Mga Entertainment Inc. vs. Clifford T.I. Harris et al

Case Background

On December 20, 2020, Plaintiff  MGA Entertainment Inc. filed a Trademark Infringement lawsuit in the United States District Court, California Central, Western Division – Los Angeles (Case number: 2:20cv11548). Judge James V. Selna presided over the case.

Cause

MGA Entertainment, Inc., a California-based toy company, created and sold a highly successful line of toys called L.O.L. Surprise!. In July 2019, MGA launched the L.O.L. Surprise! O.M.G. fashion doll line, marketed as the “big sister” of L.O.L. Surprise! dolls. The L.O.L. Surprise! brand achieved remarkable success, winning Toy of the Year awards in 2018, 2019, and 2020. MGA invested substantial time, money, and effort in developing consumer recognition and goodwill for the L.O.L. Surprise! products and trademarks, utilizing extensive marketing through television, websites, and other media channels. The company’s success stemmed from high-quality materials, effective promotional efforts, and positive word-of-mouth from consumers.

On December 8, 2020, MGA received a cease-and-desist letter from a California law firm representing Clifford “T.I.” Harris, Tameka “Tiny” Harris, and OMG Girlz LLC. The letter alleged that MGA’s L.O.L. Surprise! O.M.G. dolls infringed upon the intellectual property rights of the “OMG Girlz” music group. It claimed that MGA’s dolls exploited the trade dress, name, image, and brand popularity of “OMG Girlz” and were derivative of their image and brand.

However, MGA contended that the OMG Girlz group had disbanded in March 2015, announcing the end of their career as a group on their official Instagram account. Furthermore, the USPTO trademark registration for “OMG Girlz,” owned by OMG Girlz LLC in classes 9 and 41, was canceled on March 6, 2020. MGA believed that any other “OMG Girlz” trademark registrations owned by the defendants had been abandoned.

Injuries

The cease-and-desist letter from the defendants posed a significant threat to MGA’s rights to use its L.O.L. Surprise! O.M.G. trademarks and to continue selling L.O.L. Surprise! O.M.G. products. This legal challenge created uncertainty and potential disruption in MGA’s business operations, particularly concerning the marketing and distribution of its popular toy line. The allegations of infringement could negatively impact MGA’s relationships with both domestic and international customers, distributors, and retailers.

Damages

While the complaint did not specify exact monetary damages, MGA faced several potential financial risks due to the defendants’ claims. These included:

  • Lost business opportunities if forced to cease production or sales of L.O.L. Surprise! O.M.G. products.
  • Potential disgorgement of profits from the sale of allegedly infringing products, as threatened in the cease-and-desist letter.
  • Exposure to punitive damages if found liable for willful infringement.
  • Legal costs and attorneys’ fees associated with defending against the infringement claims.
  • Potential harm to brand reputation and consumer goodwill built around the L.O.L. Surprise! O.M.G. product line.

Key Arguments and Proceedings

Legal representation

  • Plaintiff(s):MGA Entertainment Inc.
    • Counsel for Plaintiff: Carole E Reagan| Dean J. Zipser | Mark A. Finkelstein | Breeanna Nicole Brewer | Eileen M Ahern | Elizabeth Susan Lachman | Ellen Sooyoun Kim | Jason H Wilson | Kenneth Michael Trujillo-Jamison | Paul J Loh | Thomas Gregory Sprankling | Thomas J Umberg
    • Experts for Plaintiff(s): Bruce Isaacson
  • Defendant(s):Clifford T.I. Harris | Tameka Tiny Harris, an individual | OMG Girlz LLC | Grand Hustle LLC | Pretty Hustle LLC

Key Arguments or Remarks by Counsel

Paul J. Loh, one of the MGA  company’s lawyers, called the claims “baseless and offensive” in closing arguments — noting that MGA had sold more than 40 million “L.O.L Surprise! O.M.G.” dolls without customer confusion.

In a joint statement, attorneys on the other side of the case applauded OMG Girlz, Tiny, and T.I.’s determination and “courage to stand up for themselves and fight a billion-dollar corporation’s intimidation” — adding that the jury did the right thing by holding MGA “fully accountable.”

 Claims

MGA filed a claim for declaratory judgment under 28 U.S.C. § 2201(a) in the United States District Court for the Central District of California. The company sought several declarations from the court:

  1. A declaration that MGA’s L.O.L. Surprise! O.M.G. trademarks and products do not infringe upon the defendants’ “OMG Girlz” trademark.
  2. A declaration that MGA’s use of L.O.L. Surprise! O.M.G. marks does not cause a likelihood of consumer confusion regarding the source or sponsorship of MGA’s products.
  3. A declaration that MGA may continue to market and distribute its L.O.L. Surprise! O.M.G. fashion dolls and related products.
  4. A declaration affirming MGA’s right to continue using the L.O.L. Surprise! O.M.G. marks in association with its products.

MGA argued that no likelihood of confusion existed between its L.O.L. Surprise! O.M.G. products and the OMG Girlz mark, citing differences in target markets, product categories, and channels of trade. The company also emphasized the strong brand recognition of L.O.L. Surprise! and the apparent abandonment of the OMG Girlz trademark by the defendants.

Defense

The defendants argued that MGA Entertainment engaged in cultural appropriation and theft of intellectual property by using the OMG Girlz’s likeness and brand without permission. Grand Hustle LLC and Pretty Hustle LLC, managing entities for the OMG Girlz, claimed that MGA had publicly announced in 2010 that it would create a line of dolls modeled after the group, recognizing their positive image of young women of color. However, no licensing agreement was finalized.

In 2019, MGA released the “OMG Dolls,” which the defendants asserted bore a clear resemblance to the OMG Girlz, copying their distinctive hairstyles, fashion, and musical identity. MGA promoted the dolls through extensive advertising, including animated videos, further driving consumer confusion by portraying the dolls as performers similar to the OMG Girlz. Consumers were misled into believing that the OMG Dolls were connected to or endorsed by the OMG Girlz.

The defendants claimed that MGA profited from this misappropriation without offering any compensation or recognition to the group’s creators. They also highlighted that despite attempts to resolve the matter privately, MGA responded by filing a lawsuit to assert ownership over the dolls. This led the defendants to counterclaim, seeking damages and an injunction to stop MGA from continuing to exploit the OMG Girlz’s likeness without permission.

They accused MGA of violating intellectual property laws, engaging in unfair competition, and appropriating a brand developed by Black artists. The defendants sought compensation for lost revenue, damages for the dilution of the OMG Girlz brand, and a permanent injunction to prevent further unauthorized use of the group’s image and identity.

Expert Testimony

To evaluate the likelihood of consumer confusion regarding the alleged trade dress and the misappropriation of the OMG Girlz’ likeness, the plaintiffs engaged Dr. Bruce Isaacson to conduct consumer surveys. In turn, the defendants hired Dr. Susan McDonald as a rebuttal expert to address Isaacson’s findings. Additionally, Dr. Mangum calculated potential damages by deducting costs and expenses from the net revenue generated by the entire O.M.G. line of products, which included both dolls and non-doll items.

Jury Verdict

On September 23, 2024, the jury ruled in favor of the Defendant OMG Girlz and against Plaintiff MGA Entertainment in Trademark Infringement Lawsuit. They found that the OMG Girlz had demonstrated protectible trade dress. As a result, the jury determined that MGA had willfully infringed upon this trade dress and awarded the OMG Girlz $17,872,253 in damages. Furthermore, the jury found clear and convincing evidence that MGA acted with oppression, fraud, or malice in misappropriating the OMG Girlz’ name, likeness, or identity. This led to punitive damages of $53,616,759. In total, the jury awarded the OMG Girlz $71,488,012.

Court Documents:

Available Upon Request

Press Release:

https://abcnews.go.com/Business/wireStory/jury-awards-teen-pop-group-omg-girlz-715-114060952