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Mattel Case Illustrates Importance of Employment Contracts

The recent Bratz Doll cases involving Barbie Doll giant Mattel illustrates the importance of employment contracts in New York.

Of course, the case also involves copyright, trademark and licensing issues and illustrates why hiring a business litigation attorney in New York is always important when establishing new product lines or dealing with issues involving terms of employment for highly-skilled employees.Forbes reports Mattel was ordered to pay an $89 million jury verdict to tiny rival MGA Entertainment; Mattel originally won a $100 million verdict against MGA in 2008, however that verdict was overturned on appeal.

At issue was whether a Mattel designer had the rights to develop the wildly popular Bratz doll on his own time and sell it to a rival. The employee claimed he developed the doll while living with his parents in Missouri — between stints working for the company.

Mattel argued the invention came during his second stint with the company — and that he violated the terms of his inventions agreement by taking the concept to MGA Entertainment. The company claimed copyright infringement and breach of contract and was awarded $100 million at the original trial.

However, the appeals court overturned the verdict, ruling that MGA deserved “sweat equity” for manufacturing and marketing the doll.

The Law Offices of Ira S. Newman represents businesses and employees dealing with employment issues, including employment contracts. Call 516-487-7375 or contact us through the website.