ULTIMATE FALLOUT ACETATEGATE

The revenue from comic and graphic novel sales in North America reached 2.075 billion U.S. dollars in 2021, up significantly from the 1.28 billion U.S. dollars in 2020.

Such a lucrative industry opens the door for deception, fraud, insider trading and collusion.

For comic book collectors and investors, market speculation is the driving force of comic sales.
But there are two institutions that stand to gain the most from increasing prices, grading companies and auction houses.

The top entities of these two institutions are the CGC grading company and Heritage Auctions, respectively.

CGC is a business that inspects collectables (in this case comic books), certifies them, and assigns them a rating of quality before encapsulating them in a clear plastic slab. CGC offers a tier system when it comes to slabbing comic books. The higher the value of the book, the higher the service charge.

Heritage Auctions charges a 20% buyers premium. So if an auction sells for $1 million, heritage pockets $200,000. Heritage charges a 5% fee to the seller as well.

Here are some concepts to familiarize yourself with to better understand the following context.

CGC LABELS:

For collectors and resellers, the most sought after and subsequently higher valued labels are the yellow signature series (verified signed books) and the blue universal grade (the book is not altered or modified in any way). The green qualified grade (altered/modified) and purple restored grade (replacement of rusty staples/color touch up) fetch a significantly lower price tag in the resell market.

COMIC GRADES:

Pretty straightforward. The closer the comic grade is to 10, the higher the value. 9.9 and 10.0 books are exceedingly rare to come by. The average collector is happy enough to receive a 9.8 rating.

Nestled within this controversy is a comic book retailer known as Black Flag Comics and the comic book Ultimate Fallout #4.

UF4 is touted as a modern era key comic for it's 1st appearance of Miles Morales aka black Spiderman, which was originally released in 2011.


In August of 2021, Black Flag Comics partnered with artist Clayton Crain to produce a retailer exclusive facsimile variant of Ultimate Fallout #4.


A comic book store can get an exclusive-to-them retailer cover of a comic book being published by Marvel or DC, by ordering a minimum of 3,000 copies. They pay the full wholesale price, plus artist costs, and they can be sold for a premium or used for promotional purposes. The issue for Black Flag however, was their inability to push all 3,000 copies.

At a recent comic convention known as C2E2, Black Flag Comics released this variant with an "Acetate Cover," essentially a plastic, transparent cover with patriotic overtones.



Not only is there spelling errors with the, "In God We Intrust," the American flag is wrong with the white stripes on top and bottom, the folded flag shows the stripes underneath.

They only made 750 copies, and this time it did not go through Marvel - they essentially took their unsold stock and stapled the transparent cover on top of it.

There's two main parts to the C2E2 controversy.
The first is that Black Flag let "influencers," and other high profile comic media people buy these bootlegs in bulk ahead of time.
When normal buyers in line got their chance, there was only a box of about 100 copies left and Black Flag increased the price from $85 initially to over $100 and limited them to two per customer after the influencers/etc. had their full go at them.

The second is that several of these covers got sent to CGC from Black Flag for grading and came back with not only 9.8s, multiple 9.9s, and a near impossible perfect 10.0, but they did so with the CGC Blue Label, which indicates the book is not altered or modified in any way. Luckily for us, CGC offers a census to track the numbers of their graded books.



Even if these books somehow managed to be clean and well made enough to justify those grades, there's a strong belief these books should have warranted a Green Label, or maybe even a Purple Label.

The whole thing not only called into question the ethics and policies at CGC, but also shone a light on artificial comic book demand and underhanded tactics by overselling to personalities who hype up a book, raising the price/value, and are then in a position to benefit heavily from that increased value at the expense of general readers.

When confronted, CGC doubled down on their stance of grading the comic with a blue label:

"We feel it is important to provide transparency on how CGC arrived at our method of certifying Clayton Crain's Ultimate Fallout comics with the attached acetate covers. For us, this was an unprecedented item to grade. After Mr. Crain spoke with us prior to C2E2, the rules we applied to his books:

The additional cover had to be created by an established artist in the industry.
The comic to which the cover was attached had to contain a cover by that same artist.
A copy of the comic with the attached cover had to be submitted to us for inspection prior to certifying any copies.
Given the recent circumstances, we have made adjustments to the labeling originally used for the Ultimate Fallout exhibiting the acetate cover. Going forward, any copies submitted to CGC will display in the label text: "In God We Intrust" Acetate Artist Cover attached with 2 staples after manufacturing. The books will still be allowed to receive a Universal label.

This will also apply to Mr. Crain's forthcoming copies of Ghost Rider #1 and Deadpool Nerdy 30 #1 that contain an acetate cover."

Note the inclusion of the forthcoming Ghost Rider #1 (Zymotica Vs.) and Deadpool Nerdy 30 #1 (99 problems) acetates because when you enter these variants into the CGC census some astronomical odds are made apparent.



10 copies of Ultimate Fallout #4 Acetate were graded. 5 copies at 9.8, 4 copies at 9.9 and 1 perfect 10.
9 copies of Ghost Rider #1 Acetate were graded. 5 copies at 9.8, 3 copies at 9.9 and 1 perfect 10.
10 copies of Deadpool Nerdy 30 Acetate were graded. 6 copies at 9.8, 3 copies at 9.9 and 1 perfect 10.

If you obtained a stack of 100 comics hot off the presses in as good of condition as possible, I'd be willing to bet money that if you sent them in for grading, they'd all come back 9.8. or lower. To send in 10 copies each of books that have been sitting on the shelves for months and then have them stapled to come back with consistent result, looks suspicious. If you examine the census, The Big Time Collectables variant of Ghost Rider#1 has over 100 books sent in for grading and not 1 book came back higher than a 9.8.

Black Flag had intentions to sell the acetate variants of Ghost Rider and Deadpool at the following convention, FAN Expo Boston. But before the event, Marvel issued a statement and most likely a cease and desist order. bleedingcool.com...

People going to FAN Expo Boston were treated to a strange sight at the Black Flag Comics booth. The banners were up, but the tables were bare, with just some suckers (lollipops) for people to take. Black Flag Comics stopped updating their social media and their name was also dropped from the Boston Fan Expo exhibitor list.

Now, this isn’t the first time CGC has been criticized with graded acetate comics.

In late 2021, comic publisher Bad Idea released the first ever invisible comic book and sent every issue to CGC for grading. Bad Idea’s business model includes gimmick books and initial low print runs of their comics, to portray scarcity, artificially boosting their value.

The invisible comic in question, Conceptual Funnies #1 was issued at least 1 book in every possible grade, except a 1.8.



Seeing this stunt as potentially harmful to their brand, CGC requested that Bad Idea stop selling the slabbed invisible comics.

bleedingcool.com...

How does Heritage Auctions play its role in all of this? Enter Jim Halperin, Co-Founder and Co-Chairman of Heritage Auctions.

This Youtube video explains the same manipulation of the retro video game market with the same players involved. I suggest you watch the entire video when you have the time but here is a highlight in regards to the practices of Jim Halperlin.

www.youtube.com...

Timestamp 24:14 - 27:10

The video displays the manipulative practices of the video game equivalent of CGC, Wata Games, who is currently defending itself in a lawsuit that alleges the company artificially inflated the price of the retro gaming market, and lied to customers. It is interesting to note that a Co-founder of Wata Games is Mark Haspel. Mark Haspel is a former President and Primary Grader of CGC.

The final thread of this conspiracy regards the new owners of CGC. In mid 2021, CGC as a company was valued at more than $500 million by the investment firm known as Blackstone. Blackstone acquired a majority stake in CGC’s parent company CCG, additional investors in the transaction included Jay-Z’s company, Roc Nation.

Blackstone held the mortgage to Tower 7 during the September 11th attacks and up until 1994, owned a considerable stake of Blackrock.

Either intentionally manipulating the comic book market or not, these practices do not portray the image of CGC, Black Flag Comics and the involved influencers in a good light and hurts the industry as a whole.

Thank you for reading.

a reply to: CloneFarm1000

Karl Jobst, is thst you?

a reply to: Brotherman

lol.

The research that Karl Jobst provided in his videos in regards to Wata Games, coupled with the recent controversy in the comic book industry inspired me to make this thread.

I'm a comic book collector and now knowing what I know, I'm switching from doing business with CGC to their competitor CBCS.

CBCS doesn't require a witness to verify signatures, since they're partnered with Beckett for signature verification.

I'm also going to avoid buying store exclusive variants from now on, unless it's from specific artists I like and I enjoy the artwork.

All these variants and practices from retailers like Black Flag, publishers like Bad Idea and influencers put the comic book industry in dangerous proximity to the comic crash of the 1990's