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From ‘Dragons’ Den’ to Lawyers’ Lair!
- Dec 12, 2024
- Latest Journal
by Wendy Munt, UK Toy Industry and Retail Expert Witness.
The world of Toy Litigation is big business and Toytown has seen some high profile cases in recent years, notably the 7 year long intellectual property ‘battle of the dolls’ between Barbie v Bratz and Argos and Littlewoods being fined £22.6m for Price Fixing on Hasbro toys.
As an expert witness in the UK Toy Industry and Retail, Wendy Munt has worked with some of the notorious Dragons and entrepreneurs from the BBC’S ‘Dragons Den’; in an advisory capacity and now with Kings Counsel. As an expert, she is able to survey the landscape of her profession after 24 years working in senior commercial buying roles for 4 major retail giants and 12 years as a consultant to many clients ranging from SME’s to industry megabrands Lego, Disney and many other blue-chip leading companies. Peter Jones and Theo Paphitis have benefited from her expertise and Wendy has used it to build positive working relationships with Law firms to now also work as an Expert Witness. She is currently involved in a long-running competition case which is due to go to trial at the High Court this October.
Having spent 34 years in the UK Toy Industry and in commercial retail on both sides of the retailer/supplier fence, I have experienced most of the many complexities faced in all areas of manufacturing, importing, retailing and licensing. This uniquely enables me to assist my clients throughout any part of a toy products’ cradle-to-grave journey. For retailer clients, I create and implement category buying and merchandise plans to meet their strategic objectives and deliver successful ranges which grow their sales, profitability and market share of their branded, own label and character licensed toys.
Some toy inventor and SME clients come to me to assess if their concept is commercially viable ahead of potentially wasting considerable time and money on development. If I feel the idea is worth progressing, I often also help manage the toys’ development process from conception to its launch into the marketplace.
Following achieving commercial success in a specific toy category, some toy companies are keen to diversify into new toy sectors and naturally want to be sure if it would be a wise move. By sharing my knowledge of the opportunities and challenges which may exist with specific categories, they are able to determine if the risks are worth taking and if such a transition is right for their business.
Brand licensing allows toy companies to ‘rent’ a popular brand such as Star Wars, Peppa Pig and use it to drive sales of their toys. When children have a strong connection with a character brand, they want it to be present in every part of their lives; nightwear, backpacks and clothing being the leading categories for licensed merchandise for children. With the global licensing industry reaching $280.3bn in 2021, this growing industry helps bring together much loved brands and consumers in new and innovative ways and now accounts for 28% of the UK toy market.
With my licensor clients who own the character brands, I help maximise their sales and royalties through recommending the best suppliers and factory manufacturers with whom to partner from a product and reliability of supply perspective.
The three-way relationships between licensors, licensees and retailers are close, symbiotic ones, so it is essential all parties work effectively together. Having worked in both toy retail buying and for a toy supplier, I can help clients on how they can best achieve strong and mutually beneficial trading relationships.To be a Toy Industry expert takes many years of understanding the diverse dynamics of its many types of toy; some being heavily influenced by consumer trends and others recurring annually. Each category performs very differently to the rest in their level of sales, margin, timing, responsiveness to promotion, competitiveness and ability to sell in different types of retailer.
Being a fast moving fashion industry, the need for differentiation of products and offers, and speed to market are all vital for success. I also assist clients with new toy product development using my extensive knowledge of the market sectors, brands and pricing, with combining my detailed knowledge of its business models for supply.
Given the vast size of the global toy market and dramatic growth in online shopping, there has been a considerable increase in the quantity of infringing and unregulated toys offered online. Infringing goods include counterfeit toys, trademark infringing toys, and unlicensed items. Litigation concerning Intellectual property disputes on toy products occur reasonably often. Two major players within the plush toy industry are currently embroiled in a legal battle over copyright infringement. The dispute is between Build-A-Bear and Squishmallows and the outcome of the lawsuit is believed to ‘shape the landscape of intellectual property protection for plush toys’ especially with regard to distinguishing between original designs and copycat products.
The most high profile case in the toy industry was also a dispute over intellectual property. Mattel sued MGA Entertainment and the originating designer, Carter Bryant, claiming design rights of Bratz dolls as he had the idea for the Bratz dolls whilst employed by Mattel at the time and whilst still working with Mattel, Bryant showed them to MGA who progressed them. Mattel claimed they owned the rights, MGA countersued Mattel and so a decade of litigation ensued.
The jury issued a general verdict (i.e. without specific findings) that MGA wrongfully acquired the ideas and was liable for infringing Mattel’s copyright and awarded Mattel US$100 million. The U.S. Court of Appeal for the 8th Circuit reversed the decision and remanded the case for a new trial which Mattel lost. The jury did not agree that Mattel owned Bryant’s idea.
The entry to market in many countries is subject to the compliance with toy legislation and standards. Failure of manufacturers and importers to comply with the expanding universe of toy legislation can present significant legal and reputational risks.
About the Author: Wendy Munt is a Director and Consultant with ‘Be Inspired Consulting Limited’. She has worked as an Expert witness on 2 cases, both involving toys and games within the UK retail Industry. The first litigation case went to trial at the High Court in 2011. Wendy has prepared a number of expert reports in relation to a long-running competition dispute and is also due to give evidence at the High Court in October 2024.
She is currently undertaking her CUBS Certificate as part of her CPD with Bond Solon.
For details of Wendy’s services, client testimonials, ‘Making of A Toy Expert’ feature in Toys n’ Playthings and other trade press articles Wendy has written, see www.beinspiredconsulting.net