Jury rules Bratz dolls conceived at Mattel

The federal jury decided Thursday that the designer of MGA's Bratz characters conceived the idea for the dolls while working for Mattel--a ruling that could mean millions of dollars for the Barbie maker when the jury considers possible damages during a separate proceeding.

Mattel filed the lawsuit in U.S. District Court in Riverside against MGA, which began marketing the hugely popular Bratz line of sassy urban dolls in 2001. Mattel has claimed it owned the rights to the Bratz line because its creator, Carter Bryant, came up with the concept while working for El Segundo-based Mattel.

Analysts estimate Bratz has made MGA more than $500 million a year.

The jury also ruled that MGA and its CEO Isaac Larian were liable for converting Mattel property for their own use and intentionally interfering with the contractual duties owed by Bryant to Mattel.

"MGA and Isaac Larian took what did not belong to them," John Quinn, a lawyer for Mattel, said during a conference call detailing the verdict.

Larian said in a prepared statement that MGA will prevail in the upcoming damages phase of the case or possibly in the 9th U.S. Circuit Court of Appeals.

"This is because it is undisputed that MGA--not Carter Bryant--independently created the Bratz dolls," Larian said. "Carter Bryant did not have anything to do with the many Bratz-related products we created, such as Bratz Babyz, Lil' Bratz and Bratz Kidz."

The statement pointed out that jurors must still decide if Mattel owns any copyrights involving Bryant's drawings. If so, the jury must rule on whether the dolls infringe on those copyrights.

Bryant reached a confidential settlement with Mattel on the eve of the trial and the company dropped its lawsuit against him.