Posted in: Comics, Current News | Tagged: diamond, TwoMorrows

TwoMorrows Legally Objects To Diamond Bankruptcy Liquidation Of Stock

TwoMorrows legally objects to the planned Diamond Comic Distributors, the debtors, liquidation of publishers' consignment inventory as part of bankruptcy proceedings.

John Morrow, publisher of TwoMorrows Publishing, has filed a legal objection to the plans of the debtors of the Diamond Comic Distributors Chapter 11 bankruptcy to liquidate the consignment stock owned by hundreds of publishers, to raise money to pay off Diamond's debt to the banks. And that this was to be decided by the courts on Monday of San Diego Comic-Con week, when affected publishers would be extra busy elsewhere. Stating that it is an "Objection to Debtors' entry of an order approving (i) procedures for sale or other disposition of consigned inventory, (ii) approving sales or other disposition of consigned inventory free and clear of liens, claims, interests, or encumbrances, and (iii) granting related relief", John Morrow states (emphasis mine) that;

"I am writing to lodge my formal objection to this motion. Our inventory was sent to Debtors on a consignment basis per the terms of our Supply Agreement, and is our property, not Debtor's. My company has an ongoing financial interest in selling all merchandise that is still in Debtor's warehouse."

"Likewise, unsold products that have been returned by booksellers to Debtor's inventory remain our consigned property until payment to us has been made, and I object to Debtors continuing to sell those items without remitting payment to us."

"Debtor's efforts to circumvent paying us for our property will not only jeopardize my company's immediate future financially, but their flooding the market with our products at liquidated prices will hurt our long-term ability to sell those same products from our own warehouse's inventory at normal prices. It will also undercut sales of those products at our new distributor, Lunar Distribution (where we were forced to shift our business after Debtor's bankruptcy filing)."

"Additionally, I object to the hearing being held on July 21, 2025, and would request that it be delayed until after Comic-Con International: San Diego (the comics industry's leading trade show, where I and many other publishers will be in attendance). Comic-Con will be held from July 23-27, and I will be traveling July 21-30 in conjunction with it, so would respectfully request the hearing be rescheduled for August 1 or later."

TwoMorrows Publishing was founded in 1994 by John Morrow and Pam Morrow out of their small advertising agency in Raleigh, North Carolina, to publish magazines about comic books. Titles include Alter Ego, Back Issue!, BrickJournal,  Comic Book Creator, Draw!, Jack Kirby Collector and RetroFan. They were heavily impacted by the Diamond Comic Distributors Chapter 11 bankruptcy and pulled their titles even from third party distribution by Diamond or Diamond UK. Will they be joined by other similarly affected publishers asking the same? I very well think they might.

You can use these Diamond tabs to keep up with the latest on Bleeding Cool. Here's a timeline if you want to catch up…

• On the announcement of Chapter 11 on the 14th of January, Diamond started a 13-week bankruptcy process run by financial firm Raymond James, got financing to operate, and announced an auction for its assets.
• Those assets included Diamond Comic Distribution, Alliance Gaming Distribution, Diamond Select Toys, CGA and Diamond UK
• Universal Distribution was named the Stalking Horse bidder for Alliance Games and Diamond UK, which required a purchase commitment of thirty-nine million dollars, but with certain discounts and privileges for taking that position.
• The auction took place, and it went late. There was food and breakfast billed for.
• And Alliance Entertainment, or AENT, was named the top bidder for the assets of $72,245,000, though not for Diamond UK. This was widely announced, including by Diamond themselves.
• Then we learned that a joint bid by Universal Distribution and Ad Populum came second and was named the back-up bid, with a bid of $69,130,000. With Universal getting Alliance Gaming and Diamond UK, and Ad Populum getting Diamond Comics, Diamond Select Toys and everything else. Basic Fun was third with fifty million.
•  Bruce Ogilvie, AENT chairman, was invited onto a podcast with comic book retailers Dennis Barger and Jesse James after, apparently, watching my performance on the Beyond Wednesdays podcast in which he talked about AENT and Diamond.
• A court hearing with the Honorable Judge Rice in Courtroom 9-D at the United States Bankruptcy Court for the District of Maryland at 10 am was intended to ensure the legality of the bid and the process.
• But instead, over that weekend, the debtors declared that they had chosen the back-up bid from Universal and Ad Populum instead of AENT, despite AENT having bid more. No reason was given.
• AENT filed a lawsuit regarding this decision.
• It took the bankruptcy court to reverse that decision and state that AENT, with the higher bid, had won, though they would have to withdraw their lawsuit.
• AENT has terminated their winning bid and purchase.
• Universal Distribution and Ad Populum were back in the running
• Diamond declared "business as usual" but the courts threatened Chapter 7 over late paperwork.
• AENT sued Diamond, claiming fraud
• Diamond says it's all in hand and went back to court, wanting to be owned by Universal and Ad Populum.
• Sale of Diamond to Universal and Ad Populum was approved by the courts.
• Though Ad Populum paid more than we thought.
• Podcast blamed/credited with the current state of affairs
• Diamond tells Skyrush to stop claiming they won CGA.
• As part of court filings, Diamond released details for every comic store on account.
• We have some finality.
• Ad Populum and Universal Distribution officially acquire Diamond and related assets.
• The layoffs have begun.
• And continue.
• Diamond Select Toys has closed
• Diamond try and reassure retailers over ComicSuite
• Courts withdraw Chapter 7 bankruptcy threat
• We look at the future of Diamond Previews again
• PRH pulls out of Diamond entirely
• Well, not entirely, the UK can stay.
• Hermes Press says Diamond doesn't want to distribute their comics anymore… or anyone's.
• But Diamond pushes back on that, as they publish a new Previews.
• And they assure comic book stores that everything is going to be fine. Honest.
• Then send a letter to publishers which looks like it isn't
• Now they are looking for more money and longer to pay it back.
• Dynamite would like half a million now, please.
• Udon and Manga Classic have now cancelled all Diamond orders.
• Then so did Drem Productions
• And PRH starts to close their special retailer joining offer
• Diamond gets a fourth wave of funding and deadlines.
• Philbo Distribution launches.
• Alliance Entertainment hire seven senior Diamond staffers.
• Universal Distribution rumoured to be hiring Diamond staffers to enter the US market.
• Massive Distribution expands within Lunar
• Diamond has cancelled all their PRH orders.
• There are problems with Ad Populum's first payments to comics publishers
• Ad Populum sues AENT alleging breaches of confidentiality and staff poaching.
• Ad Populum still ghosting publishers.
• Bankruptcy timeline revealed it began in July 2024
• Diamond ends cash on delivery sales
• Hermes Press hires Steve Leaf
• Diamond responds to Dynamite
• Diamond closes No Cost Orders, sends out reminder emails to comic book stores
• Boom Studios makes layoffs.
• Zenescope pulls out of Diamond.
• AENT Says Diamond Claim They Poached Staff "Fails As A Matter Of Law"
• It's Claimed New Diamond Owner Said He's "Playing Chicken With Idiots"
• Mike Schimmel Talks, Under Oath, About The Diamond Comics Firings
• Dynamite jumps to Lunar Distribution
• Diamond takes Previews digital only
• Universal Distribution to distribute in the USA as well as Canada, starting with DC Comics
• Conflicting Statements Over Diamond, AENT And Ad Populum Lawsuits
• This Week, There Are Only Five Comics On Diamond's FOC
• Robert Gorin, Chief Restructuring Officer Of Diamond Comics, And Geek
• Titan Has Not Received Payments From Diamond Comics, Stops Supplying
• Fantagraphics Says That Diamond Is Holding Their Comics Hostage
• Kathy Govier, Chief Marketing & Communications Officer, Out At Diamond
• Confirmed, AENT Tried To Buy Diamond In October To Avoid Bankruptcy
• Dynamite Pulls Their Comics Out From Diamond Comic Distributors
• Diamond Moves To Liquidate All Consigned Comics "Held Hostage"
• FairSquare Graphics Calls Diamond "Thieves & Bandits", Brings Receipts
• Ultimate Comics Chain Refuses To Buy Diamond Liquidation Stock
• This One Trick Means Bandai Get Their Pokémon Cards Back From Diamond?
• Dren Productions Want To Know If Diamond Shipped Their Recent Comics?
• Publishers Have 3 Weeks To Object To Diamond Comics' Liquidation Plans
• Emily Botica, Vice President At Diamond Comics, Is Leaving Next Week
• SDCC Gossip: What's Happening With Diamond At San Diego Comic-Con?
• Universal To Offer DC Comics To US Retailers At Same Lunar Discount
• Comic Publishers To File Paperwork Against Diamond Comics This Week
• Diamond Pulls Its Pullbox And Cancels Its ComicSuite For Comic Shops
• The Exit Interviews Of Diamond Comic Distributor Staff In Full
• Andrew Aiello, Tom Derby & Ben Davis Buy CGA After Diamond Bankruptcy
• Dynamite Owed A Million By Diamond, Can't Make Payroll Next Week
• Ad Populum Can't Yet Deal Directly with Diamond Consignment Vendors
• As Court Denies Dynamite Over Diamond, Comic Creators Rally Round
• Paizo speaks out about their Diamond troubles

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