MGA Entertainment Wins Ruling Against Insurers-PUBLISHED AS IT IS SAID IN JULY,2009

Posted date: 7/15/09

By DEBORAH CROWE

Los Angeles Business Journal Staff

MGA Entertainment said Wednesday that a judge ruled that two insurance companies that earlier refused to pay for its defense in its Bratz legal battle with Mattel Inc. are legally bound to do so.

A federal jury decided last year that a former Mattel doll designer created the Bratz name and characters for MGA while still working for Mattel. The Van Nuys toymaker is on the hook for more than $160 million, including a $100 million damage award and more than $60 million in court costs.

The U.S. district judge in the case, Stephen G. Larson, last month granted a summary judgment against Crum & Forster and Evanston Insurance Co., saying they had to pay despite certain policy exclusions, MGA said.

“This is a significant development which will open the way for recovery of all past and future damages suffered by MGA,” said attorney Michael J. Bidart, who represents MGA, in a statement.

A future trial will determine how much the insurance companies owe the company. MGA said. It is possible that even the damage award, or a portion of it, could be covered by insurance.

The company last month reached a separate settlement with three other insurers – Hartford Insurance Co. of the Midwest, Hartford Fire Insurance Co. and the Hartford Financial Services Group Inc. – over the damages and legal bills.

MGA filed a federal lawsuit in 2008 against the all the insurers, saying they had breached their agreement to pay for MGA’s defense.

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