The first Superman character created by Jerry Siegel and Joe Shuster was not a hero, but rather a villain. Their short story "The Reign of the Superman" concerned a bald-headed villain, somewhat reminiscent of Flash Gordon's Ming the Merciless, bent on dominating the world. The story did not sell, forcing the two to reposition their character on the right side of the law.
In 1935, their Superman story was again rejected by newspaper syndicates wanting to avoid lawsuits, who recognized the character as being a slightly altered Hugo Danner, the lead character from Philip Wylie's 1930 novel Gladiator. An upstart publishing company, DC Comics printed another of their creations, Dr. Occult, who made his first appearance in New Fun Comics #6, October 1935. DC decided to take a chance with Superman, figuring if any lawsuits were filed, they would just drop the feature.
The revised Superman first appeared in Action Comics #1, June 1938. Siegel and Shuster sold the rights to the company for $130 and a contract to supply the publisher with material. The Saturday Evening Post reported in 1941 that the pair was being paid $75,000 each per year, still a fraction of DC's Superman profits. In 1946, when Siegel and Shuster sued for more money, DC fired them, prompting a legal battle that ended in 1948, when they accepted $200,000 and signed away any further claim to Superman or any character created from him.
DC soon took Siegel's and Shuster's names off the byline. Following the huge financial success of Superman in 1978 and news reports of their pauper-like existences, Warner Communications gave Siegel and Shuster lifetime pensions of $35,000 per year and health care benefits. In addition, any media production which includes the Superman character must include the credit, "Superman created by Jerry Siegel and Joe Shuster".
Throughout the first decade of Superman's existence, DC sued several competing comic book publishers for introducing superheroes with similar powers. Among these companies were Fox Feature Syndicate for its character Wonderman, and Fawcett Comics for its character Master Man. In 1941, DC filed a lawsuit against Fawcett over the top-selling character of the time whom DC perceived as a Superman clone, Captain Marvel. During the National Comics Publications v. Fawcett Publications case, Fawcett fought the lawsuit, and continued publishing Captain Marvel, who surpassed Superman and the other superheroes in sales in the mid-1940s.
By 1953, the case had been in litigation for twelve years, and in court for five. The case was decided in DC's favor. Fawcett paid DC a fine and ceased publication of all Captain Marvel-related comics. DC would acquire the rights to Captain Marvel in the 1970s and the former rival characters would be presented as allies, with Captain Marvel often serving as the Kryptonian's substitute in emergencies.