The ongoing litigation between Mattel (NASDAQ:MAT) and MGA Entertainment regarding the popular line of Bratz dolls took another legal turn on Monday.
In 2010, a U.S. Appeals Court overturned a lower court’s ruling that awarded Mattel ownership of the Bratz brand and $100 million in damages. Yesterday, the same appeals court grilled MGA’s lawyer over when his company knew about claims of trade secret theft, Bloomberg noted.
Following the reversal of Mattel’s previous victory, a jury ruled last year that MGA hadn’t stolen the idea for Bratz dolls from Mattel and awarded MGA $310 million in damages for trade secrets theft. Mattel appealed the award, arguing that the damages were based on allegations of trade secret theft on which the statute of limitations had expired.
MGA claimed that Mattel employees obtained proprietary information about its line of bratty-styled dolls by faking credentials to gain access to MGA showrooms at toy fairs. The court ruled in MGA’s favor, awarding it $85 million in damages and another $85 million in punitive damages. The judge then ordered Mattel to pay $137.2 million in copyright litigation legal fees for MGA.
If the Appeals Court accepts Mattel’s argument, the massive award could be overturned.
Shares of Mattel rose fractionally in Tuesday morning trading.