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Deadline reports that more than two years after the failed dot-com sued Paradox Entertainment in a bid to reclaim the rights to Robert E. Howard’s most famous character, the Ninth Circuit Court of Appeals has effectively delivered the deathblow to SLM’s case, upholding a lower court’s 2012 dismissal. Of course, we’ve learned by now that the company isn’t one to give up a legal fight.
Stan Lee Media, which hasn’t had a connection to its co-founder and namesake in more than a decade — in fact, it has sued Stan Lee on a few occasions — purchased the rights to the Conan characters in 2000, shortly before it entered federal bankruptcy protection. The company claimed its interests weren’t properly represented, nor were shareholders notified, when in 2002 Conan Sales Co. bought back the rights. The complaint also alleged that the late Arthur Lieberman, Stan Lee’s longtime attorney, committed fraud during the proceedings, and failed to report conflicts of interest. Therefore, SLM argued, the subsequent sale of the characters to Paradox Entertainment should be annulled.
Welcome to “Report Card,” our week-in-review feature. If “Cheat Sheet” is your guide to the week ahead, “Report Card” is typically a look back at the top news stories of the previous week, as well as a look at the Robot 6 team’s favorite comics that we read.
So find out what we thought about Waluk, Superior Spider-Man and more.
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.
Legal | A federal judge on Friday denied DC Comics’ bid for sanctions against the attorney for the heirs of Superman creators Jerry Siegel and Joe Shuster, finding that Marc Toberoff made “no deliberate attempt to mislead” during the discovery process and, perhaps more importantly, did not interfere with the publisher’s rights to the Man of Steel when he allegedly inserted himself into settlement talks in 2001. [The Hollywood Reporter]
Legal | Stan Lee will be deposed this week by lawyers representing Stan Lee Media in its multi-billion-dollar lawsuit against Disney involving the rights to the characters the legendary writer co-created for Marvel. Stan Lee Media, which no longer has ties to its namesake, claims Disney as infringed on the copyrights Iron Man, the Avengers, X-Men and other heroes since 2009, when it purchased Marvel. The long, tortured dispute dates back to a sequence of events that occurred between August 1998, when Marvel used its bankruptcy proceedings to terminate Lee’s lifetime contract, 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. SLM asserts in the latest lawsuit that neither Marvel nor Disney, which bought the comic company in 2009, has ever registered Lee’s November 1998 agreement with the U.S. Copyright Office. [The Hollywood Reporter]
Legal | Forbes profiles Michael Wolk, a lawyer who’s organized the financial backing for Stan Lee Media’s prolonged, and so far unsuccessful, multibillion-dollar lawsuits against Marvel and Disney over the rights to the characters co-created by Stan Lee. Wolk’s primary investor is Elliott Management, one the nation’s largest hedge funds. SLM, which is no longer affiliated with its co-founder and namesake, asserts Lee didn’t properly assign ownership of the works to Marvel, and that Disney didn’t file its Marvel agreement with the U.S. Copyright Office. “We are in the right here,” says Wolk, who’s not actually a Stan Lee Media shareholder. “No court has ever addressed or ever decided who is the owner of the characters — all of the prior litigation got dismissed for reasons that have nothing to do with who owns the characters.” [Forbes.com, via The Beat]
Legal | Disney has filed a motion to dismiss a $5.5 billion copyright-infringement lawsuit filed in October by failed dot-com Stan Lee Media Inc. in its sixth attempt to claim ownership of the Marvel characters co-created by Stan Lee. SLM, which is no longer affiliated with its co-founder and namesake, asserts Lee didn’t properly assign ownership of the works to Marvel, and that Disney didn’t file its Marvel agreement with the U.S. Copyright Office. Disney calls the lawsuit “completely frivolous,” and argues, in part, that the claims have already been litigated and rejected. [The Hollywood Reporter]
Publishing | As final print edition of The Dandy promptly sells out and the venerable U.K. children’s comic migrates online, David Fickling briefly discusses why he launched The Phoenix — a weekly geared for readers ages 6 to 12 — nearly a year ago, and why comics aren’t dead: “Reading comics was always a delight. Reading them under the bedclothes or the desk, even better. Now at last the experts are understanding the importance of reading comics. The loss of reading for pleasure has been identified as one of the principle reasons for falling standards of literacy. Perhaps part of the reason for our disgraceful literacy rates is that we don’t have comics. Comics are a link to books not competition; in short they are a great leveller.” [The Telegraph]
Undeterred by numerous legal setbacks, failed dot-com Stan Lee Media on Tuesday filed a $5.5 billion copyright-infringement lawsuit against Disney, claiming the entertainment giant doesn’t actually own the Marvel characters featured in such blockbuster films as The Avengers, X-Men: First Class and Thor, and the Broadway musical Spider-Man: Turn Off the Dark. The dollar amount reflects the estimated revenue from box-office receipts, licensing and merchandising dating back three years, the statute of limitations for copyright infringement.
The complaint, filed in federal court in Colorado and first reported by Deadline, has its roots in Marvel’s 1998 bankruptcy, when CEO Isaac Perlmutter ended the $1 million-a-year lifetime contract with Stan 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; just four months after SLM emerged from protection in November 2006, shareholders filed a $5 billion lawsuit against Marvel. Stan Lee Media 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.
In yet another legal blow to Stan Lee Media, a federal judge in California has dismissed its lawsuit against namesake and co-founder Stan Lee seeking billions in profits as well as ownership of the writer’s most famous co-creations.
Law 360 reports that while attorneys representing Lee, his POW! Entertainment and its subsidiary QED Productions had argued that the shareholder lawsuit was barred because an identical action filed in New York was dismissed in 2010, U.S. District Judge Stephen V. Wilson didn’t explain his decision to dismiss on Monday. A written order is expected later this week.
The failed-dot com has long claimed Lee improperly transferred rights to such characters as Spider-Man, the X-Men, Iron Man, the Avengers and Thor from Stan Lee Media to Marvel. The lawsuit is only part of a many-tentacled legal monster that was spawned in 1998, when Marvel CEO Isaac Perlmutter used bankruptcy procedures to end Marvel’s $1 million-a-year lifetime contract with Lee, negating Lee’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 now-infamous entrepreneur Peter F. Paul. The company filed for bankruptcy in February 2001, and emerged from protection in November 2006.
This lawsuit, like the one that came before it, hinged 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 company and signed over his likeness, and any claims to characters. Representatives of SLM previously have claimed that on Oct. 15, 1998, Lee transferred to that company rights to his creations and his likeness.
Wilson had permitted Stan Lee Media to renew its claim in February 2011, with the plaintiffs hoping a loss three months ago with the 2nd Circuit Court of Appeals would help pave the way for the California action. Apparently it didn’t.
Stan Lee has reached an agreement ending a legal dispute with two former shareholders of POW! Entertainment that threatened the future of his company, Hollywood Esq. reports. The terms of the deal are confidential.
POW! was formed in 2001 following Lee’s departure from bankrupt dot-com Stan Lee Media, and went public three years later through a reverse merger with Arturion Entertainment, a shell corporation controlled by public relations consultant Valerie Barth and UltaVision Inc. director Ron Sandman.
All seemed to go well, with Barth even working as Lee’s PR representative (she asserts she was instrumental in the creator receiving his star on the Hollywood Walk of Fame). But then last year POW! sued Barth and Sandman for breach of contract and fraud; the two struck back in May with a counterclaim accusing Lee and POW! executives Gil Champion and Arthur Lieberman (who passed away May 1) of conspiring to inflate the worth of the media company at the time of the reverse merger. They alleged Lee and his partners misrepresented POW!’s assets and provided documents demonstrating that the company controlled Lee’s intellectual property, including his name and likeness, and downplayed threats of litigation. (That same intellectual property forms the core of Lee’s complicated ongoing legal fight with Stan Lee Media.) In addition to $3.6 million in compensatory damages, Barth and Sandman sought the removal of POW!’s board of directors, and the transfer of shares.
According to documents filed with the U.S. Securities and Exchange Commission, POW! Entertainment generated just $24,628 in net income in 2011; the previous year, the company saw a $1.1 million net loss.
Legendary writer and editor Stan Lee, seemingly a magnet for lawsuits, has been drawn into yet another legal battle, one that could leave the future of his POW! Entertainment in question.
According to Hollywood, Esq., Lee and POW! executives Gil Champion and Arthur Lieberman, among others, have been sued for $3.6 million by two people who claim there was a conspiracy to inflate the worth of the media company’s assets at the time of a reverse merger in 2004 that allowed POW! to become publicly traded without slogging through the lengthy registration process.
Making the lawsuit more complex, or at least more dicey, is that one of the plaintiffs, Valerie Barth, worked for years as Lee’s public relations representative, and asserts she was instrumental in the creator receiving his star last year on the Hollywood Walk of Fame.
The claims are rooted in Lee’s departure in 2001 from the bankrupt dot-com Stan Lee Media — that company has its own winding history of lawsuits involving, at various times, its namesake, Marvel and Conan the Barbarian, among others — to form POW!, which in the past decade has struck deals with such companies as Disney, Archie Comics and BOOM! Studios. Three years later a reverse merger with a shell corporation called Arturian Entertainment allowed POW! to immediately go public.
Stan Lee Media, which just last month lost its bid to reclaim the rights to Conan the Barbarian, has been dealt another setback as an appeals court upheld a lower court’s decision preventing the failed dot-com from intervening in Stan Lee’s decade-old lawsuit against Marvel as part of an effort to gain control of the writer’s most famous co-creations.
However, Hollywood, Esq. reports the company hopes today’s ruling by the 2nd Circuit Court of Appeals will pave the way for pending action in California against its namesake and co-founder, whom it claims improperly transferred rights to such characters as Spider-Man, the X-Men, Iron Man, the Avengers and Thor from Stan Lee Media to Marvel. A judge had stayed the lawsuit last year pending the 2nd Circuit decision.
Lee sued Marvel back in 2002, claiming the company breached a conditional assignment of his copyright in Spider-Man when it failed to pay him 10 percent of profits from Columbia Pictures’ Spider-Man movie. He received a partial summary judgment before entering into a confidential agreement with Marvel. Stan Lee Media attempted to intervene in the dispute as the real party of interest, but was rejected by the judge because the company had gone into bankruptcy the previous year, and none of the shareholders could demonstrate they had legal standing or the authority to represent SLM.
A federal judge has dismissed a bid by Stan Lee Media Inc. to reclaim the rights to Conan the Barbarian, which the failed dot-com briefly held before going into bankruptcy in 2001. However, a bigger legal brawl still lies ahead, when the company appears before the 2nd Circuit Court of Appeals on March 8 to argue it should be allowed to pursue the rights to Spider-Man, the Fantastic Four, The Avengers and other lucrative Marvel properties.
Stan Lee Media, which operates independently of its namesake and co-founder — in fact, it’s suing Stan Lee — has struggled since emerging from bankruptcy in November 2006 to regain some of the money and glory from the heyday of the Internet bubble, primarily through lawsuits claiming the improper transfer of intellectual properties.
In the Conan lawsuit, filed in August even as Conan the Barbarian 3D arrived in theaters, the company claimed, in part, that when Conan Sales Co. bought back the rights to the Robert E. Howard characters in 2002, shareholders weren’t notified, and SLM’s interests weren’t properly represented. The complaint also alleged that Arthur Lieberman, Lee’s longtime attorney, committed fraud during the proceedings, and failed to report conflicts of interest. As a result, SLM argued, the transfer of the rights to Conan Sales Co., which subsequently sold them to Paradox Entertainment, should be annulled.
Publishing | On the heels of Monday’s direct-market overview for March, ICv2 has released its sales estimates for the month, placing the top-selling FF #1 at 114,472 copies — more than 37,500 ahead of the No. 2 title, Green Lantern #64. The retail news and analysis site notes that the relaunched FF #1, aided by variant covers, joins the Human Torch-killing Fantastic Four #587 as the only titles to sell more than 100,000 copies in the past six months.
While 11 of the Top 25 comics saw sales increases, if only slight, the graphic novel category looked decidedly more grim, with just the third volume of The Unwritten and Batman and Robin: Batman Reborn breaking the 4,000-copy mark. [ICv2.com]
Crime | Los Angeles police have recovered a copy of Action Comics #1 stolen from the home of actor Nicolas Cage in 2000. The 1938 comic, worth as much as $1.5 million, was discovered last month by an unidentified man who claims to have bought the contents of an abandoned San Fernando Valley storage locker. It’s now in an LAPD evidence safe while the department’s art details detectives try to track down the thieves, but Cage says he can’t wait to get the comic back. “It is divine providence that the comic was found and I am hopeful that the heirloom will be returned to my family,” he said in a statement. [Ventura County Star, Los Angeles Times]
Little more than a week after one judge had seemingly ended a decade-old dispute between Stan Lee Media and Stan Lee and Marvel, another court is reviving it.
THR, Esq. reports that U.S. District Judge Stephen Wilson is allowing the new board of failed dot-com Stan Lee Media to file a new consolidated complaint against Lee, alleging that he improperly transferred rights to such characters as Spider-Man, the X-Men, Iron Man, the Avengers and Thor from SLM to Marvel.
The original $750-million lawsuit — that was about half of the estimated proceeds from Marvel’s movies — was filed against Lee and Marvel in January 2009 by two SLM shareholders who were later determined to lack standing. An appeal was dismissed in December 2010, followed early this month by a ruling that the plaintiffs’ motions were time-barred, as they come a decade after the alleged injury. But now a newly elected board of directors has successfully petitioned Wilson to permit the complaint to move forward, this time only against Lee, QED Productions and POW! Entertainment. Marvel and DC aren’t named in the lawsuit.
As confusing as the case’s journey through the courts has been, it’s nothing when compared to the complicated backstory: In 1998, Marvel CEO Isaac Perlmutter used bankruptcy procedures to end Marvel’s $1 million-a-year lifetime contract with Lee, negating Lee’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 now-infamous entrepreneur Peter F. Paul. The company filed for bankruptcy in February 2001, and emerged from protection in November 2006. The lawsuit — and the $5-billion one that came before it, in March 2007 — hinged 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 company and signed over his likeness, and any claims to characters. Representatives of SLM previously have claimed that on Oct. 15, 1998, Lee transferred to that company rights to his creations and his likeness.
Stan Lee Media is seeking unspecified punitive or exemplary damages, a declaration of the company’s rights and an injunction against further infringement.
Publishing | The 61st volume of Eiichiro Oda’s insanely popular pirate manga One Piece sold more than 2 million copies in its first three days of release, according to the Japanese market-survey firm Oricon. It’s the fastest-selling book in the Oricon chart’s nearly three-year history, breaking the previous record set by the 60th volume of One Piece, which sold more than 2 million copies in four days. [Anime News Network]
Retailing | Heidi MacDonald talks to Dave Bowen, Diamond’s director of digital distribution, about the newly announced deal with iVerse Media that will allow retailers to sell digital comics in their stores: “The retailer will login using their Diamond retailer login and be presented with the opportunity to create store-specific, item-specific codes in whatever quantities they need. Then we’ll use some approved cryptographically secure method to generate random codes for the retailer to use. And we’ll format those in a PDF which they can then print out. Likely what will happen is, it’ll print easily on Avery 30-up laser labels. So what you have is a sheet of Avery laser labels with a bunch of different books and codes on individual labels. In that case the retailer takes that material and secures it and then when someone wants Transformers #16 they simply ring the sale and give the label or sticker or cut-out to the consumer. […] It’s really very simple. Then the consumer that has that code, which is live, they could literally step out of the line, pull out their iphone or ipad or whatever other device and redeem the code and begin reading the material.” Meanwhile, Todd Allen dissects what he describes as “a particularly silly digital download scheme.” [The Beat, Indignant Online]