MGA Entertainment Withdraws Motion in Lady Gaga Dolls Suit

MGA Entertainment Inc. withdrew a request for a court order forcing pop star Lady Gaga to approve a line of dolls in her image, saying progress has been made toward settling a dispute with the singer.

MGA sued Stefani Germanotta, whose stage name is Lady Gaga, her management company, Culver City, California-based Atom Factory, and Los Angeles-based Bravado International Group, a merchandising company that works with musicians, in New York State Supreme Court in Manhattan last month, seeking more than $10 million in damages.

MGA Entertainment, based in Van Nuys, California, said in the complaint that it agreed to produce dolls in the singer’s image in December 2011 at Bravado’s “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.

MGA had sought a preliminary injunction ordering Bravado, Atom Factory and Lady Gaga to immediately provide final written approval of samples of the dolls, and the two sides were scheduled to argue the matter in court next week,

MGA said in a court document filed yesterday that it was withdrawing its motion “in view of the progress which the parties have made towards settlement, and in order to afford the parties the opportunity to focus their efforts on further pursuit of settlement in the upcoming days.”

Michael R. Patrick, an attorney with Grimes & Battersby LLC in New York who is representing MGA Entertainment, and Seth D. Fier, an attorney with Proskauer Rose who is representing Germanotta and Atom Factory, didn’t immediately respond to telephone messages seeking comment on the court filing.

Universal Music Group

Peter Lofrumento, a spokesman for Vivendi SA’s Universal Music Group, the parent company of Bravado, also didn’t immediately respond to a phone message seeking comment.

In April, Bravado Chief Executive Officer Tom Bennett, told MGA’s chief executive officer, Issac Larian, that Germanotta wanted to delay production and shipping of the dolls until her new album is released in 2013, according to the complaint.

MGA said in the complaint that the defendants have continued to withhold final approval to delay marketing the dolls until next year and instead sell a licensed Lady Gaga perfume called “Fame.”

MGA Entertainment estimated the Lady Gaga line of dolls would yield $28 million in revenue for the fall 2012 retail season, and had agreements 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

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