The amount of publishers’ consignment inventory that Diamond Comic Distributors is holding and attempting to seize and sell is nearly $50 million, one of several revelatory numbers in a January 27 filing in the Diamond Comic Distributors bankruptcy. In the filing, Diamond declared that it holds $47,395,014 at book value in consignment inventory ($113,737,037 at retail), an amount that makes it clear why the publishers are crying foul at high volume at Diamond’s attempt to appropriate it.
The dispute over Diamond’s attempt to seize the inventory was being litigated and the parties had been negotiating with the help of a mediator (see “Mediation”), but the issue had not been resolved when the bankruptcy was converted from a Chapter 11 reorganization to a Chapter 7 liquidation in December (see “Court Orders Chapter 7”).
Diamond had worked down the obligations incurred during the Chapter 11 period before the conversion, although the amounts owed still totaled $2,899,302, according to the new filing. That was down substantially from the over $10 million owed at the end of November. Of that amount, $993,314 was owed to Alliance Game Distributors creditors and $1,656,086 was owed to Diamond Comic Distributors creditors (the rest was owed for interest and storage).
Diamond also detailed over $13 million it was owed by affiliates, some involved directly in the bankruptcy and others that didn’t file. The largest amount was owed by Diamond Select Toys, which had a $7,548,878 debt to Diamond Comic Distributors. According to recent filings, Diamond Select Toys has no assets, so that debt now appears to be worthless.
Diamond was also owed $3,698,722 by Diamond International Galleries, which was not part of the filing. Diamond International Galleries managed an auction business (see ‘Geppi Buys Auction House”), and a gallery where portions of Diamond owner Steve Geppi’s personal collection was displayed until the opening of Geppi’s Entertainment Museum in the mid-00s (see “Geppi Plans Museum”). The museum was closed in 2018 (see “Closing Museum”). Diamond International Galleries was still getting cash from Diamond Comic Distributors in 2024: a filling disclosed $433,000 in “advances, not repaid” to the affiliated company in the year prior to the Chapter 11 filing. It’s not clear whether the Galleries company has any assets or has any hope of repaying the amount owed.
The next largest amount due from an affiliated company was $1,745,256 due from Rosebud, the publisher of Baltimore Magazine. The publisher is currently in business.
Remaining amounts due were $494,250 from Gemstone Publishing, which publishes the Overstreet Price Guide, $186,140 from Steve Geppi personally, $68,998 from Renegade Games (which does not appear to be the same as game publisher Renegade Game Studios), and $26,163 from E. Gerber Products.
Diamond had only $310,689 in cash at the time of filing, some of which was “collected from customers for the account of Universal Distribution and Sparkle Pop” (i.e., not Diamond’s money).
Until the final monthly operating report is filed, we won’t know what other assets, if any, Diamond has to go toward its debts. There have been relatively small amounts ($244,150 in November, the most recent amount disclosed) coming in from sales of assets, so there was still some cash flowing from the sale of assets as of November. But it’s a heavy lift to cover Diamond’s debts, which include $38.8 million in debt at the time of the Chapter 11 filing early in 2025 in addition to the $2.9 million in Chapter 11 debt. The bankrupt estate also has to cover expenses of the bankruptcy trustee and his staff.
The key issue remains what happens to the consignment inventory, which does not appear to be an issue that’s any closer to resolution.
Source: ICv2
