August 22, 2011 8:44am PT by Eriq Gardner
'Conan the Barbarian' Lawsuit Seeks Character Rights (Exclusive)
If anybody thought that Stan Lee Media Inc., the company which now operates independently from its comic book legend founder, was gone for good, guess again. On Friday, SLMI made a big move in U.S. District Court in California to grab back rights on the fictional character Conan the Barbarian and win proceeds from the just-released Conan the Barbarian 3D film.
The new suit comes from SLMI, which has had a rocky history since being founded by Stan Lee in the late 1990s.
Initially, the company looked to be on its way towards success after Lee assigned SLMI rights to his famous comic book characters. In 2000, the company added to its stable of rights by acquiring full ownership of Conan Properties. Then, the following year, SLMI entered bankruptcy, and the company's IP assets were diverted, leading to a decade of protracted litigation.
Last year, SLMI found its feet again after a Colorado court recognized SLMI's new board as the duly authorized representative of the company. Since then, the company has been looking to put back the pieces.
SLMI's latest splash is a lawsuit filed on the same day that the latest Conan the Barbarian film hit theaters.
According to the complaint, after SLMI went into bankruptcy in 2001, an unauthorized agent of the company purported to transfer its ownership of Conan Properties back to Conan Sales Co.
The company claims that the transfer of the "Conan" character is void because at that time in 2002, "the shares of Conan Properties and all other assets of SLMI were part of a bankruptcy estate and protected from unauthorized transfer by the automatic bankruptcy stay."
SLMI says that the defendants obtained relief from the automatic stay in March 2002 by getting a judge to sign off on a "Settlement Approval Order" but that this order was itself void because the defendants didn't provide notice and give 1,800 SLMI shareholders an opportunity to protect their interests by opposing the motion to transfer Conan.
The transfers, allegedly made by attorney Arthur Lieberman among others, is alleged to have constituted fraud and a breach of fiduciary duties. Lieberman himself is a defendant in this lawsuit.
In 2002, after Conan Sales Co. reacquired rights to Conan, it sold those rights to a Swedish company called Paradox Entertainment, which has spent the last decade attempting to revive the character's commercial value, including new comic books, a computer game, and now a 3D film from Nu Image/Millennium and Lionsgate.
In its lawsuit against Conan Sales Co., Paradox, Lieberman, and others, SLMI is demanding it be restored its rights over the franchise and that the defendants be ordered to turn over any money or property derived from the success of the character, including the newest film. Conan disappointed at the box office this weekend, bringing in about $10 million. Reports have pegged the budget as being anywhere from $70 million to $90 million.
Paradox couldn't be reached for comment.
Meanwhile, SLMI continues to wage war against Stan Lee and Marvel Entertainment over rights to Spider-Man, the Incredible Hulk, X-Men, Iron Man, the Fantastic Four, Thor, and more. Similarly, the company believes that this IP was unlawfully transfered when the company was in bankruptcy protection. A California federal judge recently stayed proceedings, awaiting a ruling by the 2nd Circuit whether an alternative lawsuit in New York can be pursued once again.
Conan the Barbarian was created by Robert E. Howard in the 1930s, revived as a comic book character by Marvel Comics in the 1970s, and became a film starring Arnold Schwarzenegger in 1982.