Chaos over Bratz

That's because the Ninth Circuit Court of Appeals ruled a couple of weeks back that Van Nuys-based MGA Entertainment can continue to sell the pouty-lipped dolls, even though a lower court ruled that Mattel could take over the manufacture of the doll. El Segundo-based Mattel, as you may know, won a copyright infringement case against MGA. But the appellate decision, which barely got noticed, has put everything in limbo land. From the Business Journal:

That situation, in turn, is causing what one observer called "total chaos in the marketplace." Retailers are unsure if either company can live up to any contract to deliver the doll in the future. And some in the toy industry wonder if either company can be truly committed to the line since its ownership is up in the air.

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But perhaps more importantly, the court indicated that it doesn't look favorably on the original decision. The appellate judges said that the order transferring ownership of the Bratz trademark and copyright from MGA to Mattel was "drastic," and questioned why Mattel wasn't simply given a royalty or ownership stake in MGA's Bratz franchise. The appellate judges also ordered Mattel and MGA to mediation. In other words, the two companies should try to sort it out themselves.

So Mattel, relying on the previous court ruling, is ready to launch its own Bratz line, while MGA is preparing next season's Bratz dolls.