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MGA/Mattel Verdict Vacated

District Court Rules MGA Is Entitled to New Trial on All Issues

$100 Million Verdict Vacated in its Entirety

VAN NUYS, Calif., Nov. 1, 2010 -- The litigation losses continue to mount for Mattel in its protracted legal battle with MGA Entertainment in the so-called Battle of the Dolls. On October 29, 2010, Judge David Carter granted MGA's request for a new trial on all issues decided in the trial held in 2008, including vacating the entire $100 million damages verdict awarded to Mattel. Finding numerous errors by former district court judge Stephen Larson, including errors in instructing the jury and taking issues away from the jury, which were "central, significant, pervasive, and likely determinative of the outcome of all claims" in the 2008 trial, Judge Carter found that "[a] full new trial is therefore required and all verdicts and damages awards must be vacated."

MGA is gratified that the prior erroneous rulings and jury instructions have been corrected. As Judge Carter noted, these erroneous rulings were "likely determinative of the outcome" of the prior trial. Now, armed with the correct legal rulings and with the jury properly instructed, MGA is confident that it will prevail on all claims in the upcoming trial in January 2011. Although gratified by the correction of the errors and looking forward to bringing this litigation to an end, MGA's gratitude is tempered by the heartache and financial devastation that MGA and its employees have been forced to endure, including the hundreds of MGA employees and their families who lost their jobs through layoffs, as a result of the erroneous rulings and by Mattel's relentless business strategy of "litigating MGA to death."

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