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Judge slaps down Stan Lee Media’s bid for Marvel characters

marvel heroes

A federal judge on Thursday dismissed Stan Lee Media’s multibillion-dollar lawsuit against Disney, potentially ending its long and confusing legal battle to claim ownership of the Marvel characters co-created by Stan Lee. The failed dot-com has had no connection to its co-founder and namesake in more than a decade; in fact, the two have sued each other on a few occasions.

As Deadline reports, in granting Disney’s motion to dismiss the 2012 copyright-infringement complaint, U.S. District Judge William J. Martinez didn’t attempt to hide his annoyance with the litigious Stan Lee Media, whose tangled web of lawsuits began it at least 2007, just months after the company emerged from federal bankruptcy protection.

“Plaintiff has tried time and again to claim ownership of those copyrights; the litigation history arising out of the 1998 Agreement stretches over more than a decade and at least six courts,” Martinez wrote in his 11-page order. “Taking its cue from the Southern District of New York and the Central District of California, this Court holds that Plaintiff is precluded from re-litigating the issue of its ownership of copyrights based on the 1998 Agreement …” He said it would be “futile” to permit Stan Lee Media to amend the lawsuit.

The dispute has its roots in Marvel’s 1998 bankruptcy, when CEO Isaac Perlmutter ended the $1 million-a-year lifetime contract with Lee, negating the legendary writer’s assignment to the company of his rights to his co-creations. It also freed Lee to form Stan Lee Entertainment, which later merged with Stan Lee Media, with infamous entrepreneur Peter F. Paul. That company in turned filed for bankruptcy in February 2001.

All of the lawsuits filed by SLM’s shareholders hinge on a sequence of events that took place between August 1998, when Marvel terminated Lee’s employment, and November 1998, when Lee entered into a new agreement with the House of Ideas and signed over his likeness, and any claims to the characters. Stan Lee Media has long claimed that on Oct. 15, 1998, Lee transferred to that company the rights to his creations and his likeness (that’s the “1998 Agreement” Martinez references in his order). SLM asserted in its 2012 lawsuit that neither Marvel nor Disney, which bought the comic company in 2009, ever registered Lee’s November 1998 agreement with the U.S. Copyright Office. Therefore, the plaintiffs argued, they actually own the Marvel characters and were owed $5.5 billion in profits from such blockbuster films as The Avengers, X-Men: First Class and Thor, and the Broadway musical Spider-Man: Turn Off the Dark.

However, Martinez agreed with Disney’s claim that the 1998 agreement was vague — it merely referred to comic book characters that Lee “had previously created or would create” — and didn’t provide Stan Lee Media with the proof of ownership of a valid copyright required to file a copyright-infringement lawsuit.

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6 Comments

though the thing is not over for odds are stan lee media will appeal . even though glad the judge saw how they did not have a claim for stan lee does not own the marvel characters they were a work for hire.

@demoncat4, Stan Lee is not Stan Lee Media–the company holds his name but has nothing to do with him. He cut ties years ago and they refused to change the name.

That said, Lee was Editor in Chief when he was at Marvel–not a “work for hire” writer. He did the hiring.He never had to claim he owned any characters since he was paid royalties (unlike the work for hire artists and writers under him).

Ramone–

Where are you getting that? As far as I know, and I’m pretty versed in the behind-the-scenes history, Stan Lee was never paid royalties when he was scripting comics back in the ’60s. He was paid a page rate for that work and nothing else like every other Marvel freelancer of the time.

@Ramone:

In addition to what Robert said, it’s important to note that being the EIC wouldn’t change the issue of ownership or Marvel’s financial commitment to Lee. His position is irrelevant.

Being a salaried employee, the creations would’ve still been so-called “work product” and, thus, the property of the employer. By default, that’s how it works in many industries and it’s no different here. Any deviation from the defaults would be something else.

What I find interesting is the signing away of his likeness. Even at an advanced age, I’m not sure I could do that.

Has anyone ever won one of these legal battles with the major comic companies? While the companies may have a moral obligation to KIrby, Siegel and Shuster etc, and their families, the latter never seem to have a good case in law, mainly because the creators signed everything away in exchange for a sum at the outset or a regular income. Siegel and Shuster further weakened their case by accepting a cash arrangement towards the ends of their lives (and I’m well aware that Shuster in particular was in dire need of it).

Depends on what you mean by “won”. Joe Simon won his battle with Marvel over Captain America and with Archie over The Fly and the Shield. Bob Kane won his Batman case- although I don’t think that ever went as far as to go to court. Siegel and Shuster won over Superboy. And technically they won Superman- as their heirs are getting paid whopping sums of money for DC’s continued use of the characters.

However the source of all these cases is the fact that the original creators never signed anything. Comic book publishers routinely relied on oral “agreements” and lack of paper work to protect themselves, thus creating the grounds for endless years of litigation that a simple written contract could have avoided.

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