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Mattel, Inc. v. MGA Entertainment, Inc., et al.

The district court granted Mattel’s motion for an injunction barring its competitor MGA Entertainment from selling Bratz dolls after the jury found that MGA was liable to Mattel for copyright infringement and after the court concluded that the Bratz and Barbie dolls are substantially similar.

The jury found that Carter Bryant created and developed the name, concept, and prototypical sculpture for the hugely-successful Bratz doll while working as an employee of Mattel and while bound by the terms of an Inventions Agreement, which provided that all rights to such property belong to Mattel. The jury also found that MGA Entertainment and some of its officers intentionally interfered with Bryant’s contractual relations with Mattel and aided and abetted Bryant’s breach of fiduciary duty and breach of loyalty to Mattel.

The court addressed the four factors to consider when weighing an injunction: irreparable injury to the plaintiff, whether remedies available at law are adequate to compensate for that injury, the balance of the hardships between the parties, and the public interest. Regarding irreparable injury, the court stated that it “can envision no case more appropriate for a finding of irreparable harm. Here ... an employee bound by contract and fiduciary duty to communicate to his employer (and keep confidential from all others) all copyrightable works he creates during the term of his employment, not only fails to so communicate but actually secretly purports to convey the rights thereto to a direct competitor of his employer. The rights to those works are actively concealed from their true owner (by both the employee and the competitor) for years while the competitor exploits the works, reaping profits therefrom totaling hundreds of millions of dollars [and the] defendants remain steadfast in their intention to continue to produce their infringing products. Viewed in this light, Mattel has established irreparable injury on the basis of the MGA parties’ past infringement and the high probability of continued acts of infringement.”

The injunction bars MGA from selling certain Bratz dolls, requires the impoundment of the dolls and the destruction of the specialized plates and molds used to make the dolls, and requires MGA to recall the dolls from retailers. However, the court stayed the injunction until February, 2009.