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A federal judge in California was having none of a lawyer’s attempts to reduce an $88.5 million verdict against Mattel Inc. in its copyright infringement and trade secrets dispute over the Bratz doll. Mattel attorney Michael Zeller attacked the formula a jury used to calculate the damages to Bratz doll manufacturer MGA Entertainment Inc. The jury found on April 21 that each of 26 instances of trade secrets theft had unjustly enriched Mattel by about $3.4 million on average. During arguments over post-trial motions on May 25, Zeller tried to argue that the damages shouldn’t have been based on an average amount — but U.S. District Judge David Carter fired back immediately, noting that neither party had given the jury a good basis for calculating exact damages on each of the 114 trade secret claims at issue. “What you did was place a jury in a position of having to come up with a lump sum number,” he said during the hearing in Santa Ana, Calif. “You both did this.” The jury rejected Mattel’s claims that MGA had infringed on its copyright by hiring away a designer who allegedly stole the idea for the Bratz doll. The jury also concluded that Mattel did not own the rights to the first four models of the Bratz dolls or two newer versions. Jurors found for Mattel on one issue: They awarded damages of $10,000 after finding that MGA and its chief executive officer, Isaac Larian, intentionally interfered with the contract between Mattel and the designer, Carter Bryant. The damages award represented a major setback for Mattel, which in 2008 obtained a $100 million verdict during the first trial between the toy companies. Last year, the U.S. Court of Appeals for the 9th Circuit overturned that verdict, ruling that the judge had abused his discretion in giving Mattel the rights to the dolls. In a May 6 court filing, another Mattel lawyer, John Quinn, name partner at Los Angeles-based Quinn Emanuel Urquhart & Sullivan, moved to reduce the damages or, in the alternative, obtain a new trial, on the ground that “the jury’s awards are not supported by sufficient evidence, are arbitrary, and reflect awards for trade secrets for which no damages estimates were admitted.” In court, Zeller, also a partner at Quinn Emanuel, argued that MGA’s expert, James Malackowski, did not testify about all of the 26 trade secrets for which the jury awarded damages. Furthermore, he said, the $3.4 million figure was not intended to represent an average; had it been applied to all 114 trade secrets claims in the case, MGA would have received $387.6 million–about $185 million more than Malackowski’s highest calculation of damages, he said. He noted that it was MGA’s idea put each trade secrets claim on the verdict form. But Carter reminded him that neither party provided the jury with damages for each specific trade secret. That left the jury to decide the total figure. “I offered you a lump sum at one time,” Carter said. “Practically, the parties just ignored it.” MGA’s attorney, Warrington Parker, of counsel at Orrick, Herrington & Sutcliffe’s San Francisco office, wrote in a May 12 objection to Mattel’s motion that the jury was entitled to average out the damages and award an amount higher or lower than Malackowski had calculated. “Far from being inconsistent or excessive, the jury’s damages award is amply supported by the evidence and is due a high degree of deference,” he wrote. “Mattel may not like the verdict as given, but there can be no dispute that the jury had substantial evidence upon with to reach its conclusions and that those conclusions are reasonable in light of the evidence.” Earlier during the hearing, Carter heard arguments from MGA’s Annette Hurst, another partner at Orrick, that Mattel owed more than $129 million in attorney fees based on the failure of its copyright infringement claim and another $177 million in punitive damages tied to the trade secrets claims under the California Uniform Trade Secrets Act. Carter issued some tentative orders on other post-trial motions but did not indicate when he would rule on MGA’s fees or damages motion or on Mattel’s motion for new trial. Contact Amanda Bronstad at [email protected]

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