No, Chinese dolls are not invading. Whew!

The fight in hand has been running here in America, between California-based toy makers Mattel Inc. and MGA Entertainment Inc. A breakthrough was made Wednesday (Dec. 3) by U.S. District Judge Stephen Larson, who barred MGA from manufacturing or selling its popular Bratz dolls.

Earlier this year, a federal jury found that designer Carter Bryant came up with the Bratz doll while working for Mattel under an exclusive agreement and awarded Mattel $10 million for copyright infringement and $90 million for breach of contract.

Mattel's classic Barbie dolls have been losing market share to MGA's edgy Bratz dolls since their launch seven years ago. It's got to be tough for Mattel, as the overall doll market has been shrinking in the same time. The New York-based Toy Industry Association said doll sales in the U.S. dipped 8 percent from October 2007 through September 2008.

The LA Times quoted court papers in saying that MGA has said that losing the Bratz dolls would be "lethal" for the company.

Larson said his order won't go into effect until after he has ruled on both sides' post-trial motions. A hearing on those motions is set for Feb. 11.

MGA said it has so far made $405.4 million on the Bratz line, but Mattel claimed it was as much as $777.9 million. Both companies have spent lofty amounts in legal fees on the case -- nearly $30 million in the first three quarters this year for Mattel, according to Bloomberg.

MGA bought rotational molder Little Tikes in 2006 from Newell Rubbermaid Inc. and put Little Tikes' plant and offices in Hudson, Ohio, on the block in February 2008.

It's not surprising that both Barbie and Bratz dolls are made in China -- most likely in the same factories. Back in 2006, U.S.-based China Labor Watch and the National Labor Committee revealed that Bratz dolls were manufacturered by Chinese workers who were made to work 94 hours a week and denied access to injury and health insurance. In response, MGA CEO Issac Larian said in a statement that MGA used "first-rate factories in the orient" and that "the same factories make products for the world's biggest toy manufacturers, including Mattel and Hasbro."