Neil Gaiman has initiated a long-threatened lawsuit against Todd McFarlane Productions in order to establish his ownership of Miracleman and three characters created by Gaiman for McFarlane's Spawn series. The suit alleges that McFarlane has persistently violated the terms of agreements reached in 1992 and 1997.

Gaiman told the Journal that under the 1992 agreement, McFarlane was to have paid royalties for the use of Gaiman-created characters Angela, Cogliostro and Medieval Spawn. When McFarlane failed to live up to what Gaiman understood the terms of that agreement to be, the two renegotiated in 1997, according to Gaiman. The agreement that emerged from this 1997 meeting, Gaiman said, called for McFarlane to pay Gaiman all back-royalties and to turn over McFarlane's claims to Miracleman in exchange for all rights to Gaiman's Cogliostro and Medieval Spawn.

On Aug. 4, 1997, Gaiman received an accounting of royalties owed to date, as well as a payment. McFarlane also turned over to Gaiman's physical possession the film for Miracleman stories previously printed by Eclipse Comics.

According to Gaiman, the royalty payments were not continued after that date, but what brought the conflict to a head was McFarlane's announcement in 2001 that Miracleman would be revived in McFarlane's Hellspawn #13. Gaiman objected publicly that McFarlane was not the owner of Miracleman. McFarlane said he was. And the stage was set for a closely watched face-off between the two fan-favorite creators.

Gaiman has been in Europe following the filing of the suit, but stated in a press release, "This suit is not about the money, it's about respecting the rights of the creator and keeping promises." Gaiman has stated publicly that any money he might realize personally from the suit will be donated to charities.

McFarlane has been keeping an uncharacteristically low profile on the subject of Miracleman since his last public statement in a June 2001 for the Comic Book Resources website, in which he declared, "If somebody else thinks that they have control of this, then do something about it. Because I'll be right there on you, right now. Then we will solve this problem." Contacted by the Journal for this story, McFarlane declined to comment, then offered to make a statement, then declined to comment. Originally scheduled to ship August 2001, Hellspawn #13 has yet to appear, resulting in a large gap in the series schedule.

Gaiman's suit charges McFarlane and his corporate partners with nine counts:

1. Derogation of Gaiman's moral rights as a creator under the Berne Convention, United States and foreign law.

2. Infringement on Gaiman's copyright for Angela.

3. Infringement on Gaiman's copyrights for Cogliostro and Medieval Spawn.

4. Breach of contract based on McFarlane's violation of the 1997 agreement.

5. Violation of the Lanham Act by failing to attribute credit to Gaiman for his works and derivatives thereof.

6. Fraud, based on the understanding that McFarlane negotiated the 1997 agreement without intending to abide by it.

7. False advertising by deliberately confusing consumers as to the origins of Gaiman's works and attributing credit to McFarlane that should have gone to Gaiman.

8. Promissory estoppel, referring to damages to Gaiman as a result of his reliance on promises made but not kept by McFarlane.

9. Declaratory judgment, which seeks a declaration from the court that Gaiman is the proper owner of copyrights for Angela and Miracleman, as well as the text for Spawn #9 and #26 and the Angela miniseries, and that McFarlane's intended publishing plans will infringe on Gaiman's copyrights.

No monetary figure was specified for damages. The suit provides for damages and monetary awards to be determined at trial. What it asks for specifically is a declaration of Gaiman's rights with respect to the characters at issue and an order directing McFarlane to comply with the 1997 agreement. It names as defendants McFarlane, Todd McFarlane Productions, TMP International, McFarlane Worldwide and Image Comics. It does not name Diamond, HBO, New Line, or any other company that has profited from a licensing arrangement covering characters created by Gaiman for McFarlane. Gaiman's attorney, Ken F. Levin, explained that McFarlane's contracts with those companies would almost certainly specify that the responsibility for vouchsafing the accuracy of copyrights rests with McFarlane, so any payments found to be due to Gaiman would come out of McFarlane's pocket in any case. A judgment in Gaiman's favor would allow Gaiman to negotiate new deals with those licensees.

Levin said it was Hollywood's lack of knowledge about the comics industry that allowed McFarlane to cut Gaiman out of his licensing deals with studios. "I find it surprising that Mr. McFarlane was able to get both a theatrical motion picture and an animated series made without having provided evidence that he owns these rights. But I don't yet know what he may or might not have represented to them about those rights. If Hollywood would've been hip, they would have called you [the Journal] up and asked you, 'Did Todd create these characters?'"

"This is a fight that I'm glad to be in," Levin told the Journal. "I set this up as a pretty good trick bag. Either [McFarlane agreed to Gaiman's ownership of Miracleman] or that deal never happened and McFarlane owes him a lot of money [in royalties] for Cogliostro and Medieval Spawn. And on a wholly different front, he keeps republishing Neil's work, claiming it as his own, and never pays for it. That stops here."

McFarlane has 20 days from the time he is formally served with notice of the suit to respond to it. Service of the suit upon McFarlane had not been confirmed at press time, but his corporations have been served. Levin said he expects a response by the beginning of March.

(Read the rest of this report in Comics Journal #241.)