MGA CEO tells of Bratz doll origins at Mattel trial

By Gina Keating

RIVERSIDE, Calif., June 5 (Reuters) - The chief executive of the toy company fighting Mattel Inc (MAT.N) over ownership of the $1 billion Bratz doll franchise said on Thursday that the company actively tried to recruit "stars" from the toy giant to staff his growing company and develop toy concepts.

Isaac Larian, chief executive of MGA Entertainment Corp, testified under questioning from Mattel lawyers that he told his staff to "aggressively recruit from inside Mattel" but had not heard of Bratz until late 2000 when a Mattel designer named Carter Bryant came in for an interview.

"Mattel does fire and does lay off a lot of people so they have a right to get jobs," Larian testified on Thursday in federal court in Riverside, California.

Mattel has sued MGA for copyright infringement, contending the dolls were based on drawings Bryant made while he worked at Mattel under an invention agreement in which he ceded the copyrights to his creations.

Mattel also has accused MGA and Larian of poaching its designers to shore up weak toy offerings, and of using Mattel personnel and resources to develop the hit Bratz dolls.

MGA says the big-headed, pouty lipped Bratz dolls -- which it touted last year as a billion-dollar franchise -- were conceived in 1998 during a hiatus Bryant took from Mattel.

Mattel attorneys closely questioned Larian, an Iranian immigrant who founded his family owned company in 1982, about a series of emails he sent in 1999 to top executives.

"Why are we waiting for a lay off?" Larian wrote in one email. "They don't lay off their stars."

"We need these positions filled urgently," he wrote in another email. "Please run an ad and recruit from Mattel."

Larian also said he first met Bryant at a September 2000 meeting at which he was presented with the drawings for dolls that Bryant had named Bratz.

"I thought they (Larian's staff) had brought somebody...for a job for fashion doll design," Larian testified. "My recollection is that he was coming in for a job interview."

Bryant, who recently reached confidential settlement of a lawsuit filed by Mattel over the dolls, quit his Barbie designing job the next month and went to work for MGA in October 2000. Bratz hit the market nine months later.

Mattel has accused MGA of secretly buying Bryant's design despite knowing about his Mattel contract and then trying to cover up his involvement in the Bratz franchise by concocting false stories about who invented the doll after it became a best seller.

On Thursday, Mattel attorneys also went over differing accounts Larian gave to the media about how the dolls were invented, including a Wall Street Journal interview in which he said Bratz emerged from a fashion doll design contest.

"She didn't mishear me," Larian said of the reporter. "It's possible I said that."