Judges Cut Back Damages Owed by Mattel in Doll Case

The Court of Appeals for the Ninth Circuit ruled that a jury should not have been allowed to consider MGA’s claims that it was the victim of trade secret theft during a trial that was convened to consider a lawsuit by Mattel, which contended that MGA stole the idea for Bratz from Mattel.

The case dates to 2004 when Mattel first filed a lawsuit asserting that the designer of the toys, Carter Bryant, was working for Mattel when he did the initial drawings and early work on the Bratz, hip-hop-inspired dolls with large eyes, heads, lips and feet, and tiny noses.

The Bratz doll, introduced in 2001, was a blockbuster and posed a serious challenge to Mattel’s Barbie after decades of fashion doll dominance.

A jury awarded Mattel $100 million in 2008 and found that Mr. Bryant had developed the Bratz concept while with Mattel. But the Ninth Circuit overturned that verdict and a new trial was ordered.

Before the start of the second trial in Santa Ana, Calif., Judge David Carter of Federal District Court allowed MGA to submit a counterclaim to the jury that accused Mattel of engaging in corporate espionage at toy fairs and conspiring to keep Bratz products off retail shelves.

In April 2011, a jury rejected Mattel’s claims and sided with MGA. Mattel was ordered to pay MGA a total of $309 million in damages and legal fees.

On Thursday, a unanimous three-judge panel ruled that the trial judge was wrong to have allowed the jury to consider MGA’s counterclaims because they were unrelated to Mattel’s initial lawsuit.

MGA said it would continue to pursue its trade-theft claims by filing a new lawsuit. For its part, Mattel asserted in a statement, “We are confident that such a lawsuit will be barred by the statute of limitations.”

Chief Judge Alex Kozinski, writing for the same Ninth Circuit panel that overturned the initial verdict in 2008, said MGA could keep $137 million in legal costs spent fighting the Mattel lawsuit.

“While this may not be the last word on the subject,” Judge Kozinski said, “perhaps Mattel and MGA can take a lesson from their target demographic: Play nice.”

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Elliot Handler, Co-Founder Of Mattel Toys, Dies at 95

The cause was heart failure, his daughter, Barbara Segal, said.

Mr. Handler helped introduce Barbie, helped design the talking doll Chatty Cathy and popularized Hot Wheels toy cars.

He began Mattel in 1945 with his wife, Ruth, and a short-term partner. Until the Handlers were forced out of Mattel in 1975, they oversaw a toy empire that is among the largest in the world today.

Elliot Handler was born April 9, 1916, in Illinois. He was a struggling art student and designer of light fixtures when, in 1939, he began making costume jewelry and dollhouse furniture in his garage in Southern California. Eventually, he designed a realistic-looking miniature piano that caused a furor at the New York toy fair. Stores ordered more than 300,000 of them — but the Handlers had mispriced the toys, losing about a dime on each one.

They fell into debt until a music arranger approached them with an idea for a new way to manufacture cheap, tiny music boxes. Previously, such musical devices were luxury items manufactured almost exclusively by European artisans. The Handlers started putting the devices into jack-in-the boxes, plastic ukuleles and dolls. The products were an almost immediate hit, earning millions. Eventually Mattel released a talking doll — Chatty Cathy — that tutored generations of children in the lilting intonations of “I love you,” and “May I have a cookie?”

Ruth Handler drove Mattel’s business decisions while her husband nurtured new toys. When Mrs. Handler said that Mattel needed to develop a plastic doll that looked like a mature woman — with a small waist, long legs and a bosom that could put an eye out — her husband and others demurred. She insisted, and named the product after their daughter, Barbie. Later came Ken — named after their son, who died of a brain tumor in 1994.

Years later, Mr. Handler became focused on die-cast toy cars. The company recruited designers from auto companies like General Motors, and perfected a manufacturing process for plastic wheels that could spin fast. Since then, more than 10,000 different Hot Wheels models have been manufactured, including “King ’Kuda,” “Evil Weevil” and the “Beatnik Bandit.”

“He loved coming up with new cars,” said Sid Handler, his brother. “He loved the design part, and Ruth loved the business. It worked pretty well. He was a quiet, kind man. I think that’s why he liked toys so much. They make people happy.”

After retiring from Mattel, Mr. Handler devoted himself to painting, particularly in the photorealistic genre. His wife died in 2002. Mr. Handler is survived by his daughter, his brother and five grandchildren.

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