MARTIN GARBUS EATON & VAN WINKLE LLP (Admitted Pro Hac Vice) 3 Park Avenue, 16th Floor New York, New York 10016 qelenhone! (212) 561-3625 Fax: (212) 779-9928 Attorneys for Defendants CHRISTOPHER BELLAND and JOHN PETROVITZ UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA. QED PRODUCTIONS, LLC, a | CASE NO. CV 07-00225 SVW (SSx) Delaware limited liability company; | [Related Case No. CV 07-4438 SVW POW! ENTERTAINMENT, INC.,a | (SSx)] Delaware corporation; STAN LEE, an individual, Plaintiffs, DEFENDANTS’ STATUS REPORT JAMES NESFIELD, an individual; et al, Defendants. STAN LEE MEDIA, INC., a Colorado Corporation, Plaintiff, v. STAN LEE, an individual, et al., Defendants.Sec wmrIr AH RYne PRR NYKNHNNRNRERE Se ee eee BRRRBRERBRESVSRSWIABDEBSHE Defendants John Petrovitz. and Christopher Belland (“Defendants”) hereby submit the following status report to the Court regarding an action recently filed and “low numbered” to this Court titled Jose Abadin v. Stan Lee, Case No. CV 09- 2340 SVW. In an Order dated January 20, 2009, this Court denied Plaintiffs’ motion for summary judgment and finding that “Plaintiff QED did not acquire an interest in the Properties by virtue of a transfer from the bankruptcy court because any such transfer was done in violation of the automatic stay, and was therefore void as a matter of law.” (1/20/2009 Order at p.14:6-17) This Court went on to rule that there remained additional factual issues relating to whether Plaintiff QED owned the Properties at issue by virtue of Mr. Stan Lee terminating an October 15, 1998 Employment Agreement shortly before the bankruptcy filing of Stan Lee Media, Inc., a Colorado Corporation (“SLMI-CO”). (See 1/20/2009 Order at pp.12:18- 13:5) ‘After making this finding, this Court noted that there was no one that could “speak on behalf” of SLMI-CO. ‘Thus, this Court stayed these related actions because the resolution of the remaining factual issues required such a person or entity. (Jd. at 12:16; Order dated January 27, 2009) ‘The instant status report is to advise this Court that, as of the present, there is still no one qualified to speak on SLMI-CO’s behalf because the company has neither a board nor officers. An attempt failed in Colorado to constitute a quorum to elect a board to, among other things, authorize SLMI-CO to proceed with the related actions. The delay in electing a board is preventing the resolution of the critical question of the ownership of many properties that — the shareholders contend — should be found to belong to SLMI-CO. Indeed, my office brought a shareholder’s derivative action in the Southern District of New York (Case No. 09 Civ. 0715 (PAC)), to address the issues of theFS ear ,HeRwoHHE 13 14 15 16 7 18 19 20 21 22 23 24 25 26 27 28 ownership of the properties. That action is currently stayed for reasons similar to those set forth by this Court in its 1/20/09 and 1/27/09 Orders. Because this Court has already resolved a critical issue in this dispute, many of SLMI-CO’s shareholders believe that a shareholders suit should be brought in the Central District of California to litigate the remaining factual issues until such time as a board may be constituted that would allow SLMI-CO to conduct the litigation directly on its own behalf. As referenced above, such an action has been filed (Jose Abadin v. Stan Lee, Case No. CV 09-2340 SVW), and has been already assigned to this Court. Dated: April 8, 2009 EATON & VAN WINKLE LLP MARTIN GARBUS 4 Martin Garbus, Esq. Attorneys for Defendants Belland and Petrovitz