UCLA health system sues Mattel for pledging $49M to children's hospital named after toy giant, 'then trying to back out of deal and offer sick children BARBIES instead'

The University of California Los Angeles is suing toy manufacturer Mattel over claims it pledged to donate $49million to its children's hospital before trying to back out. 

It filed a lawsuit last week accusing the company behind popular toys like Barbie, Hot Wheels and American Girl of breach of contract, according to the Los Angeles Times. 

The two organizations have worked together since 1998 when the toy manufacturer donated $25million to the UCLA Foundation to help build the medical facility on the Westwood campus and it was named after the company. 

UCLA claims Mattel agreed to donate $49million over 12 years to the UCLA Mattel Children’s Hospital back in 2017.

It alleged Mattel has tried to offer 'just a few million dollars, plus a bunch of Barbie dolls, Hot Wheels cars and other in-kind donations' instead of fulfilling the full pledge. It is seeking the original amount as well as damages for financial difficulty. 

The lawsuit was filed on behalf of UCLA and the UCLA Foundation and accuses Mattel of reneging on the agreement reached five years ago. 

It allegedly promised to donate $49million over 12 years in a deal which saw the university agree to work the toy manufacturer's logo into the signage for the hospital.

The lawsuit states that this corporate branding was an unprecedented move for the university facility.

Mattel allegedly first donated $2million in 2017 as agreed but provided only a third of what it was supposed to the next year. 

'Mattel paid just $1 million of the $3 million promised,' according to the court filing. 

'That $1 million payment was the last one Mattel made.' 

The lawsuit claims that in 2018, Mattel Chief Executive Ynon Kreiz told UCLA in writing that the manufacturer's board put a three-year pause on donations due to the company's bad financial position. Mattel had recorded more than $1billion in losses in 2017. 

UCLA claimed that when the donations were supposed to resume in 2021, the company wrote to say it planned to provide just $10million more instead of the $46million left under the original pledge. 

Mattel allegedly clarified that only $2.5million would be cash and the rest would be made up of $5million of in-kind marketing and $2.5million in toys. 

'As a last resort, UCLA Health has taken legal action to compel Mattel, Inc. to honor its $49 million pledge under a 2017 contractual agreement. Litigation is not the University’s preferred path, a UCLA spokesman said. 

'UCLA Health made multiple good faith attempts to resolve this matter through meaningful dialogue, and those efforts were unsuccessful.

'In 2018, UCLA Health agreed to Mattel, Inc.’s request to temporarily suspend scheduled payments on the pledge. 

'UCLA Health is disappointed that the company since then has repeatedly declined to renew the payments, including in 2021 when the Mattel, Inc. reported a net income of more than $900 million.' 

But Mattel disputed the claims and said conditions for the pledge had not been met by UCLA. 

'Mattel deeply values its longstanding relationship with UCLA Health and we are proud that UCLA Mattel Children’s Hospital bears our company’s name,' a spokesman for the toy manufacturer said. 

It added that the donation was specifically for the construction of a new tower in the children's hospital.

Mattel claimed that because the university 'unilaterally abandoned its plans for the construction of its new hospital tower', the conditions of the pledge had not been met. 

'We are open to continuing a dialogue with UCLA Health in the same spirit of collaboration that has been a hallmark of our relationship for decades,' it added. 

The company also insisted that it is continuing to support the children's hospital through 'fundraising, toy, cash and in-kind donations, and community activations' as it is 'important to the company'. 

UCLA and Mattel have been in partnership since 1998 and thousands of children have been treated at the hospital since.  The company delivered all of the agreed upon initial $25million donation by 2004. 

It has hosted an annual Party on the Pier fundraiser for the hospital at the Santa Monica Pier, which is said to have raised over $1 million in 2022.

Mattel has made more than $1.3billion in profit since 2021, according to financial reports. 

DailyMail.com has contacted Mattel and UCLA for comment.