Lady Gaga Sued by Maker of Bratz Dolls Over Contract Breach
By Chris Dolmetsch - 2012-07-24T23:12:07Z
Lady Gaga and her management company were sued by MGA Entertainment Inc., the maker of Bratz toys, for failing to approve a line of dolls in the pop stars image.
The Van Nuys, California-based company, alleging breach of contract in New York state court, is seeking more than $10 million in damages from the pop star, her management company, Culver City, California-based Atom Factory, and Los Angeles- based Bravado International Group, a merchandising company that works with musicians and music groups.
MGA Entertainment says in the complaint that it agreed to produce dolls in Lady Gagas image in December 2011 at Bravados request and insistence and paid the company a $1 million fee in anticipation of shipping the products to retailers this summer in time for the holiday selling season.
In April, Bravados Chief Executive Officer, Tom Bennett, told MGAs chief executive officer, Issac Larian, that Lady Gaga wanted to delay production and shipping of the dolls until her new album is released in 2013, according to the complaint. MGA says the defendants have continued to withhold final approval in order to delay marketing the dolls until next year and instead sell a licensed Lady Gaga perfume called Fame.
Defendants conduct is egregious, in bad faith and is pretextual, especially in light of the fact that MGA has, among other things, paid Bravado a $1,000,000 advance, agreed to an excessively generous royalty rate, invested millions in the preproduction of the Lady Gaga dolls and put its repu! tation a nd goodwill on the line in order to secure distributors and retail shelf space, MGA Entertainment said in the complaint.
Amanda Silverman, a spokeswoman for Lady Gaga, said the singer hasnt seen the complaint and has no comment.
This is a dispute between Universal Music Groups merchandising company and MGA, Silverman said in an e-mail. There was no legitimate reason for dragging Lady Gaga into that dispute. Lady Gaga will vigorously defend MGAs ill- conceived lawsuit and is confident that she will prevail.
Peter Lofrumento, a spokesman for Vivendi SAs Universal Music Group, the parent company of Bravado, said in an e-mail that the claims in the suit are meritless and the company will vigorously defend itself in court.
A telephone message left at the headquarters of Atom Factory wasnt immediately returned.
MGA Entertainment says it estimated $28 million in revenue for the fall 2012 retail season for the Lady Gaga line of dolls and had agreements in place with at least six distributors, with orders coming from at least 10 countries, according to the complaint.
MGA Entertainment last year won $310 million in damages and fees from Mattel Inc. (MAT) in a trial over ownership of the rights of the Bratz line of dolls. Mattel in February asked a federal appeals court to reverse the judgment.
The case is MGA Entertainment Inc. v. Bravado International Group Merchandising Services Inc., 652547/2012, New York State Supreme Court (Manhattan).
To contact the reporter on this story: Chris Dolmetsch in New York at cdolmetsch@bloomberg.net
To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net