Mile High II Collection Part IV

This is installment #4 of the story of the 1985 purchase of the Mile High II collection.

When the seller first pulled the chain on that single light bulb, and the resulting dim illumination lit up that cavernous room filled six feet deep in comic books, I was genuinely stunned. My general experience had been that most comics dealers have no clue as to what a million comics entails. Over and over again I've gone to look at collections that supposedly contain"A Million (!)" comics, only to find actually find only a small fraction of that number. In this case, however, I really was looking at well over a million comics. The problem was, however, that I couldn't access any of the individual comics. The pallets were full of unmarked boxes, and were so tightly squeezed together that it was literally impossible to enter the room without first climbing upon the pallets by the door, and then walking across the tops of the other pallets. What made this particularly disturbing was that some of the pallets were topped by comics wrapped only in brown paper. I really hated walking on the comics in my damp tennis shoes (the ground outside was covered in snow and ice), but there was no other choice.

Once I started exploring the room, I discovered that this was simply a no-way-to-lose deal. While the comics had clearly been piled on the pallets in a random manner, a full 20% off the issues I found were 12-cent cover price Marvels, most in Fine/Near Mint condition. To make sure that I wasn't being deceived by the tops of the pallets being "salted" by the seller with good stuff, I randomly picked a pallet in the middle of the room, and began burrowing down like a gopher. By stacking the boxes I examined on the tops of neighboring pallets, I gradually got down to the bottom. There I discovered an entire layer (1,500?) comprised exclusively of high grade copies of X-Men Annual #1. Even in 1985, that was a $20 book. Simple math told me that there was well over $30,000 in retail potential in that single pallet. Gleep!

When I finally stopped looking through boxes, I emerged frozen, but completely elated. Not since that momentous morning when I first looked into Edgar Church's private closet had I felt such a rush of excitement. If I could just pull it off, this deal could set me up for life! Not only did it contain a huge number of saleable books, but they exactly filled the needs of the mail order business I had built with the proceeds of the sale of the Church collection. Come hell or high water, I had to get this deal!

I returned with the seller to his home, and began discussing with him about how we might be able to work out a deal. I had no choice but to tell him that I couldn't pay his asking price of 25 cents per book, as I simply could not raise that much money. To my surprise, he said that was OK, as the best offer he had received to that point was from a consortium of Brooklyn dealers. They had offered him $85,000, which was basically 5 cents per issue. If I could top that offer, he thought he might be able to put the deal together for me.

When I explored his dealmaking ability, I discovered that the comics were not actually his to sell. They were the property of his father, who was then serving time in a New York prison (Attica?) on pornography charges. His father was being released in a couple of months, and had granted him power-of-attorney to sell the books so he would have some money when he was released. Weird. The son then rambled on about how this collection had once been much larger, but his brother had been skimming the deal for years, working as a silent partner with a guy who had a comics shop in the NY/NJ area. When the son with whom I was dealing discovered that tens of thousands of old books were missing, he had locked the remaining books in a separate warehouse from the company inventory, to keep any more from disappearing.

Removing the books from the company inventory turned out to be incredibly fortuitous for the family, as the family's book remainder company suffered a tremendous setback when the father was sent to prison. Not only did the flow of revenue that had been coming in from the pornography portion of the business immediately cease, but then, in an unrelated (?) move, three major discount retailers (K-Mart among them...) cancelled huge orders for books that they had already committed to purchase. This put the son in quite a bind, as he had already sold the supposed revenue from those three huge orders to a Factor. With no money coming in from the three orders, the son owed the Factor nearly a million dollars, and no longer had any way to sell the immense number of remainder books stored in their huge warehouse. Even if he could sell them, there was no one to load the books, as the strike by his workers had left him with only a token crew willing to help him out. I could sense that death was very near for the remainder company.

All this made the comics deal very dangerous for me. Factors are glorified (and legal) loan sharks, who are notorious for playing vicious hardball if you don't pay them. They are essential to many businesses, however, as they will purchase (at discount) the proceeds from an order in advance, thus freeing up enough cash for the seller to put the contents of the order together. In this instance, the son told me he was now paying the Factor nearly 20% interest on his loan, but that had seemed reasonable when it was simply a matter of purchasing a large quantity of remaindered books from the publishers to fill the orders from the discounters. Once the three discounters cancelled their purchase orders, however, he was left stuck with tons of books, and zero cash. He also had pledged all of his personal assets, including his house and car, to the Factor. This was a man who was in very serious trouble.

Given those circumstances, I asked the son how he could possible sell me the comics. He explained that his deal with the Factor had specifically excluded his father's comics. That seemed incredibly unlikely to me, but I went along. I also agreed that there could be a legal separation between the comics and the rest of the liabilities of the main company. They were, after all, in a different building, under supposedly different ownership. Putting this deal together, however, was going to take an incredible amount of caution.

To be continued...

Please send your e-mails to chuck@milehighcomics.com, and your letters to:

Mile High Comics, Inc.
Attn: Chuck Rozanski
2151 W. 56th Ave.
Denver, CO 80221