Expansion
In 1935, writer/entrepreneur Malcolm Wheeler-Nicholson approached Independent News in a bid to launch his comic book New Fun, having lost his previous backers due to poor sales and debts. Donenfeld accepted to distribute the comic but with a heavy loss of rights for Wheeler-Nicholson. Wheeler-Nicholson produced two more titles to be handled by Independent News, New Comics and Detective Comics (which would later see the first appearance of Batman), now under the banner of Detective Comics Inc., in which Wheeler-Nicholson was forced to take Donenfeld and Liebowitz as partners. In 1938, Donenfeld sued Wheeler-Nicholson for nonpayment and Detective Comics Inc. went into bankruptcy. Not too surprisingly, Donenfeld bought up the company and Wheeler-Nicholson's National Allied Publications in their entirety as part of the action.[8]
The fourth publication under National Allied Publications would be Action Comics (1938). Issue #1 introduced the superhero, Superman, created by artist Joe Shuster and writer Jerry Siegel, and the character's popularity created incredible profits; not only in comic book sales, but also in merchandising such as toys, costumes and even a radio show. At the end of 1941 Donenfeld's comic businesses took in $2.6 million.[9]
Max Gaines, future founder of EC Comics, formed All-American Publications in 1938 after successfully seeking funding from Harry Donenfeld.,[10] As Gerard Jones writes of Donenfeld's investment: "Harry had agreed on one condition: that [Gaines] take [Detective Comics partner] Jack Liebowitz on as his partner. ... Jack would be tempted to leave and form a competing company if there was nothing to hold him. And it may well have been a way for Harry to keep Gaines under control; since Jack was still drawing a salary and significant bonuses from Detective Comics and [self-distributorship] Independent News, he wouldn't let Gaines take off on his own or act against the interests of the other companies. ... Gaines became the principal and Jack Liebowitz the minority owner of All-American [Publications].[11]"
In 1946, Gaines let Liebowitz buy him out, keeping only Picture Stories from the Bible as the foundation of his own new company, EC Comics. "Liebowitz promptly orchestrated the merger of All-American and Detective Comics into National Comics.... Next he took charge of organizing National Comics, Independent News, and their affiliated firms into a single corporate entity, National Periodical Publications".[12] Donnenfeld was also a minority owner in the pulp magazine distributor Leader News Company, which lasted from 1939 until 1956. During that time, the company distributed magazines by Trojan, as well as EC Comics.[13]
