Well-known San Francisco comic retailer Brian Hibbs (Comix Experience) has initiated a class action lawsuit against Marvel Enterprises, Inc. and Marvel Entertainment Group, Inc. in the Supreme Court of New York County, New York. The suit asks for $8 million in compensation for damages and $10 million in punitive damages. The alleged damages occurred, according to the suit, because Marvel's trade terms specify that it will make late books and books that change content returnable from retailers buying through Diamond Comic Distributors, Inc., and it did not. A class action suit is one in which there are potentially many plaintiffs (all the stores that bought Marvels from Diamond) that could join the suit, each for a small share of the total damages.
Hibbs provided a spreadsheet with a list of books, their estimated orders from Diamond (taken from ICv2), and the total dollars involved, that totaled $6.3 million at retail. According to Nancy Ledy-Gurren, attorney for Hibbs and other plaintiffs, the difference between the approximately $3 million in wholesale the list represented and the $8 million in damages sought is because more titles will be added when documents have been analyzed (for example, no content change books were included in Hibbs' spreadsheet), and because consequential damages are also included. Ledy-Gurren did acknowledge that the amount of damages was based on the full value of the books, not just on what retailers might have returned.
The punitive damages are requested as part of an allegation of fraud. We asked Ledy-Gurren what evidence they had that Marvel had engaged in fraud. 'Since it happened continually over a period of time and had been preceded and postdated by returns, the inference that it was deliberately done is there,' she responded.
Marvel's hotly debated no-overprint policy even makes an appearance in the complaint, which says that the policy, '...encourages resellers and retailers to 'over-order' Marvel Comics or face shortages of product for their consumers.'
We asked Hibbs whether he'd contacted Marvel directly, or just made his requests for returns through Diamond. He described a lengthy chain of events, including, 'a letter to Jemas that was roundly ignored,' at least ten conversations with then Marvel employee Fletcher Chu-Fong, calls to Steve Geppi (owner) and Chuck Parker (COO) of Diamond, conversations and e-mails with Diamond Marvel rep Jim Kuhoric, and a series of broken commitments (made through Kuhoric) to announce a policy for accepting returns on the disputed books.
Marvel's schedule problems have been well-documented (see 'Marvel Gains in Schedule Struggles' and 'Marvel Strives To Get Back on Schedule'). We had also heard from at least one other retailer that there is a long list of Marvel books that should have been returnable under its trade terms that weren't.
Marvel did not respond to a request for comment by our deadline for this story.
A comment by Ledy-Gurren (in request for info on other class action cases in which she's been involved) may give some explanation for the relative availability of the two sides in this litigation. 'Having done many cases on the defense side as well,' she said, 'I know that defendants in these cases don't like publicity.'