Almost there! The dispute over the Diamond consignment inventory owned by Aspen, Black Mask Studios, DSTLRY, Heavy Metal International, Magnetic Press, Massive Publishing, Oni-Lion Forge Publishing, Panini UK, Alien Books, Graphic Mundi, Titan Publishing Group, Vault Comics, and Dark Horse Comics (known as The Palik Group in court filings) seems to be settled, legally anyway.
On Monday the judge approved the settlement agreement that was reached between the Palik Group, the Diamond Bankruptcy Trustee, and Sparkle Pop. As a reminder, the players here included publishers, whose inventory had been stored at the Diamond warehouse; Sparkle Pop which purchased Diamond’s assets including the lease to the Olive Branch warehouse which contains $50 million worth of publisher inventory; and the Diamond estate, which is going through Chapter 7 bankruptcy and run by trustee Morgan J. Fisher.
This settlement includes money going to Sparkle Pop for storing the inventory, money for the estate and procedures to publishers to go into the warehouse and Pik&Pak & Palletize the remaining inventory.
I’m a little tired of this story so I will link to Graphic Policy’s alway excellent summary of the settlement:
The deal includes:
- The Palik Consignment Group are granted Chapter 11 administrative expenses;
- Money in Court Registry Escrow will be released to the Trustee;
- When the settlement agreement with the Ad Hoc Consignment Group (the other publishers) is approved, the Trustee will disburse $308,890 to Sparkle Pop with remaining funds going to the Trustee;
- The SP Escrow will be released to Sparkle Pop. That amount is $105,856;
- The Distribution Agreements of the Palik Consignment Group are officially rejected;
- Adversary Proceedings will be dismissed;
- The Trustee will file a notice that the Consigned Inventory is abandoned and belongs to the Palik Consignment Group;
- Sparkle Pop will get inventory of the default judgements including Digital Manga, Net Comics, Valiant, and the inventory covered in the Image Comics settlement.
Nice warp up, which includes abandoned inventory and the left over inventory from the long ago Image settlement long ago. And that will be that – although the adventure of Palletizing remains. I imagine there will be a few BarCon stories about that at ComicsPro.
Also remaining, the OTHER group of publishers, The Consignment Group, which includes Ablaze, American Mythology, Avatar Press Battle Quest Comics, Action Lab Comics, Drawn & Quarterly, Fantagraphics, Green Ronin, Hermes Press, Living the Line, Paizo, UDON, and Zenescope, with Boom and Dynamite also taking part. This settlement did not include a payout for Sparkle Pop, and drew a sharp objection from them. The matter will be settled at a hearing on November 2nd.
With the Palik Group having compensated Sparkle Pop for storing the inventory, I imagine the Consignment Group will also have to make some kind of compromise here. I can’t imagine anyone wants to drag this out over two year old inventory at this point.
Indeed, as Milton Griepp points out at ICv2:
While the release of this inventory will be a welcome step, it does not make these publishers whole. Some of the inventory has been devalued by age; the publishers are giving up cash collected from the sale of their inventory by Sparkle Pop; they’ve endured significant legal costs; and the capital they invested in that inventory has been tied up for almost two years.
As I’ve noted every time I cover this story: what a waste. Of time and money.
As I see it only a few things remain in Diamond’s bankruptcy: a final settlement for The Consignment Group; and settling the estate’s debt to Chase Bank. I will keep checking those filings to bring this story to its conclusion!
