Stan Lee is suing the entertainment company he co-founded for $1bn (£742m), according to legal documents.
The comic book legend alleges he was coerced into a fraudulent sales agreement when he was in an emotionally and physically fragile state.
The complaint, filed in LA on Tuesday, claims Pow! Entertainment made Lee, 95, sign over his name and image rights.
Pow! later issued a statement insisting that Lee had “clearly understood” the terms of the agreement.
“The allegations are completely without merit,” a company representative told the Hollywood Reporter.
“In particular, the notion that Mr Lee did not knowingly grant Pow! exclusive rights to his creative works or his identity is so preposterous that we have to wonder whether Mr Lee is personally behind this lawsuit.”
It added: “The evidence, which includes Mr Lee’s subsequent statements and conduct, is overwhelming and we look forward to presenting it in court.”
Pow!’s parent company, Hong Kong-based Camsing International Holding, said it was seeking legal advice.
Pow! Entertainment has previously expressed “concern” over Lee’s wellbeing.
Lee is the co-creative force behind many superhero characters, including Black Panther and Spider-Man.
The lawsuit alleges Pow! chief executive Shane Duffy and co-founder Gill Champion “conspired and agreed to broker a sham deal to sell Pow! to a company in China and fraudulently steal Stan Lee’s identity, name, image, and likeness as part of a nefarious scheme to benefit financially at Lee’s expense”.
The complaint, lodged at Los Angeles County Superior Court, states Lee does not recall signing sale documents, nor having them read to him.
The suit draws attention to the death of Lee’s wife last July, and his degenerative eye condition which has caused his poor eyesight, suggesting he could not have read the documents.
The legal papers also say Pow! took control of Lee’s personal social media accounts. He appeared to regain control of his Twitter account on Tuesday and used the platform to tell fans his social media channels had been “hijacked”.
“From now on, I will depend on you, my dear fans, to protect and defend me,” he added.
The comic book writer went on to post his first Twitter video – with the help of fans – to express further gratitude.
“I just want to tell you I love your comments on Twitter – I don’t know how much I have been missing now that I see them,” he said.
“I appreciate everything you say and do, I love you all – let’s keep up the great relationship”.
The nonagenarian signed off with his signature phrase “excelsior!” – implying triumph.