Intellectual Property Law

Mattel Inc, the creators of the Barbie doll enterprise and the world's largest toy maker, has won its copyright infringement claim against MGA Entertainment Inc, the marketers of the Bratz line of dolls since 2001. CNN has reported the ruling today, which could potentially net Mattel a windfall when damages are decided separately by a jury. See  http://edition.cnn.com/2008/BUSINESS/07/18/barbie.bratz.ap/index.html

Mattel brought its infringement claim against MGA in a US District Court when it had gathered sufficient evidence that the Bratz dolls concept was coined by a former employee when he was working for Mattel. That employee had left Mattel in or around 2000 for MGA. Shortly after his move, MGA had started marketing the Bratz doll and soon created a Bratz empire worth over ??500 million dollars a year.

MGA had argued that the employee had created the concept during a period of time when he was not working for Mattel. However, this argument fell by way side and Mattel convinced a federal jury that the employee conceived the Bratz idea whilst in its employ.

Since the arrival and success of the Bratz empire, Barbie merchandise had suffered a noticeable slide in sales. Following this huge result in favour of Mattel, that slide will eventually be corrected unless MGA are successful in any appeal.

This case is yet another example of a company moving full steam head in bringing a product to market without taking great care to ensure that its new designer isn't using confidential information belonging to his previous employer in his new role. If that company goes on to achieve tremendous success with the product, its fall from grace is dramatic when the real creator comes forward to claim what rightfully belongs to it.

We have noted a marked increase in breach of confidentiality cases over the last few months.This seems to tie in with the difficult trading conditions. In some instances the new employer is completely innocent but in an alarmingly high number of cases individuals have been employed so that the new employer can acquire that confidential information to use to its own advantage. As the market becomes more difficult we anticipate that this type of case will become even more common as businesses struggle to maintain market position.

KP