BEIJING (AFP) — A Chinese province is likely to join a planned libel suit against US giant Mattel, accusing the toy maker of harming the region's reputation, state press said Tuesday.
The government of Guangdong province is considering the suit after Mattel issued a safety recall on more than 21 million Chinese-made toys this summer, but later apologised saying 85 percent of the recall was due to its own design flaws, the China Daily said.
"The incident has stained the reputation of Chinese toy manufacturers and made a large number of toy factories in Guangdong lose a great deal of money," it quoted Chen Lipeng, director of the province's fair trade bureau, as saying.
"A simple apology cannot compensate for the losses."
After the highly publicised recalls, Mattel made a surprise apology to the Chinese government, saying safety concerns over the toys were due to its own design flaws and not Chinese production processes.
Chen declined to say when a lawsuit would be filed in a US court.
"The plan is still under discussion because a lot of preparatory work has to be done if we really need to file charges against Mattel," Chen said. "I do not know when a real suit can be filed."
Lida Plastic Toy Co, based in Guangdong's Foshan city, is supporting a lawsuit due to the large losses it incurred following the recall, while Chinese lawyers expect "billions of dollars" in compensation, the paper said.
"A lawsuit may help us reclaim part of our loss resulting from Mattel's actions. But it will be a long-term process," a Lida manager told the paper.
Copyright © 2009 AFP. All rights reserved. More »
