Tag Archives: sparkle pop llc

Update: JPMorgan and Sparkle Pop’s Time to Respond to Questions over their Interest in Diamond Inventory Extended

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The Diamond chapter 11 process is now chapter 7 and with that, it creates a ripple across numerous related lawsuits. One such group of lawsuits involves JPMorgan‘s “Validity, Priority or Extent of a Lien or Other Interest in Property.” In question is inventory that Diamond has that is consignment goods provided by publishers. The goods are being held in a warehouse controlled by Sparkle Pop. It is before the court as to figure out who actually owns the inventory. Does Diamond, who can then sell it and pay back its creditors, like JPMorgan? Also, what claim does JPMorgan have as far as the inventory since the inventory was used as collateral by Diamond to get a loan?

The question concerns multiple lawsuits spanning multiple publishers with all of the various court documents similar. JPMorgan now has until February 16, 2026 to respond to this.

Update: Sparkle Pop‘s time to respond to the same complaint has also been extended to February 16. The order is below.

Original complaint example:

Sparkle vs. Alliance? Yeah, that’s still going on too!

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Diamond‘s chapter 11 process has spun out enough drama that it’s worthy of a television miniseries. There’s multiple lawsuits dealing with it and of course a fight over the chapter 11 process itself. One of those is Ad Populum/Sparkle Pop, one of the winners of Diamond’s assets, suing Alliance Entertainment (one of the bidders) over broken NDAs and corporate espionage. That lawsuit launched in June 2025 with our last update in late July. So, let’s catch up!

Alliance attempted to dismiss the case which was opposed by Sparkle Pop with Diamond submitting more to try and support their motion.

A pretrial conference was held on November 10, 2025 to discuss the amended complaint by Sparkle Pop against Alliance as well as the motion to dismiss things and the opposition to that.

In early November, Alliance Entertainment motioned for sanctions in the “form of attorney’s fees and expenses, and for such other and further relief as
the Court may deem just and proper.”

In the motion, Alliance calls Sparkle Pop’s action “frivolous” and points that Diamond has its own claim for breach of the NDA against Alliance, so Sparkle Pop can’t have the right to do that. If Diamond can sue Alliance for breaching the NDA, then Sparkle Pop doesn’t is the short of it.

But, that didn’t last long because Alliance withdrew their motion for sanctions less than a week later…

Alliance was then informed November 14 they were missing their “Corporate Ownership Statement” and if it wasn’t filed by December 1, the case could be dismissed.

On the same day, an order was released denying Alliance’s motion to dismiss the lawsuit.

And to add to the fun, on November 17, 2025, Sparkle Pop was also informed they didn’t have a “Corporate Ownership Statement” and if it’s not filed by December 1, the case would be dismissed.

In a Thanksgiving treat, Alliance filed their answers to the amended complaint where they agree with or disagree with what Sparkle Pop claims in their complaint. Basically, are there basic facts they can agree on.

Sparkle Pop’s statement of ownership was eventually filed December 1. It states that Qanah Co, Inc. owns 10% or more interest in the company and there’s three other limited liability companies and one individual that make up Ad Populum and somehow doesn’t know the citizenship of that individual member.

Also on December 1, a discovery plan was submitted by the counsels.

That ownership document about Sparkle Pop? That got amended… they spelled the name of one of the owners incorrectly. It’s Qavah not Qanah.

So where do things stand? A final pre-trial conference is set for August 6, 2026 with a list of exhibits and witnesses to be filed at some point in the future.

Sparkle Pop vs. Dynamic Forces Lawsuit is Dismissed

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One of the numerous lawsuits to spin out of Diamond’s chapter 11 has come to an end. A filing today has stated the lawsuit between Sparkle Pop and Dynamic Forces and counterclaim by Dynamic Forces and Sparkle Pop has been dismissed. A reason for the dismissal has not been given, just that it’s voluntary. In October, the lawsuit and fight between Dynamic and “old” Diamond ended with an agreement.

IT IS HEREBY STIPULATED AND AGREED by and between the undersigned that pursuant to Rule 41(a)(1)(A)(ii) and 41(c)(1) of the Federal Rules of Civil Procedure Plaintiff Sparkle Pop, LLC (“Sparkle Pop” or “Plaintiff”) hereby gives notice that the above-captioned action against Defendant Dynamic Forces, Inc. (“Dynamic” or “Defendant”);is voluntarily dismissed, without prejudice, and it is further stipulated and agreed that Defendant’s counterclaim (s) in the above-captioned action against the Plaintiff are voluntarily dismissed, without prejudice.

Dynamic Forces, aka Dynamite, responds to Sparkle Pop’s Breach of Contract Lawsuit. Files Counterclaim Against Sparkle Pop!

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Dynamite Entertainment

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.

Sparkle Pop is Suing Dynamic Forces aka Dynamite, for Breach of Contract. Seeking over $1.7 million.

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Dynamite Entertainment

2025 is the year of comic related lawsuits and court filings. In September Sparkle Pop filed a civil action against Dynamic Forces, aka Dynamite Entertainment over a breach of contract.

In its introduction, 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 contract between Dynamic and Diamond (the original, “old” Diamond) began on October 1, 2015 and Diamond was Dynamic’s “exclusive worldwide distributor. Dynamic was to reimburse Diamond for “storage fees, freight costs, certain marketing-related expenses, and other costs.” The lawsuit claims Dynamic failed to reimburse Diamond for those costs and fees. Sparkle Pop, the owner of “new” Diamond, is suing over that and claims they have made efforts to collect the receivables since they closed in purchasing Diamond in May 2025.

The lawsuit’s counts are:

  • Breach of Contract – Dynamic and Diamond had an agreement and Diamond performed its obligations under the agreement. Dynamic failed to reimburse Diamond and Sparkle Pop for those costs and expenses. That total sum is in excess of $1.7 million dollars.
  • Quantum Meruit Recovery – Diamond has performed its services which has benefited Dynamic. Dynamic has been “unjustly enriched” and Sparkle Pop is entitled to recover the reasonable value of the services provided. An amount will be determined at trial but it includes interest, costs, and more.

Sparkle Pop is looking for damages including interest and costs, disbursements, and attorney’s fees. A summons was issued to Dynamic on September 15.

Where it gets crazier is that Dynamic and Dynamite are suing Sparkle Pop/”new” Diamond and claiming they are owed over $500,000 themselves.

Sparkle Pop submits their Certification They’ve Stopped Selling Consigned Inventory

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Last week, the court released their decision as to what to do about Sparkle Pop having sold consigned inventory when they shouldn’t have during Diamond’s chapter 11 process.  It was a rather open and shut case in a general sense, so it was all about the details with this one as to how it needed to be resolved. The court decided:

  1. Sparkle Pop needs to stop all sales, marketing, and advertising of the goods held on consignment. Sparkle Pop has said they’ve already stopped, so this one was pretty open and shut. Sparkle Pop still needs to file a written Certification to the court that it has complied.
  2. Sparkle Pop needs to provide to Diamond and to two of the groups representing some publishers a detailed account, certified by an officer of Sparkle Pop, that has the name of the vendor who provided the product, the name and title of the product, the SKU, and other identifying information, the gross sale proceeds received, the quantity sold and date sold, and the manufacturer’s retail price of the product.
  3. Sparkle Pop needs to pay the gross proceeds of the sale of the consigned inventory into the Registry of the Court. It’ll be held by the court until other decisions have been decided. If any other money comes in due to this, that’ll be turned over too.
  4. The TSA and APA Sparkle Pop agreed to is still in force.
  5. Diamond’s move for damages included attorneys’ fees and costs related to the recovery will be heard at a later date.
  6. JPMorgan Chase Bank’s claims and liens when it comes to the consigned inventory isn’t impacted by this.

Sparkle Pop has submitted their paperwork that certifies they have stopped selling the consigned inventory and removed it from the website and marketing.

I hereby certify that Sparkle Pop has removed all Consigned Inventory (as defined in the Order) from its (and/or any affiliate of Sparkle Pop’s) website, order forms, marketing materials and all other forms of product marketing and sales materials as of the date of the Consent order;

Sparkle Pop has ceased all sales of Consigned Inventory as of the date of the Consent Order.

Diamond vs. Sparkle Pop… The Court’s Decision Released!

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Earlier this week, there was a hearing regarding Sparkle Pop‘s sale of consigned inventory they shouldn’t have been selling brought forth by Diamond as part of their chapter 11 drama. While the actual hearing was resolved it seems rather quickly, we’ve been waiting for the official order with the details as to what the court decided. It was a rather open and shut case in a general sense, so it was all about the details with this one.

You can read the full filing below after the summary of what the court had to say.

  1. Sparkle Pop needs to stop all sales, marketing, and advertising of the goods held on consignment. Sparkle Pop has said they’ve already stopped, so this one was pretty open and shut. Sparkle Pop still needs to file a written Certification to the court that it has complied.
  2. Sparkle Pop needs to provide to Diamond and to two of the groups representing some publishers a detailed account, certified by an officer of Sparkle Pop, that has the name of the vendor who provided the product, the name and title of the product, the SKU, and other identifying information, the gross sale proceeds received, the quantity sold and date sold, and the manufacturer’s retail price of the product.
  3. Sparkle Pop needs to pay the gross proceeds of the sale of the consigned inventory into the Registry of the Court. It’ll be held by the court until other decisions have been decided. If any other money comes in due to this, that’ll be turned over too.
  4. The TSA and APA Sparkle Pop agreed to is still in force.
  5. Diamond’s move for damages included attorneys’ fees and costs related to the recovery will be heard at a later date.
  6. JPMorgan Chase Bank’s claims and liens when it comes to the consigned inventory isn’t impacted by this.

None of the above is surprising, it really came down to where the money would be held.

Sparkle Pop releases its Witness and Exhibit List before Wednesday’s Hearing

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There’s a lot of balls in the air when it comes to Diamond‘s chapter 11 process. Wednesday, September 10 is the next hearing, this one having to do with Sparkle Pop having sold consignment goods when they weren’t supposed to.

The short version, Diamond still has a lot of inventory in its possession that are on consignment. Diamond wants to sell the inventory to raise money so it can pay back its lender, JPMorgan Chase Bank. But, publishers don’t want them to and have filed been fighting to stop their motion. During that, it was revealed that Sparkle Pop had sold a bunch of the goods on consignment when they shouldn’t have.

Diamond filed a motion at the end of August to force Sparkle Pop to stop selling the inventory and also asking for some sort of damages. Sparkle Pop has said they have stopped selling the inventory and have the money set aside and waiting to be told what to do with it by the court and blamed Diamond for the issues. Then, there’s publishers who have some issues with Diamond’s motion against Sparkle Pop. Diamond released its witness and exhibit list as well as took at some shots at Sparkle Pop’s filing.

Now, ahead of the hearing which takes place today, Sparkle Pop has released its own witness and exhibit list.

While it doesn’t name any specific individuals, Sparkle Pop has stated it reserves the right to call:

  1. any person listed or called as a witness by any other party;
  2. any person necessary to establish the authenticity or admissibility of exhibits;
  3. (any person for purposes of impeachment; and
  4. any person for purposes of rebuttal.

That could change though as things play out.

The exhibit list has much of what we’d expect like the various agreements Sparkle Pop agreed to when it purchased Diamond’s assets but there’s a few items that do stand out.

  • May 27, 2025 Email from Diamond Comic Distributors to Vendors regarding VENDORS Important Update on Outstanding Invoices and Future Payments
  • Sparkle Pop document production in response to Subpoena, Bates stamped SP000001-SP000079

So, there’s some email that went out from Diamond to vendors regarding invoices and payments, most likely clarifying who is responsible for what after the purchase but there might be more. Also, there’s document production and who knows what might be in there.

You can check out the full filing below:

Diamond replies to Sparkle Pop’s Objection calling it “Self-Serving Misdirection”

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There’s a lot of balls in the air when it comes to Diamond‘s chapter 11 process. Wednesday, September 10 is the next hearing, this one having to do with Sparkle Pop having sold consignment goods when they weren’t supposed to.

The short version, Diamond still has a lot of inventory in its possession that are on consignment. Diamond wants to sell the inventory to raise money so it can pay back its lender, JPMorgan Chase Bank. But, publishers don’t want them to and have filed been fighting to stop their motion. During that, it was revealed that Sparkle Pop had sold a bunch of the goods on consignment when they shouldn’t have.

Diamond filed a motion at the end of August to force Sparkle Pop to stop selling the inventory and also asking for some sort of damages. Sparkle Pop has said they have stopped selling the inventory and have the money set aside and waiting to be told what to do with it by the court and blamed Diamond for the issues. Then, there’s publishers who have some issues with Diamond’s motion against Sparkle Pop.

In the lead up to Wednesday’s hearing, Diamond has released its witness and exhibit list and responded to Sparkle Pop’s objection to the whole thing. And Diamond responds with some big swings and drops some emails.

In its reply, Diamond doesn’t mince words calling Sparkle Pop’s objection “self-serving misdirection.” They mock Sparkle Pop’s framing that it was “trying to do the right thing for all parties.”

In their response they say Sparkle Pop’s objection doesn’t explain and leaves out:

  • The purchase agreement provided Sparkle Pop reimbursement for the cost and expenses in connection to the consigned inventory when the sales were at the direction of the debtors.
  • Diamond is paying Sparkle Pop for the storage of the consigned inventory and instead says Sparkle Pop criticized Diamond for “failing to remove such consigned inventory.”
  • The consigned inventory is distinguishable from the “owned” inventory by the coding system that was handed over to Sparkle Pop by Diamond when Sparkle Pop purchased Diamond’s assets.
  • Sparkle Pop has provided information as to what consigned inventory was sold showing it knows what is consigned inventory.
  • Sparkle Pop didn’t respond to Diamond’s demand to stop selling the consigned goods and hand over all of the proceeds to Diamond. Nine emails were sent that are part of the exhibit filed with this motion.
  • Sparkle Pop asked Diamond if the consigned inventory should be included on its website and ignored the response by Diamond’s counsel to remove the inventory from the website.
  • Sparkle Pop never told Diamond it was segregating the proceeds from the sale of consigned inventory.
  • Sparkle Pop doesn’t seem to get the impact of the automatic stay that’s in place concerning consigned goods.

It also highlights some agreements:

  • Sparkle Pop has stopped selling the consigned goods.
  • The proceeds from the sale should be held but there’s disagreement as to who should manage it until it’s decided what to do with it.
  • The inventory should be removed from Sparkle Pop’s website.

Diamond feels that the court should still tell Sparkle Pop to stop selling the inventory and remove it from their website and marketing materials. The gross proceeds should be handed over to Omni Agent Solutions which is managing already as an escrow agent connected to funds dealing with the sale process. Finally, Diamond will figure out damages at a later date.

The emails are interesting and reveal some new info, but also seem to be missing responses from Sparkle Pop:

  • Sparkle Pop was late in some of its payments owed to Diamond
  • Sparkle Pop put forth a scenario where it would purchase the consigned goods but Diamond thought it was too low.
  • From May 16 to July 8 $1,353,364 was the amount of sales of consignment inventory.
  • After that amount there was an additional $31,258.60 sold for a total of $1,384,622.60.
  • There was disagreement of who would pay customs of goods shipped before purchase but didn’t get through customs until after.
  • “I am following up since we never heard back from you after our conversation last evening. Have you had an opportunity to discuss our proposal with your client?” <- What was this proposal about?

Wednesday should be an interesting one!

Diamond releases its Witness and Exhibit List for Wednesday’s Hearing Regarding Sparkle Pop Selling Consigned Goods

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There’s a lot of balls in the air when it comes to Diamond‘s chapter 11 process. Wednesday, September 10 is the next hearing, this one having to do with Sparkle Pop having sold consignment goods when they weren’t supposed to.

The short version, Diamond still has a lot of inventory in its possession that are on consignment. Diamond wants to sell the inventory to raise money so it can pay back its lender, JPMorgan Chase Bank. But, publishers don’t want them to and have filed been fighting to stop their motion. During that, it was revealed that Sparkle Pop had sold a bunch of the goods on consignment when they shouldn’t have.

Diamond filed a motion at the end of August to force Sparkle Pop to stop selling the inventory and also asking for some sort of damages. Sparkle Pop has said they have stopped selling the inventory and have the money set aside and waiting to be told what to do with it by the court and blamed Diamond for the issues. Then, there’s publishers who have some issues with Diamond’s motion against Sparkle Pop.

So, that’s what’s being covered on September 10.

For witnesses, Diamond has called Robert Gorin who is the co-Chief Restructuring Officer and Ramy Aly who is the Senior Director, Getzler Henrich & Associates, LC. Both will have knowledge of the agreements of the sale of Diamond’s assets to Sparkle Pop. Those assets did not include consigned goods.

As far as the exhibits, there’s various agreements, email that is likely Diamond telling Sparkle Pop to stop selling the inventory, and most importantly, the consignment inventory list. If it’s released, it’ll be the first time we’ve gotten idea as to what inventory Diamond still has access to.

The hearing will take place September 10 and 10am ET.

Check out the full list filed below:

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