GALOOB WINS $15 MILLION FROM NINTENDO OF AMERICA
GALOOB WINS $15 MILLION FROM NINTENDO OF AMERICA SOUTH SAN FRANCISCO, July 7 /PRNewswire/ -- Lewis Galoob Toys, Inc.
(NYSE: GAL; GALPR) announced today that it has been awarded a $15 million judgment against Nintendo of America Inc. The award represents compensation to Galoob for profits it lost for the period from June 1990, through July 1991, when Galoob was enjoined from selling its Game Genie(TM) Video Game Enhancer for the Nintendo Entertainment System(R) (NES/R/) due to an infringement lawsuit brought by Nintendo.
The award will be paid out of the proceeds of the bond that Nintendo was required to post in connection with the litigation. The timing of the actual receipt of the money is not yet determined, and will depend on such factors as whether the damage judgment is appealed. However, once collected, Galoob will retain approximately $11.5 million of the award, and share approximately $3.5 million with its Game Genie licensors, Codemasters Software Co., Ltd. of London, and Camerica Corp. of Toronto. "This award strengthens the company's financial position, which had been adversely affected by the lost opportunity to sell Game Genie for NES and the very substantial costs incurred during our successful litigation against Nintendo. The company intends to utilize its portion of the award to pay down current bank debt and to support ongoing business activities," said William Catron, Galoob's executive vice president, general counsel and chief administrative officer. He also pointed out that upon receipt of the award, the company's credit line will be reduced, on a formula basis, by an amount significantly less than the total award. The net combination of award proceeds and the revised credit line leaves the company with increased financial resources. The judgment awarded today by U.S. Ninth District Court Judge Fern M. Smith follows her July 1991, ruling that Galoob had been wrongfully enjoined from selling Game Genie for the Nintendo Entertainment System, and the U.S. Court of Appeals Ninth Circuit Court's unanimous decision in May 1992, affirming Judge Smith's ruling. "Substantial credit for all of these decisions goes to our attorney on this matter, Martin Glick, and his colleagues at Howard, Rice, Nemerovski, Canady, Robertson & Falk in San Francisco," said Catron. Galoob indicated that since Judge Smith's ruling in July 1991, it has sold more that 1.4 million units, or $50 million worth of Game Genies for NES in the United States. Shipment of Game Genie for NES in Europe began last month, and shipment of Game Genie for the Nintendo Game Boy(R) handheld system is planned to begin in the United States late this year. Galoob also announced today that United States shipment of Game Genie for the highly successful Sega(TM) Genesis(TM) will begin this month, and that international shipment will commence in the third quarter. Galoob is a licensee of Sega of America. "We are delighted with these court decisions in the Nintendo litigation, and look forward to the continuing profitable expansion of the Game Genie product line in 1992 and 1993," Catron concluded. Nintendo Entertainment System, NES and Game Boy are trademarks of Nintendo of America Inc. Sega and Genesis are trademarks of Sega of America, Inc. Game Genie and Galoob are trademarks of Lewis Galoob Toys, Inc. -0- 7/7/92 /CONTACT: William G. Catron, executive vice president and general counsel of Lewis Galoob Toys, 415-952-1678 ext. 2206, or Barry M. Schwartz of Schwartz Public Relations, 212-677-8700, or 212-664-7613, for Lewis Galoob Toys/ (GAL) CO: Lewis Galoob Toys, Inc.; Nintendo of America, Inc. ST: California IN: HOU SU:
TS-OS -- NY023 -- 6928 07/07/92 10:40 EDT
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|Date:||Jul 7, 1992|
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