The New York Sun reports that Marvel is suing one of its former toy contractors, claiming it was forced to spend millions to retrieve molds and tools after they ended their business relationship.
The lawsuit, filed yesterday in Manhattan Supreme Court, seeks more than $6 million from Jeffrey Hsieh of Hong Kong and two companies apparently affiliated with him. I’ll let the Sun explain the rest:
The papers say Marvel agreed to pay Mr. Hsieh’s Worldwide Toys Ltd. more than $22.7 million upon ending their business relationship to make sure Marvel could retrieve its molds and tools to keep the toys on the market.
But Marvel had difficulty retrieving the items from Mr. Hsieh’s subcontractors because they claimed Mr. Hsieh owed them money, the papers say. Marvel says it essentially had to pay for the items twice — once to Mr. Hsieh around December 2005 and then again to his creditors during the next year.
The suit claims Mr. Hsieh’s Worldwide Toys was in debt because it had fraudulently moved $9.8 million to another company, Cornerstone Overseas Investments, apparently affiliated with him.