Sparkle Pop’s Motion for Relief is Denied Without Prejudice
While it feels like the comic industry has moved on from Diamond’s chapter 7 process, the court cases are very much still active with numerous major decisions still to be made. In April, Sparkle Pop filed a motion “for relief from the automatic stay to exercise its rights under applicable state law with respect to the goods remaining in a distribution facility owned and operated by Sparkle Pop.” One of the ongoing fights in Diamond‘s bankruptcy concerns consigned goods provided by publishers and still “held” by Diamond. Publishers of course want their inventory back while Diamond claims it has a right to it so it can sell the product and pay back creditors. The inventory is currently being stored in a facility run by Sparkle Pop, one of the winners of the bidding for Diamond’s assets during the bankruptcy.
In the filing, Sparkle Pop stated there are “8,250,936 units of these goods being stored at the Mississippi Facility.”
Sparkle Pop also stated it is owed $641,430 as of April 2026 and has not received its rent payments from (old) Diamond since November 2025. Rent is $125,000 a month. Sparkle Pop previously filed an administrative claim for $580,000 in March.
In short, Sparkle Pop was arguing it is suffering damages from (old) Diamond’s consigned goods being stored in their facility.
Sparkle Pop was looking to be reimbursed for all of its fees and costs related to the consigned goods and it threatened to exercise its “rights and remedies under Mississippi law to, among other things, assert a warehouseman’s lien on the consigned goods and/or take the necessary steps, under applicable law (or with the consent of the parties), to arrange for these goods to be removed from the Mississippi Facility.”
Today, the court has come down with its decision:
Evidentiary Hearing Held: re: 1265 Relief from Stay and Notice of Motion IS DENIED WITHOUT PREJUDICE TO REFILING AFTER 60 DAYS. Order to be prepared by Movant.(related document(s) 1265 Relief from Stay and Notice of Motion, 1277 Objection, 1280 Objection) (Scott, Cherita)
Since it was “denied without prejudice,” Sparkle Pop can refile its motion again with adjustments. It’s possible there was an error in the original filing or new information that has dropped that impacts the original.
We’ll have more information as this court case continues and update this one if more details emerge as to the reason the motion was denied.
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Thank you for continuing to follow up on this. I’m not sure if anybody else is still interested, but I am.
I’m following this to the end. I don’t think anyone really cares anymore, the industry doesn’t based on the lack of nominations for anyone covering it in the Eisner journalism category. The industry doesn’t support journalism, they want fluff.
There’s a different case that’ll impact comics I need to catch up on and will have an article tomorrow I hope.
Yeah, I worked doing some journalism stuff (still do, sorta) but after dabbling a little bit in doing some investigative journalism I backed out. It takes a lot of time and sometimes your own money to do. Everybody within the industry says they want it, until they are part of the story. Then they clam up and don’t want to talk. Meanwhile the story the vast majority of fans only really care about is who’s drawing the next issue of Batman. This is why I almost never criticize people doing comics journalism even if they are not doing it very well.
Nailed it. There’s one story I’ve got that’ll potentially be big, just figuring out the framing of it and need to get some small details.