District Judge Issues Sweeping Injunctions Against BRATZ Doll Manufacturer for Infringement of Mattel’s Copyrights
Last Wednesday, the Eastern Division of the Central District Court of California issued a series of extraordinarily sweeping injunctions in favor of Mattel, in the four-year legal dispute between the toy giant and the makers of the popular BRATZ dolls, MGA Entertainment.
Unless you don’t have any tween girls in your entourage, you may know that the BRATZ dolls are saucy, sexy versions of the BARBIE dolls. They came on the market in 2001 and were an instant sensation with young girls, resulting in a billion-dollar franchise, including over 40 characters, video games, and a whole host of ancillary products, accessories and related toys, like BRATZ BOYZ or BRATZ PETZ; even a movie.
Last July, Mattel won a $100 million jury award against MGA for breach of contract and copyright infringement. The jury found that the creator of the BRATZ dolls, Carter Bryant, came up with the idea and design while still under an exclusive contract with Mattel and that MGA had interfered with that contractual relationship. The jury also found that Mattel’s copyright had been infringed by the BRATZ dolls.
One of the post-trial disputes between Mattel and MGA was centered on whether the jury found that only the first generation BRATZ dolls created by Bryant while he worked at Mattel (Yasmine, Chloe, Sasha and Jade) infringed on Mattel’s copyright, or whether the entire line of BRATZ products was in violation. In this latest series of orders, issued on December 3, 2008, the District Court found the entire line to be infringing and issued the following rulings:
- MGA must cease manufacturing, marketing and selling the BRATZ line and any ancillary products;
- MGA must deliver, at its own expense, all infringing dolls and products to Mattel for impoundment; and
- Mattel is granted a constructive trust in the BRATZ and JADE trademarks and related domain names.
These unusually broad injunctions, once in place, would essentially shut down MGA’s business. It may not be the end of the Bratz quite yet, however (no matter what some parents may hope!). The District Court stayed the orders until February 2009 and MGA issued a statement that it will file an appeal to the 9th Circuit and request a stay.
Practice Pointer:
While ideas and concepts are not copyrightable, the expression of ideas and concepts is. Here, the employee crossed a line by re-using more than just intangible ideas and by taking with him actual trademarks and designs created at his former job. This case reminds us of the very real and very costly copyright risk that exists when a company hires an employee or independent contractor who has worked for a competitor. Ideally, you want your new employee to create something new and original every time but, practically speaking, that is not always possible. One prudent practice is to institute in-house policies for clear and clean copyright and content hygiene. Such policies, for example, specify which materials employees may or may not re-use in the scope of employment; and may also set forth a clearance process for “prior art” and open source materials employees are allowed to use from time to time.