Friday, July 23, 2010

Bratz Dolls Breathe Again After Stunning Ninth Circuit Reversal; Wall Street Journal, 7/22/10

Ashby Jones, Wall Street Journal; Bratz Dolls Breathe Again After Stunning Ninth Circuit Reversal:


It’s been a while since we heard anything on the Mattel/MGA front. But the Ninth Circuit on Thursday handed down a stunning ruling, essentially reversing much of the December 2008 ruling that gave Mattel the rights to much of MGA’s Bratz products. Click here for the AP story; here for the Bloomberg story; here for the opinion, written by Judge Alex Kozinski and joined by Judges Stephen Trott and Kim Wardlaw.

The ruling may force a retrial.

In 2008, Mattel won a lawsuit claiming MGA had infringed its copyright and breached a contract because the designer of Bratz dolls was still under contract to Mattel when he developed the Bratz concept for MGA.

In April 2009, a federal judge upheld the $100 million jury verdict that gave Mattel ownership of the Bratz brand.

But the appeals court suspended that order in December and reversed it Thursday.

“It is not equitable to transfer this billion-dollar brand, the value of which is overwhelmingly the result of MGA’s legitimate efforts, because it may have started with two misappropriated names,” the appellate panel said in its ruling today.

The appellate court said it was likely that a significant portion of the jury verdict and damages award would need to be vacated and that the entire case will probably be retried.

“This is a breathtaking opinion by a unanimous panel of the Ninth Circuit. The panel endorsed all of the arguments that MGA has been advancing throughout this protracted litigation,” said Thomas Nolan, a lawyer at Skadden. Nolan led the trial team on behalf of MGA. Orrick’s Josh Rosenkrantz argued the appeal for MGA.

John Quinn and other lawyers from Quinn Emanuel handled the trial for Mattel. Daniel Collins of Munger Tolles argued the appeal.

Spokespersons for each company were not immediately reached for comment by Bloomberg."

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