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Archie Comics executives settle bitter, bizarre legal battle

Nancy Silberkeit with Jon Goldwater (right) and Archie Comics Editor-in-Chief Victor Gorelick

The yearlong legal feud for control of Archie Comics has ended with a settlement that restores embattled Co-CEO Nancy Silberkleit to her position at the company. However, the confidential agreement was criticized by the granddaughters of Archie co-founder John L. Goldwater, who claim that both executives’ “hands are dirty.”

The Associated Press reports that Manhattan Supreme Court Justice Shirley Werner Kornreich approved the deal Wednesday, bringing to a close the bitter, and frequently outlandish, dispute between Silberkleit and Co-CEO Jon Goldwater that became public in July 2011, when Archie accused Silberkleit of bullying and sexually harassing employees and sued to bar her from the company’s Mamaroneck, New York, headquarters.

Silberkleit, who stepped into the role of co-CEO in 2009, following the death of her husband Michael Silberkleit (son of Archie Comics co-founder Louis Silberkleit), countered that Jon Goldwater is a chauvinist who was mounting a smear campaign to drive her out of the company, and sought $100 million in damages for defamation. The fight escalated in January when Goldwater, son of John L. Goldwater, sued to have Silberkleit removed as a director and CEO, claiming, “Unless Silberkleit is removed as a director and an officer, the company — an iconic American company — is in serious danger of failing and being liquidated.” That was quickly followed by a temporary restraining order prohibiting Silberkleit from “harassing, yelling at or abusing” anyone at Archie’s headquarters or having any contact with staff and vendors regarding matters other than those required by her employment contract.

Wednesday’s settlement allows Silberkleit, who as co-executor of her late husband’s estate, controls a 50 percent stake in Archie, to return to the office and resume her duties overseeing the company’s scholastic and live theatrical endeavors. Goldwater, who owns 25 percent of the shares, handles everything else. The remaining shares are held by a trust established by Goldwater’s half-brother Richard Goldwater, who passed away in 2007.

“Nancy Silberkleit and Jon Goldwater are no longer in an adversarial position, and they are beginning their working relationship anew,” Silberkleit’s attorney, Howard Simmons, said in a statement. “She’s thrilled to have settled this extremely upsetting matter.”

Kornreich signed off on the settlement over the objections of Richard Goldwater’s daughters, Lisa, Taylor and Summer Goldwater, who, after initially sitting on the sidelines, now accuse their uncle Jon Goldwater of misusing Archie assets and Silberkleit of drawing a company salary while still working as a teacher. In court papers, one of the daughters’ attorneys said the agreement is little more than a reciprocal exchange between “two directors who have been stealing from the company, or aiding and abetting each other’s theft.”

The judge said that while three didn’t have a legal standing to insert themselves into the settlement, the Richard Goldwater estate is free to pursue its own lawsuit.

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Comments

11 Comments

Funkygreenjerusalem

June 7, 2012 at 6:34 am

So, the daughters are accusing their uncle of misusing assets, despite the fact the companies fortunes have turned around under his leadership?
Man, the Archie heirs just want to kill that golden goose, don’t they?

Then the judge demanded that the parties each write two stories: one, in which the company was controlled by Silberkleit, and one in which the company was controlled by Goldwater.

No, Mr. Goldwater, Archie Comics is not “an iconic American company.” Archie is iconic. Jughead is a god. Archie Comics consumes creativity and excretes profits.

“So, the daughters are accusing their uncle of misusing assets, despite the fact the companies fortunes have turned around under his leadership?”

“Misuse of assets,” can mean many things. For example, if an officer or director is using assets for his or her personal gain instead of the stockholders, that can be misuse of assets even where the officer or director has “turned around” a company’s fortunes.

I’m not saying that is what happened here. I’m only pointing out that it is, in fact, possible to “misuse assets,” while turning around a company.

@Kenn:

Thanks for my laugh of the day!

interesting given how the two sides proved they could not get along lead to this court mess that now they wind up with a settlement working together again. wonder how long before they are back in court again over the same craziness

“So, the daughters are accusing their uncle of misusing assets, despite the fact the companies fortunes have turned around under his leadership? Man, the Archie heirs just want to kill that golden goose, don’t they?”

Read the full AP article. The trust for the daughters hasn’t earned a penny despite the fact they technically own 25% of the company. They assumed their uncle was working in their best interests when he became co-CEO. Apparently no profits or payments have been paid to them.

If they have the potential to sue, I suspect the behind-the-scene drama at Archie Comics is far from over.

Jake Earlewine

June 7, 2012 at 2:33 pm

Kenn, that was clever.

I saw what you did there, Kenn.

Hey, as long as this doesn’t affect the Sonic books, all is good. If Archie loses that license, there goes their largest money-maker and I don’t think today’s incarnation of Sega would be so keen to shop it around to another publisher. At least not with the same characters and setting.

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