Posted in: Comics, Comics Publishers, Current News, Fantagraphics | Tagged: Ad Hoc, diamond

Diamond Must Now Act Against Each Publisher Before Liquidating Comics

It has been confirmed that Diamond Comic Distributors Inc., the debtor in this bankruptcy, must now act individually against each publisher before liquidating all their comics.

Published Tue, 26 Aug 2025 07:57:05 -0500

by Rich Johnston

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Last week, Bleeding Cool reported from the first day of the hearings of the Diamond Comic Distributors Chapter 11 bankruptcy case being held in the Bankruptcy Court of Baltimore with the news that the comic book publishers had won round one against Diamond Comic Distributors, Inc., the debtors in the bankruptcy. Who had been trying to liquidate all the stock held on consignment for the owners, the publishers, with the proceeds not going to the publishers, but to the banks.

Bleeding Cool specifically reported that the Ad Hoc Committee's Motion to Stay against Diamond had been granted, which meant that the liquidation motion had been halted until the matter moved into adversary proceedings. And that Diamond the debtor would now have to raise a legal case against each and every consignment vendor, publisher, and manufacturer whose stock they hold on consignment, individually, in adversary proceedings, if they wanted to liquidate any of those consigned comic books. Which, given that there are hundreds of publishers involved, might well be unprofitable for the Diamond Debtors to target the smaller ones, even if they won. It is certainly enough to present further defence and delay the liquidation for another day, as Diamond will have to fight each and every publisher, and get a final judgment that they own the consigned comics being sold.

The court's order has now been released in full. The judge has ordered that "the stay of the Sale Motion shall remain in place until and unless the Debtors both commence an adversary proceeding against each and every consignor that sold any of the goods contemplated to be sold by the Debtors in connection with the Sale Motion, and obtain a final judgment in any such adversary proceeding finding that the proposed property to be sold in connection with the Sale Motion is property of the Debtors' estates."

With the proviso, "if the Debtors and the alleged owners of any property contemplated to be sold come to a consensual agreement as to the sale of the alleged owners' respective property, nothing herein shall prevent the parties from seeking approval of any such agreement and entry of an Order permitting the proposed sale of the respective property." To date, only Image Comics has settled.

But there is plenty more to test, and the next date of hearings will be the 30th of September, unless there is some settlement before then. The Ad Hoc Committee was formed from publishers Ablaze, American Mythology Productions, Avatar Press, Battle Quest Comics, Action Lab, Drawn & Quarterly, Fantagraphics, Green Ronin, Hermes Press, Living the Line, Paizo, Udon and Zenescope.