HP-2020-000016 - [2025] EWHC 1451 (Ch)

Isaac Larian is the founder and CEO of MGA, and the main protagonist in the events of 2017 which form the subject-matter of this claim. He was therefore the main witness for MGA. He provided, prior to the trial, four witness statements, and was cross-examined over two days. His evidence was defensive and argumentative throughout, attempting to give speeches as to the evidence in the case rather than answering the questions put to him (to the extent that he had to be repeatedly reminded to address the question rather than trying to put his case). His mantra that a retailer stocking a “knock off” did not need the original product was repeated at least seven times during his cross-examination, frequently as a means to avoid giving a straight answer to the question put to him. He repeatedly refused to give proper (or any) answers to questions, instead making implausible denials or simply responding “no comment”. By the second day of his cross-examination he was increasingly irascible, giving irritated and facetious answers.

On the basis of the content and manner of Mr Larian’s evidence during this part of the trial, I regret to say that I considered Mr Larian to be an unreliable witness who was less than candid in his evidence to the court. That impression was reinforced by Mr Larian’s multiple breaches of purdah between the first and second days of his evidence, and the subsequent evidence that he gave when recalled to be cross-examined on this point, which I address below. My conclusion is that I can give no weight to Mr Larian’s evidence where it is not corroborated by the contemporaneous documents or the evidence of other more reliable witnesses.

Andrew Laughton was, during the events at issue in these proceedings, the managing director and senior vice president of MGA. He was a central figure in the implementation of MGA’s conduct in relation to Worldeez, acting as Mr Larian’s mouthpiece and enforcer. Numerous of the communications relied on by Cabo as constituting infringements of the competition rules and unjustified threats of patent infringement proceedings emanated from Mr Laughton, whether in the form of emails or telephone calls to retailers. Mr Laughton was therefore a central witness for MGA. He provided three witness statements and was cross-examined for a little less than a day. He sought to give the impression of being unwillingly caught in a conflict between Mr Larian and the retailers, with a rather grandiose suggestion that he played the part of a “Kofi Annan” peacemaker. In reality, it was apparent from the contemporaneous documents that he was a willing and proactive participant in Mr Larian’s conduct. His answers to questions about the events of 2017 wereoftenevasive, seeking to play down the impact of his communications with the retailers. I do not regard Mr Laughton as an entirely reliable witness, and have treated his evidence with caution.

Alexander Lazarus is one of the two founders and directors of Singleton Trading Limited (Singleton), a successful toy company which sells “close-out” stock to toy retailers, and the related company Sinco Toys Limited (Sinco), a licensing and distribution business. His business partner in both companies is Marc Sivner, who is Mr Michaelson’s cousin. Mr Lazarus and Mr Sivner were initially shareholders in Cabo, alongside the Cabo founders, and Singleton provided both financial backing and logistical support for the launch of Worldeez. Mr Lazarus provided two witness statements, addressing Singleton’s involvement with Cabo, the development of the Worldeez product, the launch of Worldeez and MGA’s reaction, and the subsequent demise of Worldeez. He was cross-examinedfor almost a day, and his evidence was, in general, objective and candid. Cabo contended that Mr Lazarus’ credibility was undermined by the fact that Sinco entered into a licensing agreement with MGA in 2018, while Mr Sivner and Mr Lazarus were still directors of Cabo. It is fair to say that when Mr Lazarus was questioned about that agreement, his answers were somewhat defensive. Ultimately, however, the Sinco licensing agreement has no bearing on the facts relevant to the present proceedings; and in relation to the events material to these proceedings Mr Lazarus’ evidence was both measured and corroborated by the contemporaneous documents.

Stuart Grant is a shareholder and director of The Entertainer, a family-owned toy business founded by his parents Catherine and Gary Grant. The Entertainer was one of the toy retailers threatened by MGA, and during that period Stuart Grant was the company’s buying director. Stuart Grant provided three witness statements describing The Entertainer’s initial order of Worldeez, MGA’s intervention, and The Entertainer’s subsequent decision not to stock the globe. He was cross-examined for around half a day, and was a straightforward witness, giving measured and candid responses. I consider him to be a reliable witness on the factual issues in dispute, albeit that (for the reasons discussed below) I do not entirely accept his characterisation of The Entertainer’s decision not to stock the Worldeez globe.

Hayley Whiteis (and was, during the relevant period of time) the toy buyer at the retailer B&M Retail Limited (B&M). She provided a short witness statement describing B&M’s sales of Worldeez during 2017 and its relationship with MGA in 2018. She was cross-examined very briefly, and was a straightforward and candid witness.

Darran Garnham is the founder and CEO of Toikido Limited, an entertainment company specialising in digital design and toys. He gave some advice to the Cabo founders and Singleton on the design of the Worldeez product in 2016, and provided a witness statement responding to the Cabo founders’ evidence about their discussions with him during that period. He was cross-examined very briefly, and his evidence was straightforward and entirely credible.

John Hunter is a director and co-owner of AB Gee of Ripley Limited (AB Gee), a toy wholesaler which supplies smaller independent toy retailers. He provided a short witness statement addressing AB Gee’s position in the toy market, its sales of Worldeez and its interaction with MGA regarding the sale of Worldeez. MGA then issued a witness summons to compel Mr Hunter’s attendance at the trial. His (brief) cross-examination was interposed at the start of the second day of Mr Michaelson’s cross-examination, and his evidence was entirely straightforward.

Kathy Brandon is vice president of research and consumer insights at MGA. She provided a short witness statement to explain two viability studies conducted by MGA in 2017 and 2018, addressing the girls’ collectibles market (with the focus apparently being on the US market) and MGA’s products in that market. She was not cross-examined, but it was agreed that her evidence was admissible as hearsay evidence, and should be given the same weight as if she had been called and given evidence in court.

Nicholas Pimlott is one of the partners at Fieldfisher with primary conduct of the case for MGA. He provided a very short witness statement recording a telephone call with Sally Hunter, who was the sales director at Sinco between July 2017 and March 2018, and subsequently worked at MGA. She had provided information to Mr Pimlott regarding the sales of Worldeez during the time of her employment at Sinco, but was not thereafter willing to give evidence in these proceedings. Mr Pimlott was not cross-examined on his witness statement and nothing ultimately turned on his evidence.

Patrick Smyth is the co-founder and a director of Smyths Toys (Smyths). He provided two witness statements referring to his interactions with Cabo regarding the purchase of Worldeez, and denying that MGA had pressured him to drop the product. Shortly before the trial was due to start, Mr Smyth said that he was no longer able to attend court. It was therefore agreed that his evidence was admissible as hearsay, but I have treated it with appropriate caution where his account was inconsistent with the contemporaneous documentation and other witness evidence.