July 17 (Bloomberg) -- Mattel Inc., maker of the Barbie doll, won a jury verdict concluding a former employee made original drawings of MGA Entertainment Inc.'s Bratz dolls while he still worked at Mattel.

The federal jury in Riverside, California, agreed today that designer Carter Bryant made most of the first sketches of the pouty, multiethnic Bratz characters while he was employed by Mattel in 1999 and 2000. The verdict helps clear the way for Mattel to seek hundreds of millions of dollars in damages for copyright infringement from closely held MGA.

The jury found that Bryant had conceived the Bratz characters and name while he was employed by El Segundo, California-based Mattel and that MGA and its chief executive officer, Isaac Larian, were liable for intentional interference with Bryant's Mattel contract.

``Today's decision is a victory not only for Mattel but for all those who believe in fair play,'' Mattel Chief Executive Officer Bob Eckert said in an e-mailed statement. ``While the case has been very complicated, the underlying principle has been a simple one: You shouldn't take what isn't yours.''

Mattel can't assert ownership of the Bratz franchise, Larian said in an e-mailed statement. Bryant didn't have anything to do with many Bratz-related products, Larian said.

`Ultimately' Successful

``We at MGA remain confident that we will ultimately be successful,'' Larian said. ``It's undisputed that MGA -- not Carter Bryant -- independently created the Bratz dolls.''

MGA and Bryant argued during the trial that the designer came up with the idea for the dolls and made the original sketches in 1998, while he was living with his parents in Missouri and wasn't working for Mattel.

``The real issues will be flushed out'' in the trial's next phase dealing with Mattel's copyright-infringement claims, MGA lawyer Thomas Nolan said outside the courtroom. ``We've always taken the strong position that the 3-D Bratz dolls do not infringe on Carter Bryant's drawings.''

MGA made substantial changes to the dolls to make them marketable, Nolan said. Their success was a result of branding and not any use of the drawings, he said.

Mattel, the world's biggest toymaker, claimed in court filings that MGA, based in Van Nuys, California, gets about $500 million a year from Bratz sales and licenses. The popularity of Bratz, first introduced in 2001, has contributed to a slide in Mattel's Barbie sales.

Bryant Settlement

Bryant settled with Mattel in May, a week before the start of the trial. Terms weren't disclosed. Mattel had sought $35 million in royalties that the designer received from Bratz sales, according to MGA.

The jury couldn't decide on the timing of four of Bryant's drawings out of 78 sketches. Mattel lawyer John Quinn said during a conference call that those drawings were ones Bryant claimed he made in August 1998, inspired by students he saw at Kickapoo High School in Springfield, Missouri. Jurors might have thought they weren't made while Bryant was at Mattel because they were very different, Quinn said.

``They didn't believe the original drawings were Bratz,'' Quinn said.

At the trial's next phase, Mattel will seek to prove that the Bratz dolls are substantially similar to the drawings that Mattel can now claim it owns, Quinn said. The company also will seek damages from MGA and Larian for contract interference and conversion, as well as aiding and abiding Bryant's breach of fiduciary duty and his duty of loyalty to Mattel.

Quinn declined to say how much in damages Mattel will seek from MGA. He also declined to comment on whether the companies are discussing settlement.

U.S. District Judge Stephen Larson ordered the jury to return July 23 for the trial's next phase.

Mattel rose 58 cents, or 3.3 percent, to $18.28 in New York Stock Exchange composite trading before the verdict was announced. The stock rose as much as 6.7 percent to $19.50 in after-hours trading.

The case is Bryant v. Mattel, 04-9049, U.S. District Court, Central District of California (Riverside).

To contact the reporter on this story: Edvard Pettersson in Los Angeles at epettersson@bloomberg.net.

Last Updated: July 17, 2008 20:54 EDT