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June 3, 2011 5:30 PM

Orrick Files to Withdraw from MGA, Bratz Dispute

Posted by Tom Huddleston Jr.

Orrick, Herrington & Sutcliffe has filed a motion to withdraw from a case related to MGA Entertainment Inc.'s dispute over its Bratz doll product line due to unpaid fees.

Am Law Daily sibling publication The National Law Journal reported on Thursday that the firm filed its motion on May 27 on the ground that MGA allegedly owes more than $1.2 million in attorney fees.

As we reported last week, MGA currently is in court battling rival Mattel, Inc. over attorney fees. MGA won an April jury verdict over Barbie-maker Mattel that named MGA the rightful owner of the Bratz doll line. Orrick began representing MGA in that case in May 2009 and helped win the $88.5 million verdict in the retrial. MGA now is seeking $129 million in attorney fees from Mattel. (The NLJ reports that U.S. District Judge David Carter has not yet ruled on the fees in the Mattel matter.)

NLJ reports that Orrick began its representation of MGA under the understanding that the company's insurers would pay its legal bills, which the firm says were based on "normal hourly rates," but that MGA would pay outstanding invoices regardless of insurance coverage. In a declaration submitted in the current case over attorney fees with Mattel, Orrick partner Annette Hurst--co-lead trial counsel in the Mattel matter--said MGA did not pay the firm until the fall of 2010, and then only for the months of November and December. 

Hurst added that MGA has informed Orrick it will not be retained as counsel should the Mattel attorney fees case go to court. Mattel is also expected to appeal the first case's verdict, which would delay any payment for several years, according to Hurst, and MGA has given no indication that it would use proceeds from that judgment to pay Orrick's fees for the second case.

MGA currently is embroiled in litigation with its insurers and with O'Melveny & Myers, which sued the company last year in order to recover $10.2 million in fees. MGA also owes fees to several additional firms in relation to the Mattel case, including Skadden, Arps, Slate, Meagher & Flom and Keller Rackauckas.

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