Posted in: Comics, Current News | Tagged: Ad Populum, AENT, diamond

Diamond Comics' Claim AENT Poached Staff "Fails As A Matter Of Law"

AENT says that Ad Populum's claim against them for poaching staff from Diamond and breaking NDAs "fails as a matter of law"

Published Wed, 18 Jun 2025 05:57:04 -0500

by Rich Johnston

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Once upon a time, Diamond Comic Distributors filed for Chapter 11 bankruptcy and held an auction to divide its assets. Alliance Entertainment (AENT) won that auction, with Universal Distribution and Ad Populum/Sparkle Pop coming second as joint bidders. The courts (eventually) declared AENT the winner, but they suddenly pulled out, citing that they had been misled. So the back-up bidders won the auction, with Ad Populum/Sparkle Pop taking Diamond Comic Distributors while Universal got other associated companies. AENT then sued Diamond, alleging fraud over contracts. Then Ad Populum sued AENT, alleging the breaking of NDAs and non-hiring agreements, after AENT hired seven senior former employees of Diamond. Those staff members were:

Mike Schimmel, former Vice President of Sales at Diamond Comic Distributors, at Diamond for 21 years, and Capital City Distribution for over three years before that, now Senior Vice President of Sales at Alliance Entertainment.
Matthew Demory, who had been at Diamond Comic Distributors for thirteen years, moving from Comics Brand Manager to Print team Assistant Manager, now Product Manager/Buyer at AENT.
Joe Lunday, formerly Director of E-commerce Sales at Diamond Comic Distributors, and had been at Diamond since 1998 with a brief 8-month sojourn at Amazon in 2022, now Director of Collectible Sales at AENT.
Ryan Shelkett, who had two years as Executive Director of Vendor Development at Diamond Comic Distributors, seven years at Bandai, and another ten years at Diamond as a National Sales Manager before that, now Vice President of Purchasing at AENT.
Lee Butman, over twenty-five years at Diamond Comic Distributors, as Merchandise Purchasing Manager, and Toys Brand Manager before that, now Product Manager/Buyer at AENT.
Trista Peterson, former National and Outreach Sales Manager at Diamond since 2023, now AENT's Collectables Sales Director
Brennan West, former Diamond Purchasing Brand Manager, at Diamond since 2017, now AENT Product Manager.

Now, AENT is making the case with the U.S. Bankruptcy Court in Baltimore that Ad Populum/Sparkle Pop has no legal standing to enforce the NDA, as it was not a party to the agreement nor assigned its rights. And claims that the NDA was signed between AENT, Diamond, and Diamond's bankruptcy lawyer, Raymond James. AENT notes that a cease-and-desist letter sent on the 2nd of June, seen below, came from Diamond, not Ad Populum/Sparkle Pop. They state that "prior to the Auction, AENT entered into the NDA with Raymond James, on behalf of itself and DCD. The NDA was entered into because AENT 'requested certain information (oral, written, electronic or otherwise) relating to or concerning the Company, its subsidiaries and/or affiliates.' The NDA recognized that AENT signed the agreement 'for the benefit of [DCD] and Raymond James and their respective successors and assigns.' The Complaint does not allege that DCD or Raymond James assigned the NDA to Sparkle Pop. Nor did the Debtors assign any rights under the NDA to Sparkle Pop as part of the sale transaction. In fact, the asset purchase agreement between the Debtors and
Sparkle Pop expressly states that no contracts are being assigned to Sparkle Pop."

They also note that Ad Populum's own evidence proves that AENT did not solicit Diamond's former employees and that Diamond's "internal records reveal that most of the employees in question were terminated as part of a mass-layoff on May 16, 2025, or were seeking alterative employment opportunities months before they resigned, as employee morale tanked and instability permeated."

AENT Bruce Ogilvie makes a declaration, which is included in the filing under oath, backing much of this up, saying "Prior to the Auction, AENT entered into a non-disclosure and non-solicitation agreement with Raymond James & Associates, Inc, on behalf of itself and Debtor DCD. Importantly, Ad Populum is not a party to the NDA. When I signed the NDA on behalf of AENT, it was an agreement between AENT and DCD and its subsidiaries. There are no third-party beneficiaries. Further, the Debtors did not assign any rights under the NDA to Sparkle Pop as partof the sale transaction. In fact, the asset purchase agreement between the Debtors and Sparkle Pop expressly states that no contracts are being assigned to Sparkle Pop."

"Indeed, counsel for Debtors sent my attorneys a letter, dated June 2, 2025, incorrectly claiming certain alleged breaches of the NDA by AENT caused by AENT's employment of certain former employees of DCD. AENT denies such allegations and maintains that its actions did not violate the NDA or interfere with the business of any party, including Sparkle Pop. It is noteworthy that the letter did not come from Sparkle Pop, but rather DCD and its related Debtors—the only parties to and intended beneficiaries of the NDA."

The legal response is summed up, saying "the Complaint and the Motion… fail as a matter of law." There's more, much more to come, of course. Including how my work for Bleeding Cool is being cited in this case. Well, you know how I like to make everything about me, right? But for now, that cease and desist letter.