Hasbro Will Donate Toys to Help Settle Suit

Hasbro Inc. agreed to donate $3.57 million worth of toys to needy children and pay $2.38 million in cash in a partial settlement of an antitrust suit against major toy manufacturers and Toys R Us Inc., state attorneys general said Thursday.

Under the settlement pact with 44 states, Puerto Rico and the District of Columbia, Hasbro will supply the toys to all 50 states through the Marine Corps’ Toys for Tots program, which distributes toys to the needy.

Hasbro, whose products include Playskool toys and Milton Bradley games, will pay most of the cash to the plaintiff states, including California, to cover legal fees and to fund programs for children, a spokesman for New York state Atty. Gen. Dennis Vacco said.

Hasbro, the No. 2 U.S. toy maker, has not admitted wrongdoing in the case. The $5.95-million settlement amounts to about 10% of Hasbro’s net profit through the first nine months of 1998.

The states sued leading toy retailer Toys R Us, Hasbro, Mattel Inc. and Little Tikes Co., a Rubbermaid Inc. unit, last year, alleging that they withheld toys from low-margin warehouse stores that undercut Toys R Us prices.

Vacco said in a statement that the settlement with Hasbro had no effect on the continuing case against the three other companies.

“We are happy to have this matter resolved quickly and with children as a beneficiary,” Wayne Charness, senior vice president at Pawtucket, R.I.-based Hasbro, said.

New York filed the suit in November 1997 in U.S. District Court for the Eastern District of New York and was later joined by other states.

Hasbro’s stock declined 94 cents to close at $34.19 on the American Stock Exchange.