Duel of Los Angeles

"How ironic, Tony! Trying to rid the world of weapons, you gave it its best one ever! And now, I'm going to kill you with it."

- Obadiah Stane to Tony Stark

The Duel of Los Angeles was caused by Obadiah Stane, who wanted to be CEO of Stark Industries. After he was noticed as an ally to the Ten Rings, he got into his armor and started the battle against Iron Man. The name for the duel used by S.H.I.E.L.D. and the press is Incident at Stark Industries.

Background
Obadiah Stane tried to get his scientists to make a smaller version of the Arc Reactor, like Tony Stark did. However they failed, so Stane broke into Tony Stark's Mansion and temporarily paralyzed him with a Sonic Taser. Stane pulled out the power source from Stark's heart, taunting him all the while. After he departed, Stark realized that he has only one hope for survival - the preserved Arc Reactor that Pepper Potts gave him in a display case. He struggled to get the power source, but managed to get it installed in the nick of time just as James Rhodes arrived.

Potts, S.H.I.E.L.D. Agent Phil Coulson, and several other agents arrived at Stane's research lab at Stark Industries Headquarters. They spotted the Mark I Armor and a storage location where something else was kept. Just then, a gigantic robotic suit came to life and attacked them: it was Stane in his suit, code-named the Iron Monger. Stane took out the S.H.I.E.L.D. agents and chased Pepper to the parking lot.

Rhodes watched Stark suit up, awestruck at the Iron Man armor. As his friend flew away, Rhodes looked at the prototype flight suit Stark built earlier, thinking he should use it to help him. He then decided against it. J.A.R.V.I.S. warned Stark that he had only about half power in the suit; the older power source was not designed to work alongside the newer suit.

Duel
Iron Man arrived and attacked Iron Monger and the two bounced onto the highway. Stane attempted to kill Iron Man with a car full of civilians; however, Stark managed to disarm him and safely place the car down, although he was injured in the process. Stane recovered and overpowered Iron Man with his armor's superior strength in addition to his own armor quickly losing its strength.

Iron Man theorized that while Obadiah's suit is more powerful than his, it likely had the same Icing problem as the Mark II since it was reverse engineered from the Mark I. Iron Man attempted to fly as high as possible to lure Iron Monger into chasing him and reaching the altitude that would freeze the armor. His theory proved to be correct, and Iron Monger shut down mid air causing it crash into the Stark Industries Headquarters building, and Iron Man fell moments after, his battery running out of power. However Iron Monger recovered and the two fought again. Stark instructed Pepper Potts to overload the building's Arc Reactor, in order to generate a shockwave strong enough to knock out the Iron Monger's suit. Stark tried to buy Pepper sometime by damaging Iron Monger's targeting system, but in the process got himself cornered up in the roof at the mercy of his nemesis and lost the armor's helmet.

Obadiaha opened up the Iron Monger's cockpit and taunted Stark about how he created the best weapon ever as he repeatedly tried to shoot him but missed due to the targeting system malfunctioning. Stark begged Pepper to blow up the roof. Pepper hesitated, believing that Stark would also be killed, but reluctantly pushed the master button. The Arc released a powerful blast of electricity, knocking out Stane and injuring Stark. An unconscious Iron Monger then fell into the reactor which exploded, killing Stane. The energy wave from the Reactor also managed to re-charge Stark's heart battery, saving him from death.

Aftermath
"Yeah, Okay. The truth is...I am Iron Man."

- Tony Stark

Tony Stark and James Rhodes were taken to a S.H.I.E.L.D. facility where Agent Phil Coulson taught Stark how to fight when in battle.

Days later, Rhodes held a press conference about the incident. Stark was impressed with the newspaper's coming up with the name "Iron Man," and planned to adopt it despite pointing out that it's technically incorrect as the suit is not made of Iron. Agent Coulson released cover stories on Obadiah Stane and the "truth" about Iron Man, who was referred to as Stark's personal bodyguard. Pepper Potts thanked Coulson but could not remember the full name of his organization. Coulson just told them to call it S.H.I.E.L.D. and stated that they will be in touch again.

Stark went before the reporters once more, and prepared to comply with the cover story. However, before he started, Stark threw away his notes and declared "I am Iron Man."