immediate release --December 22, 1999.
Contact Bob Brammer, 515-281-6699
Delivers 5,228 More Toys to
Iowa in Wake of Antitrust Lawsuit
this year Mattel agreed to pay millions in cash and toys nationwide --
but States argued Mattel first provided outdated and impractical toys.
Mattel is distributing $4 million more in toys -- $41,000 worth to Iowa.
The Mattel toy company has delivered 5,228 more toys for holiday distribution
in Iowa to less fortunate children - a supplemental distribution Mattel
agreed to after States argued that toys delivered earlier by Mattel were
out of date or did not represent the broad variety of toys produced by
Mattel was obligated
to provide the toys as a result of an antitrust action by Iowa and 43
other states that concluded last spring. The lawsuit alleged that toy
makers including Mattel - under pressure from toy retailer Toys 'R' Us
- illegally had restricted sales and supply of their most popular toys
to other retailers, especially warehouse clubs.
After several weeks
of negotiation with States, Mattel agreed last week to a supplemental
nationwide distribution of $3.95 million in toys. Iowa's share is about
one percent, over $41,000.
The additional 5,228
toys for Iowa were delivered to the U.S. Marines "Toys for Tots"
distribution center in Des Moines late last week. The toys include some
of the most popular Mattel products - 1,157 "Friends of Barbie Very
Velvet Teresa," 642 "NBA Poster Puzzle Assortments," 498
"Pooh Make and Take Puzzles," and about a dozen other types
The shipment adds
to thousands of toys already provided to Iowa this season by other defendants
in the case - especially Toys 'R' Us, which provided about $9 million
in toys to the States this season. Toys 'R' Us agreed last May to pay
$40.5 million to the States in cash and toys over three holiday seasons
starting this year.
Attorney General Tom
Miller said the multi-state lawsuit, which was settled May 25 in federal
court in Brooklyn NY, alleged that Toys 'R' Us had sought to limit the
competitive threat posed by low-margin, low-price warehouse clubs, such
as Sam's Club. The suit alleged that Toys 'R' Us -- which sells billions
of dollars of toys every year and has about ten stores in Iowa -- used
its market power to make illegal agreements with the toy manufacturers
to restrict toy types they would make available to warehouse clubs. States
argued the result was that toys available to the clubs were more expensive,
and that consumers found it hard to compare prices between the clubs and
Toys 'R' Us.
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