from the court regarding the court without those adversary proceedings continuing.

JPMorgan goes back to using early arguments that non of the publishers filed a UCC-1 financing statement that’d have protected them during (old) Diamond’ chapter 11. That ignores that the contract between Boom Entertainment and (old) Diamond ended in December 2024, before Diamond’s chapter 11 filing.

JPMorgan is requesting the court deny the various motions by the publishers concerning the consigned goods, allow the Trustee’s appeal regarding the consigned goods be resolved, and make sure JPMorgan’s interests are acknowledged in any decisions made.