Dorel to pay US$3.4 million to Mattel for violating trade patents
May 15, 2008MONTREAL - Dorel Inc. (TSX:DII.B) has been ordered by U.S. court to pay US$3.4 million to toy manufacturer Mattel for violating trade patents.
The ruling issued May 5 by the Delaware District Court resulted from a lawsuit initiated in 2001. Montreal-based Dorel has no plans to appeal the ruling, spokesman Rick Leckner said.
Mattel argued in its claim that two Safety 1st products - Magic Motion and 2-n-1 Bouncenette - violated some patents. Dorel purchased Safety 1st in 2000.
In an initial ruling in August 2003, the court imposed an injunction prohibiting Dorel from manufacturing and marketing the two products. A jury decision in 2007 found the violation was "voluntary" and ordered Dorel to pay $1.3 million in damages.
Delaware Court Justice Gregory Sleet confirmed the award and added $1 million for damages before 2003 and $3.4 million in interest, for a total of $5.7 million.
But Leckner said the total award was $3.4 million because the interest was miscalculated by the court.
He said the award won't have a material impact on the company because a provision has already been taken.
Dorel subsequently altered the design to respect Mattel's patents, Leckner added.
On the Toronto Stock Exchange, Dorel's shares closed up seven cents to $31.10.
