Toys R Us has been sued for allegedly stealing tablet computer trade secrets.
Fuhu, the Los Angeles-based creator of the children's Nabi tablet, is accusing the toy store chain of copying its design, use experience, and online services with its own Tabeo tablet.
The suit, filed in a San Diego federal court on Monday, aims to stop Toys R Us from selling its recently announced Tabeo device ahead of the upcoming holiday season.
Fuhu actually started selling its Nabi tablet exclusively at Toys R Us in November. But Fuhu said Toys R Us put little effort into promoting the product, and instead spent that time stealing details from the Nabi for its own tablet. Fuhu is accusing Toys R Us of fraud, breach of contract, unfair competition, and trade secret misappropriation.
A Toys R Us spokeswoman said that the company is in the process of reviewing the filing, and declined to comment further on the lawsuit.
Fuhu's complaint says the two companies met 13 times between October 2011 and January 2012 to discuss exclusive distribution rights, the retail launch, and terms of exclusivity, during which explicit design and sales plans were discussed – the same plans Fuhu believes Toys R Us ripped off with the Tabeo. Even the butterfly-shaped bumper case used to protect the Nabi (which means "butterfly" in Korean) is similar to the Tabeo, Fuhu said.
The toy retailer sold Fuhu's product for $199 (£123), while the Tabeo carries a $149.99 (£93) price tag, and runs on Android 4.0 Ice Cream Sandwich, with a 7in multi-touch screen, front- and rear-facing camera, 4GB of memory, Wi-Fi access, and an HDMI port.
Beyond simply requesting that Toys R Us stop selling its Tabeo, Fuhu is asking that all of the tablets be turned over to Fuhu. Fuhu is also seeking unspecified monetary damages.
Fuhu, owned in part by Taiwanese computer maker Acer, gadget manufacturer Foxconn, and memory chip producer Kingston, turned from Internet software provider to tablet maker in November, and immediately began churning out the Nabi tablet for sale at Toys R Us and Babies R Us. The next-generation Nabi 2 was introduced this summer.