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Comic Exports, Inc. and Comic Holdings, Inc. Intent to Sell Diamond Comic Distributors UK Gets an Official Announcement

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Diamond Comic Distributors

Last week, we were first to break the news that Comic Exports, Inc. and Comic Holdings, Inc. had filed a motion with the court to sell their shares of Diamond UK to a new company. The new company, Diamond Distributors UK Ltd., is a new company owned and managed by the existing United Kingdom-based management team of Diamond UK.

The sale is part of Diamond’s chapter 11 bankruptcy proceedings. In January 2025, Diamond Comic Distributors filed for Chapter 11 bankruptcy. Since then, it has been selling its assets to raise funds to repay its creditors. Diamond UK was one of the last major assets that was up in the air as to its fate. You can get all of the news concerning that here.

You can read the full official press release below.

Comic Exporters, Inc. and Comic Holdings, Inc., subsidiaries of Diamond Comic Distributors Inc., today announced that they have entered into an agreement to sell 100% of the shares of Diamond Comic Distributors UK (“Diamond UK”) to Diamond Distributors UK Ltd., a new company owned and managed by the existing United Kingdom-based management team of Diamond UK.  Comic Exporters, Inc. and Comic Holdings, Inc. are part of the chapter 11 bankruptcy proceedings of Diamond Comic Distributors, Inc., and therefore, the parties’ agreement is subject to United States Bankruptcy Court approval.

“We are extremely pleased that we have entered into this agreement and look forward to Court approval of the sale of the shares in Diamond UK,” said Diamond Chief Restructuring Officer Robert Gorin. “We are confident that Diamond UK’s publishers, retailers and other business partners will be in good hands with Diamond Distributors UK Ltd.”

“The management team of Diamond UK is extremely proud of the hard work that the entire UK team has put in during the Chapter 11 process and thankful for the support shown to us by all the publishers/partners and our accounts-retailers, whom we represent and supply in the United Kingdom, EMEA region and Australia,” said Mike Holman, Chief Executive Officer of Diamond UK. “We can think of no better way to thank them than by working toward a reliable and profitable future together.”  

About Diamond UK

Diamond UK is a standalone business that serves the United Kingdom, European, Middle Eastern, and Australian comic book, collectible, and book markets, and is the dominant distributor for major publishers.

Diamond Submits Another Motion to Extend the Time to File its Chapter 11 Plan Pushing out Resolution to the New Year

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Diamond Comic Distributors

In January 2025, Diamond Comic Distributors filed for Chapter 11 bankruptcy. Since then, it’s been a wild ride of twists and turns involving the sale of its assets and more. The one thing we’re all waiting for is to see Diamond’s actual plan concerning the Chapter 11. Who will get paid back what is a burning and very important question. We might have to wait a bit longer for that answer as Diamond has filed another motion to extend the time it has to submit its plan.

In the new motion, Diamond has asked to file its chapter 11 plan by October 29, 2025 with 90 days to then solicit the votes for it, which would but that out to December 29, 2025. Currently, the plan needs to be filed by July 31 with the solicitation period for votes expiring on September 29.

The reasons given by Diamond, aka “cause,” are:

  1. It’s a complex case involving four jointly-administered Debtors with over 1,000 creditors and $80 million in debt;
  2. Diamond has made “good faith progress”;
  3. There’s still the consignment sale issue to deal with;
  4. Diamond is paying bills as they come in;
  5. There’s a plan coming and they need more time to monetize their assets;
  6. It’s only been seven months…;
  7. Diamond doesn’t believe this will “pressure creditors.”

Read the new motion below:

Sparkle Pop Amends its Complaint Against Alliance Entertainment

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Ad Populum vs. Alliance Entertainment

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 asked 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. During San Diego Comic-Con, that initial complaint was amended with a bunch of changes.

The changes, which you can see below, seems to tighten up the language a bit as well as add some more specifics as to what Alliance is accused of and how it negatively impacts Diamond. That is likely in response to Alliance who said the initial complaint was very general without specifics and examples of what it was being accused of.

Now, Sparkle Pop has expanded its accusation surrounding the theft of trade secrets, laying out exactly what that is including “customer information,” “vendor information,” “employee information,” and “marketing information.” It goes into detail that Diamond has built up a knowledge of the product mixes that customers would be interested in and that a competitor would not know that detail, even if they knew the identity of vendors/customers. Weirdly, it mentions employee compensation as something that was a “trade secret,” when it could easily have been ascertained by just asking individuals. Conversations about salaries and salary ranges seem normal, even among competition.

It now straight up accuses Alliance of never really being interested in Diamond and instead it was all a ruse to expand Alliance’s “reach and its product portfolio.”

There’s a lot of weird statement of details too like getting a list of Diamond employees, something that can be gained from LinkedIn with little effort.

There seems to be an effort with this amended complaint to strengthen Sparkle Pop’s case, it now says that in the acquisition of Diamond by Sparkle Pop, the APA says that Sparkle Pop can now defend Diamond’s “intellectual property” and “trade secrets,” something Alliance has said Sparkle Pop had no standing to do.

What does seem new are details regarding Alliance’s hiring of former Diamond Staff. Mike Schimmel, former head of sales at Diamond, is particularly singled out. The timeline states that Schimmel resigned and only after did Sparkle Pop/Diamond send out an email firing staff. Afterwards, Schimmel obtained that email and Schimmel was not dismissed or fired by Sparkle Pop/Diamond. Further, it says the six other employees hired by Alliance were part of a list that Schimmel provided Alliance.

There does seem to be one error we found. In point 61:

“In particular, several reported that Diamond Comic had made concerted efforts to recruit and solicit Diamond Comic employees at the Los Angeles Toy Fair, held between April 28 and May 2, 2025.”

We think they mean “Alliance had made concerted efforts…”

It would really seem that the possible loss of Amazon as a client is what Diamond/Sparkle Pop is scared of. It’s called out in point 68 and 69 and has been mentioned before.

You can keep up with the full history, including a timeline, of Sparkle Pop vs. Alliance here. You can read the new amended complaint below as well as the “red line” version which shows everything that has been changed from the initial complaint.

Overall, the new amended complaint feels like it’s a bit more focused, a stronger argument, with more details.

Diamond Select Toys, Comic Exporters and Comic Holdings’ New Operating Reports Submitted as part of Diamond’s Chapter 11 Process

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Diamond Comic Distributors

After a significant delay as well as threats to change their status, Diamond has been submitting “Monthly Operating Reports.” June’s report for Comic Holdings and Comic Exporters have been filed and we got May and June for Diamond Select Toys and nothing Diamond Comic Distributors.

The below includes filings for Diamond Comic Distributors, Diamond Select Toys, and Comic Holdings, and Comic Exporters.

In January, Diamond Comic Distributors, Diamond Select Toys, and more filed a petition for Chapter 11. But, Diamond hadn’t filed a Monthly Operating Report since commencing the case. The reports for January, February, and March were overdue leading to a motion to switch their status from chapter 11 to chapter 7 or dismiss the case. That motion has been dismissed.

Below is the latest update with a tracking of information for each report.

Here’s the info released for Diamond Comic Distributors:

January 2025February 2025March 2025April 2025May 2025
Current Employees:473 (though 478 at one point)462456456
Disbursements:$13,683,765$31,600,829$25,132,240$22,744,341
Ending Equity/Net Worth:$5,695,551$2,422,745$269,300-$5,224,936
Profit:$2,018,090-$10,110,858-$1,700,394-$715,328

Diamond Select‘s information:

January 2025February 2025March 2025April 2025May 2025June 2025
Current Employees:2118171700
Disbursements:$304,181$280,707$210,703$147,011$160,498$17,621
Ending Equity/Net Worth:-$31,352,292-$44,508,649-$45,510,494-$45,904,870-$12,827,322-$14,347,060
Profit:$152,465$151,188$175,356$144,079$13,433$0

Comic Holdings‘ information:

January 2025February 2025March 2025April 2025May 2025June 2025
Current Employees:000000
Disbursements:$0$0$0$0$0$0
Ending Equity/Net Worth:-$27,916,472-$40,848,045-$41,271,204-$41,624,489-$4,392,505-$5,905,302
Profit:$0$0$0$0$0$0

Comic Exporters‘ info:

January 2025February 2025March 2025April 2025May 2025June 2025
Current Employees:000000
Disbursements:$0$0$0$0$0$0
Ending Equity/Net Worth:-$27,916,472-$40,848,045-$41,271,204-$41,624,489-$4,392,505-$5,905,301
Profit:$0$0$0$0$0$0

We’ll have further updates as subsequent months are released.

The Official Committee of Unsecured Creditors has filed a Statement and “Reservation of Rights” concerning Diamond’s Consignment Motion

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Diamond Comic Distributors

The Official Committee of Unsecured Creditors has filed a statement and “reservation of rights” concerning Diamond‘s motion to sell the remaining consignment stock it has.

In the filing, the committee notes there has been a lot of responses to this particular motion, 12 objections so far and more have contacted the committee.

The committee believes that the motion will cause another round of litigation, increasing costs, and dragging things out. It mentions the two other lawsuits related to Diamond’s Chapter 11 filing and reveals it believes there are $30 million claims by Diamond and Ad Populum against Alliance Entertainment.

The committee thinks facts need to be laid out, and quickly regarding the consignment question with a conference on the motion set for August 5.

Interestingly, there’s mention of “settlement discussions” that will:

  1. the projected value of the consigned inventory to be sold in the Consignment Sales and an accounting of same;
  2. the projected value of the consigned inventory to be sold in the Consignment Sales, and the claims asserted by consignors, specifically attributable to goods delivered after the Petition Date;
  3. whether consignors received consigned inventory, delivered prior to the Petition Date, back from the Debtors after the Petition Date;
  4. whether consignors were paid after the Petition Date for consigned goods that were delivered to the Debtors prior to the Petition Date;
  5. the amounts of each consignor’s claims against the Debtors’ estates arising prior to or after the Petition Date, and whether those amounts match what is in the Debtors’ books and records; and
  6. the costs and expenses incurred by the Debtors in connection with storing consigned inventory since the Petition Date, as well as storage charges paid and owing by consignors since the Petition Date.

The Committee believes these data points and others could be significant and should be factored into any settlement proposal.

It interestingly acknowledges if Diamond can sell the stock, it’d get a potential significant amount of money. But, it may also open them up to “administrative expense claims,” and more legal fights and maneuvering all of which will cost more money.

In short, they think lawyers are about to make a lot more money from Diamond, the debtors, and this potentially is getting dragged out, so they want the court to consider all of that when making a decision.

Read the full motion below:

The Ad Hoc Committee Files a Motion to Stay Diamond’s Motion To Sell its Consignment Inventory

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Diamond Comic Distributors

Publishers have been filing objections to Diamond Comic Distributor‘s motion that would allow them to sell, liquidate, dispose of, inventory it currently still has. Many publishers have already been vocal about the motion and many have responded to our inquiries with “no comment” because it’s an ongoing legal matter. TwoMorrows Publishing, Magma Comix, and Graphitti Designs, Abstract Studio, NBM, William M. Gaines, Agent, Inc., Humanoids, a joint filing by 13 publishers, GAMA, the Ad Hoc Committee of Consignors, Cryptozoic Entertainment, and Image Comics have each filed objections to the motion. Diamond’s bank lender JPMorgan Chase filed a “limited objection” and “reservation of rights.” That’s about 1/3 of the 128 publishers mentioned as impacted in Diamond’s initial motion.

In many of those objections, it has been pointed out that who actually “owns” the consignment stock hasn’t been determined by the court. The Ad Hoc Committee, a group of creditors that has formed to represent the interests of those who provided goods to the debtor, has filed a motion to stay the decision as to what to do with the stock.

The Ad Hoc Committee, due to many of the reasons brought up in the objections has asked the court to:

  1. the Debtors have obtained a declaratory judgment from this Court confirming that the proposed Stock to be sold is, in fact, property of the Debtors’ estates; which declaratory judgment can only be achieved through
    • (i) the Debtors’ commencement and service of a complaint on each of the respective consignors who delivered the Stock proposed to be sold;
    • (ii) opportunity for discovery by all parties to the declaratory judgment action; and
    • (iii) dispositive motions and/or trial on the causes of action identified in the Debtors’ prospective complaint; along with any subsequent appeals or expiration of deadline to appeal any such final order; and
  2. the Debtors have amended the Motion to clarify which Stock is proposed to be sold.

The issue has been delayed with objections extended partially due to so many objections as well as San Diego Comic-Con. We expect a lot of movement on the topic next week.

Diamond Motions to Sell its Shares of Diamond UK

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Diamond Comic Distributors

During the Chapter 11 proceeding of Diamond, a big question has been out there, the fate of Diamond UK. Today, Diamond submitted a motion to sell the shares of Diamond UK that Comic Exporters and Comic Holdings hold. Diamond UK was not part of the assets purchased by Universal Distribution and Sparkle Pop in the initial sale of assets during the proceeding. Diamond has been working to sell the rest of its assets.

Diamond UK is being sold for $2.1 million, with the motion calling it a “heavily-negotiated purchase price” with a $200,000 deposit made in good faith.

Revealed in the motion is that the purchaser is an entity formed by members of the UK-based management team of Diamond UK. None of Diamond’s officers or directors are part of the ownership group of the newly formed entity.

As part of the deal, JPMorgan Chase Bank would have to release Diamond UK from its obligations as a guarantor. The sale would be “free and clear of all encumbrances.”

As with everything in a bankruptcy, the sale must be approved. You can check out the motion, “sale order,” and “purchase agreement,” below. We’ll be going through all the docs more thoroughly, San Diego Comic-Con beckons right now.

Multiple Objections Deemed Deficient in Objection to Diamond’s Motion to Sell Consignment Merchandise

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Diamond Comic Distributors

Publishers have been filing objections to Diamond Comic Distributor‘s motion that would allow them to sell, liquidate, dispose of, inventory it currently still has. Many publishers have already been vocal about the motion and many have responded to our inquiries with “no comment” because it’s an ongoing legal matter. TwoMorrows Publishing, Magma Comix, and Graphitti Designs, Abstract Studio, NBM, William M. Gaines, Agent, Inc., Humanoids, a joint filing by 13 publishers, GAMA, the Ad Hoc Committee of Consignors, Cryptozoic Entertainment, and Image Comics have each filed objections to the motion. Diamond’s bank lender JPMorgan Chase filed a “limited objection” and “reservation of rights.” That’s about 1/3 of the 128 publishers mentioned as impacted in Diamond’s initial motion.

But… a bunch of the filings are deficient according to the court. In other words, they don’t follow the rules for filing.

Objections filed by William M. Gaines, Agent Inc., NBM Publishing Inc., Abstract Studio, Inc., Graphitti Designs, Molten Core Media, LLC aka Magma Comix, and TwoMorrows Publishing have all been deemed “deficient” by the Clerk of the Court. The reason given:

Appearance of counsel is required. (Local Bankruptcy Rule 90101)

Local Bankruptcy Rule 9010-1 in Maryland requires a corporation to be represented by an attorney in bankruptcy proceedings. Petitions and pleadings have to be signed by an attorney. There are some exceptions as to what corporations can do and how they can participate, but in this case, they need a lawyer to file the objection.

To fix they issue, they need to get an attorney who’s barred by the District Court.

Liminal Esports LLC had their filing deemed deficient by the court and it is now stricken from the official record as they didn’t correct it in time.

Image Objects to Diamond’s Motion to Sell Consignment Stock

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Image Comics logo

Publishers have been filing objections to Diamond Comic Distributor‘s motion that would allow them to sell, liquidate, dispose of, inventory it currently still has. Many publishers have already been vocal about the motion and many have responded to our inquiries with “no comment” because it’s an ongoing legal matter. So far, TwoMorrows Publishing, Magma Comix, and Graphitti Designs, Abstract Studio, NBM, William M. Gaines, Agent, Inc., Humanoids, a joint filing by 13 publishers, GAMA, the Ad Hoc Committee of Consignors, and Cryptozoic Entertainment have each filed objections to the motion. Diamond’s bank lender JPMorgan Chase filed a “limited objection” and “reservation of rights.” Image Comics has now filed a motion objecting to the motion. That’s about 1/3 of the 128 publishers mentioned as impacted in Diamond’s initial motion.

In Image’s objection, they come out swinging calling it a “brazen attempt by the Debtors to misappropriate Image’s inventory.” They state they’ve been in discussion with Diamond for months for the return of the inventory as well as provide contractually required reporting but were told they’d need to wait to see if Diamond’s new owner Sparkle Pop took on everything. From Image’s filing, it would seem that Sparkle Pop didn’t do that.

Image contends that it wasn’t a consignment agreement with Diamond. Instead, Diamond was an “exclusive agent” tasked with “selling, billing,
warehousing, shipping, collecting, returns handling, and other customary customer services for distribution of Image’s Products.” And, while Diamond held the inventory, it was really Image’s property and then ownership of that merchandise transfers to whomever purchases it. At no point does Diamond own the product.

Image contends this is a blow to Diamond’s statement in their original motion that publishers needed to file a UCC-1 financing statement to preserve their ownership of the merchandise. Instead, since Diamond was just an “agent,” there was no need for that filing.

Image also pokes whole in Diamond’s claim most of their inventory was purchased outright across all of the debtors. Debtors include Diamond Comic Distributors, Diamond Select Toys, and more. Image says that statement is a bit false and that Image didn’t do business with the rest, just Diamond Comic Distributors and that percentage of consignment crosses a threshold sent to make Diamond’s proposal ok according to previous court rulings and bankruptcy law.

Image has threatened discovery between Diamond and its creditors, JPMorgan Chase, to show that JPMorgan Chase Bank knew that Diamond was largely consignment and did not own the inventory it’s intending to sell to pay back JPMorgan.

In the filing we get details on Image’s switch to Lunar Distribution.

  • In 2023 Image switched exclusively to Lunar
  • In April 2024 Diamond became Image’s exclusive agent in the overseas market
  • Image asked Diamond to transfer inventory to Lunar
  • Diamond failed to transfer a large portion of that inventory without explanation
  • Of the total $2,909,486.23 worth of Image inventory left at Diamond today, $1,231,783.92 (~42%) is inventory that Diamond failed to transfer to Lunar’s possession per Image’s direction.
  • Diamond failed to do what was asked

Image also raises the question as to who owns the property Diamond is trying to sell. Since that hasn’t been established, it can’t go forward. It says it’ll be injured through the sale and receive nothing for it.

You can read Image’s full objection below as well as Eric Stephenson’s declaration of support for Image’s objection.

Diamond’s lender JPMorgan Chase has a Limited Objection and Reserves Rights Concerning Diamond’s Consignment Plan

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JPMorgan Chase

Publishers have been filing objections to Diamond Comic Distributor‘s motion that would allow them to sell, liquidate, dispose of, inventory it currently still has. Many publishers have already been vocal about the motion and many have responded to our inquiries with “no comment” because it’s an ongoing legal matter. So far, TwoMorrows Publishing, Magma Comix, and Graphitti Designs, Abstract Studio, NBM, William M. Gaines, Agent, Inc., Humanoids, a joint filing by 13 publishers, GAMA, the Ad Hoc Committee of Consignors, and Cryptozoic Entertainment have each filed objections to the motion. Now, Diamond’s bank lender JPMorgan Chase is getting in on the action with a “limited objection” and “reservation of rights.”

JPMorgan Chase Bank is Diamond Comic Distributor’s lender, having loaned out money to keep them operating through the chapter 11 process. The maturity of that is August 23, 2025 currently.

JPMorgan Chase in their motion through “reservation of rights,” stand that they need to be paid first. So, any money from the consignment sale should go towards JPMorgan Chase to pay off the loans and then publishers or anyone would come second. They also want to be able to object to “any Consignment Sale that is legally or factually insufficient or impermissible, proposed in derogation of Lender’s consultation rights, not proposed in good faith, or violative of the terms of the Final DIP Order or applicable law.” In short, they want to get paid, and need to get it all paid, and if they’re not first, they’re going to object to it. If the court or anyone attempts to mess with that… objection!

In short, JPMorgan Chase has planted a flag for the future when it comes to decision concerning Diamond’s consignment motion.

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