Judge paves way for Mattel to sue Bratz inventor

Mon Apr 28, 2008 6:32pm EDT

NEW YORK (Reuters) - A federal judge in California has cleared the way for Barbie doll maker Mattel Inc (MAT.N: Quote, Profile, Research) to go forward with its lawsuit against ex-employee and Bratz dolls inventor Carter Bryant.

Mattel, the world's largest toy maker, had claimed it owns MGA Entertainment's Bratz dolls because Bryant conceived the big-headed, pouty-lipped toys while he worked as a Barbie designer.

In a ruling issued on Friday, U.S. District Judge Stephen Larson said "the undisputed facts establish that Bryant breached his fiduciary duty to communicate his inventions to Mattel when, rather than doing so, he secretly entered into a contract with Mattel's competitor, while still employed by Mattel."

Sales of Barbie dolls have waned in recent years amid fierce competition from Bratz dolls, which burst onto the market in 2001. Mattel said this month the Bratz litigation was a factor in its $46.6 million first-quarter loss.

"The facts are on our side and we are confident we will prevail at trial," MGA Chief Executive Isaac Larian said in a statement. " MGA ... built Bratz -- and no one else."

(Reporting by Justin Grant, with additional reporting by Lisa Baertlein in Los Angeles; editing by Carol Bishopric and Braden Reddall)