No it's not an acrimonious custody dispute between parents – but the long-running battle between toy behemoth Mattel and rival MGA Entertainment over the successful Bratz fashion dolls has culminated in a decisive victory for MGA.
The story so far
The idea for the Bratz range of fashion dolls originally came from Carter Bryant, a former Mattel employee. When MGA released the dolls in 2001, the Bratz "Girls with a passion for Fashion!" quickly gained market share previously dominated by Mattel's Barbie. Claiming that it owned the copyright and ideas in the dolls created by its former employee, Mattel sued MGA for copyright infringement.
At the initial trial in 2008, a jury awarded Mattel US$100 million in damages, and MGA was ordered to stop making and selling Bratz products, and to transfer the brand to Mattel. However the US Court of Appeals for the Ninth Circuit reversed the verdict and ordered a retrial (our previous post on this entertaining appeal decision can be found here).
Which brings us to the current proceedings. At the retrial, an eight-person jury heard juicy accusations from both companies that the other side had stolen trade secrets (including that Mattel had distributed an internal "how to steal" manual), as well as the original copyright infringement claims.
The jury unanimously rejected Mattel's copyright claims and absolved MGA of any wrongdoing in relation to the stealing of trade secrets from Mattel. Instead, it found Mattel was responsible for stealing trade secrets from MGA in relation to unreleased product information, and awarded MGA US$88.5 million in compensation. The trade secrets were stolen when Mattel sent its employees, armed with fake business cards as identification, to access private MGA showrooms at industry trade shows. The showrooms were only intended to be accessed by retailers who agreed not to divulge what they saw, not competitors. The jury didn't side with MGA on every count however - but Mattel is unlikely to find much solace in the US$10,000 it was awarded on the claim that MGA and its chief executive had interfered with Mattel’s contractual relations with Carter Bryant.
Mattel lawyers are said to be seeking a retrial. On the other side, MGA attorneys will appear in court ater this month to request that the court use its discretion to multiply the damages award by up to three times the amount awarded by the jury. In the meantime, Bratz aficionados (including my five year old niece!) can rest easy in the knowledge that the Bratz brand is once again safely back in the hands of its creators.