Mattel Sues Insurance Group for Reimbursement of Settlement
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Mattel Inc., the world’s largest toy maker, sued a California insurance group for reimbursement of $20 million the company paid to settle a shareholder suit.
Mattel claims that the California Insurance Guarantee Assn., which was created to administer claims when an insurer becomes insolvent, refuses to reimburse it more than $500,000. One of Mattel’s directors’ and officers’ policies was with Reliant Insurance Co., which dissolved in late 2001.
Mattel, the maker of Barbie dolls and Matchbox cars, in December reached a $122-million settlement with shareholders who sued over the company’s 1999 acquisition of software developer Learning Co. Mattel said at the time that it expected its share to be $25.5 million, and the rest would be paid by its insurers.
El Segundo-based Mattel this month said its share of the U.S. toy market through May has declined as much as 1.75 percentage points to 19%, citing researcher NPD Group. Inventories remain high at retailers after a disappointing Christmas season because consumers concerned about unemployment are reluctant to spend.
Mattel’s suit was filed Friday in Los Angeles Superior Court. A call to the California Department of Insurance wasn’t immediately returned.
Mattel shares fell 20 cents to $18.92 on Monday on the New York Stock Exchange.
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