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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