Excelsior No More

Hulk vs. Thing. The Fantastic Four vs. Doctor Doom. Spidey vs. Doc Ock. The X-Men vs. Magneto's Brotherhood of Evil Mutants. And now Stan Lee vs. Motley Fool Stock Advisor recommendation Marvel (NYSE: MVL  ) ? Has it really come to this? In a press release issued yesterday, lawyers for iconic comic pioneer Lee, the co-creator of Spider-Man, the X-Men, and the Fantastic Four, which will be the subject of a motion picture this summer, proclaimed victory in a long-standing lawsuit against his former employer.

The suit centered on an agreement in which Lee was to be granted 10% of the profits from Marvel characters he created. That was to include films. But, according to the release, Marvel said that it made no profits from films such as Spider-Man and Spider-Man 2, both produced by Sony (NYSE: SNE  ) . That's bunk. So, not surprisingly, the judge in the case ordered a summary judgment in favor of Lee.

Yet it's also not likely to be a big deal for the company financially. Marvel has set aside roughly $5 million in legal reserves already. And, according to the press release announcing the win, Marvel must pay Lee "10% of any profit participation or benefit it receives from movies, television, or other ancillary uses of Mr. Lee's characters, including certain merchandising." That might sound huge when you consider the first Spider-Man movie grossed more than $800 million. But that's misreading the story. The key word here is profit. Marvel has earned $180 million over the last three fiscal years combined, and has reported $108 million in profit over the trailing 12 months. Though it's impossible to calculate a completely accurate number, rumors of $50 million payouts swinging around the Web are alarmist, at best.

What's really troubling is that Marvel has mistreated one of the guys who -- to borrow a political phrase -- brung 'em to the big dance. Known for his colorful sign-off "Excelsior!" in the letters pages of Marvel's comics and in on-screen appearances, Lee has been the face of Marvel since as long as I can remember. He even did his own take on Alfred Hitchcock, appearing briefly in recent Marvel films. Fortunately, the lawsuit doesn't seem to have chilled relations enough for these gimmicks to end.

But let's also remember that Lee is hardly the sole creative genius at Marvel. Take the X-Men movies. The plots of both films and the characters within owe as much to Chris Claremont, John Byrne, and dozens of others who crafted the "new" X-Men between the late '70s and early '80s as they do to Lee. Even Elektra, in theaters now, owes more to Frank Miller than Lee. (By the way, if you want to see some of Miller's best work brought to the screen, try Sin City, originally published by Dark Horse Comics and to be released by Miramax in April. The trailer is here.)

Still, I can't get past the feeling that Marvel's aggressive legal team has gone too far. Or maybe that's just my irony sense tingling. After all, aren't Marvel's worst villains -- many of whom were created by Lee -- each possessed of a massive ego? So much so that, in the end, their overconfidence accelerates their ultimate downfall? It's highly unlikely that Marvel Enterprises' spectacular hubris in this sordid affair will force it to the same dismal fate. But it sure can't help, either.

For related Foolishness:

We interviewed Marvel Vice Chairman Peter Cuneo on The Motley Fool Radio Show on NPR earlier this week. Tune in this weekend to hear his thoughts on Elektra and more. Find the station in your area throughNPR's Fool Radio website.

What Marvel team-up would make the best movie? Captain America and Iron Man? Blade and Dr. Strange? The Fantastic Four and the X-Men? Do you care? Will Marvel keep it together long enough for such a project to come to life? Debate all this and more at the Marvel Enterprises discussion board. Only at Fool.com.

Fool contributor Tim Beyers owns thousands of comic books, some of which he's considering selling on eBay. Tim held no ownership interest in any of the companies mentioned in this story at the time of publication. You can find out what stocks Tim owns by checking his Fool profile, which is here. The Motley Fool has a disclosure policy.


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