On June 25, 2025, Diamond Comic Distributors submitted a motion for the “sale or other disposition of consigned inventory.”

After Diamond’s sale of the majority of its assets to Universal Distribution and Ad Populum/Sparkle Pop, (old) Diamond still has a “significant inventory” that was sent on a consignment basis. I think we all assumed all inventory was moved to the two new owners, but that doesn’t seem to be the case. They had an option and that specific part of the purchase was left as to be determined. Instead, it’s sitting in (old) Diamond’s warehouse in Mississippi.

(Old) Diamond is claiming the consignors (the sellers) haven’t followed the legal steps to establish a superior claim to their inventory. In short, the publishers (owners of the product) haven’t done what’s require by law to protect their ownership rights. So now, (old) Diamond has to do something with all of that inventory.

So, (old) Diamond submitted a motion to approve their plan to market, sell, or dispose of the inventory to “minimize costs and maximize recoveries” and generate the “best result for the estates.” It is assumed that money raised from the sale would go towards paying off money owed to JPMorgan Chase Bank which has provided loans to the company throughout the Chapter 11 process. So, instead of money going towards publishers, it’d likely go towards a bank.

As you can imagine, publishers are pissed and frustrated by the lack of communication.

There’s a lot of questions out there like how much stock is being held by (old) Diamond and exactly what stock?

There are 128 publishers listed in the motion and we reached out to a large portion of them to get their responses and a better idea of what’s going on.

As you can imagine, the responses back were mostly filled with anger and frustration. While the majority didn’t respond and many responded with “no comment” due to it being legal matters, we did get some details, a lot on background, but it all help to paint a bigger picture.

This is a brazen and sleazy attempt to pilfer millions of dollars worth of books, many from small, independent publishers for whom this would be a catastrophic economic hardship. We intend to fight this wanton act of piracy with all legal means at our disposal.

-Gary Groth, the founder and publisher of Fantagraphics

I’m trying to make sense of what doesn’t make sense. As an independent creator and publisher, I feel betrayed. Our only crime is to have been loyal. To have trusted the process. Including Chapter 11. But seeing that, not only we haven’t received any payment while our books have been sold, for weeks but now Diamond plans to seize our inventory (our sole possession, basically our lifeline) and selling it for its own profit to absolve its management and pay their bank back on a technicality, is morally and economically unacceptable. It’s fraud in plain sight. We’re part of a group of 128 publishers that are victim of a situation that Diamond created and that they’re trying to solve on our backs. I can’t begin to tell you how frustrating and unfair it is.

I’ve been in publishing for 27 years. On two continents. I’ve never seen this.

I named my company FairSquare Graphics. I believe in best practices. And we’ve been fighting the good fight. Being fair to creators, my peers. Fair to the fans and retailers. All that on a tight budget with all the challenges of not having any seed money or investors. Yet, we published 46 titles in the past 5 years.

I’m an immigrant and a minority. We are a family business and we work more than everybody else. We have that mentality.

I’ve been naturalized American this past April. I swore to protect the rule of law. But where is it for me now? I feel I’ve been caught in a web of deceit. And, believe me, I’m not done fighting. FairSquare Graphics will survive this situation. Wounded. Not dead.

-Fabrice Sapolsky, Publisher FairSquare Graphics

I went into 2025 anticipating a major shake up with Diamond and preparing for the worst. The level of chaos that ensued exceeded my wildest expectations. But it was the lack of communication that was the most disappointing. Even the reps I could speak to were left in the dark up until the day they were no longer employed. There hasn’t been much for us to do but watch as things disintegrated around us.

-Tyler Chin-Tanner, Founder/Publisher A Wave Blue World

Michael Calero, the CEO/Publisher of Massive Publishing gave us not just a comment but also a look into what’s owed:

Thank you for your reporting on this matter. This is one of those cases where a bad situation somehow manages to get significantly worse due to the laws protecting a company that many would say has worked against the interest of its own creditors (Publishers) through the dishonest actions of feckless leadership. Diamond should never have been allowed to enter Chapter 11 bankruptcy, and I think if creditors would have been given the opportunity to provide the court with evidence of the manipulation of inventory and payments prior to the filing, they wouldn’t have approved it. This allowed them to accumulate even more debt, that we as consignment vendors are now being put on the hook for. Massive was one of the first companies to end our exclusive partnership over the original debt and as the sale of the company went forward, we asked for clarity on what would happen with our consignment inventory. Eventually we requested a No Cost Return (NCR) for many of our products. These requests were never properly addressed and new Diamond ownership misled us of what the status of our inventory was as recently as June 3rd. 

We have over 65,000 units of product at the Diamond warehouse which has not been paid for in any way. Consignment products which at the lowest end of our pricing ($4.99) would be worth over $325,000. 

Luckily, we did move some of our trade paperback inventory to Lunar earlier this year but that only accounted for a small portion of the inventory we had trusted to Diamond. Diamond’s contract language does not provide them with the rights to sell this product without compensating us directly, but apparently that is what they are trying to use legal loopholes to supersede. 

In short, I view this as theft. Plain and simple. Diamond is breaking its contractual agreement with us, attempting to sell the product we paid to produce, with no guarantee that we will see a single cent of the proceeds and they are using U.S. Bankruptcy court as their accomplice.

Numerous publishers described a lack of communication or confusing responses from Diamond directly. Overall, there seems to be a confusion as to what (old) Diamond still has versus what (new) Diamond has when it comes to stock and who is responsible for what. Some responses seemed to conflate this motion with Ad Populum’s lack of payments to publishers. Even those at Diamond that remain seem confused as to what’s going on.

One publisher recounted their representative told them to keep sending inventory and keep soliciting product even though the publisher stopped doing both in January. They did ask to send product in May for orders made by retailers and they expect they probably won’t be paid for that. Some publishers have asked for stock to be returned and been successful while others get no response.

Overall, the impact to publishers seems to vary. While some have said it wouldn’t impact them much, there’s others that it sounds like it’d put them on life support or even force them to close. Dynamic Forces moved to expedite their motion to get paid by (old) Diamond and state they’re now owed over $1 million and if they’re not paid, they wouldn’t be able to make their payroll.

Eight retailers opened their books to us with roughly $2.5 million in retail value and about $1 million owed to them currently tied up in this mess. It’s unknown what (old) Diamond has and what (new) Diamond has but the general feedback is they have yet to be paid for any of that either way. With 128 publishers listed in Diamond’s motion, that’s potentially well over $15 million owed to publishers.

There’s still time for publishers to speak up on this. A hearing is set before Honorable Judge Rice on July 21, 2025 at 10:00 am in Courtroom 9-D at the United States Bankruptcy Court for the District of Maryland, 101 W. Lombard St., Baltimore, MD 21201.

Objections to the Motion must be in writing and filed with the Clerk of the Bankruptcy Court, 101 West Lombard Street, Suite 8530, Baltimore, Maryland 21201, on or before July 16, 2025; and be served so as to be received on or before the Objection Deadline by the undersigned counsel for the Debtors.