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Nabi Tablet maker Fuhu suing Toys R Us for stealing "trade secrets" used on Tabeo tablet

Posted: , by Alan F.

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Nabi Tablet maker Fuhu suing Toys R Us for stealing
Two weeks ago,we told you about a new tablet for kids being sold by Toys R Us in late October called Tabeo. Expected to be sold for $150, the 7 inch Android flavored device is being rushed out for the holiday season. The announcement by Toys R Us has led to it becoming the defendant in a lawsuit filed Monday in San Diego by Fuhu. The latter is the manufacturer of the Nabi tablet, another 7 inch Android powered device made for the kiddies. Fuhu claims that Toys R Us stole "trade secrets" from them when it sold the Nabi tablet last October.

"Toys R Us used Fuhu's trade secrets and confidential information to start selling Tabeo, which systematically attempts to replicate the Nabi experience, far earlier than Toys r Us could have done otherwise, if at all."-Fuhu's lawsuit

Last October, Toys R Us agreed to be the exclusive retailer for the Nabi tablet but Fuhu claims that the retailer failed to properly promote the device and ordered just enough units to handle a single day's sales as opposed to ordering enough for the entire holiday season. And just when Fuhu is trying to understand what happened, Toys R Us announces its own Tabeo product.

The Nabi tablet

The Nabi tablet

For now Fuhu is seeking monetary damages for the failed holiday launch and it wants the court to ban the launch of the Tabeo,which can be pre-ordered via Toys R Us. It also wants the court to order Toys R Us to turn over all Tabeo units to them. Not only is Fuhu accusing the toy retailer of all the usual goodies like fraud and breach of contract, it also complains that Toys R Us stole the Nabi's butterfly bumper, although it is not a patented design. In its filing with the court, Fuhu says that Toys R Us used its trade secrets and information to produce the Tabeo faster than it otherwise could have.

In the meantime, the Nabi2 has been released for sale in Walmart, Best Buy and Amazon. Powered by a quad-core Tegra 3 processor, the tablet costs just $200.

source: Reuters, via Phandroid

17 Comments
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posted on 24 Sep 2012, 23:24 3

1. frydaexiii (Posts: 1176; Member since: 01 Dec 2011)


Oh god, what has the world become...

posted on 25 Sep 2012, 08:08 2

13. ZEUS.the.thunder.god (unregistered)


thank Apple for showing others the way.

posted on 24 Sep 2012, 23:35 4

2. wendygarett (unregistered)


Is this site phonearena?
Or iLawArena...
I'm tired to listen all these lawsuits....

posted on 25 Sep 2012, 06:48

10. ajac09 (Posts: 1337; Member since: 30 Sep 2009)


they think its major news.. they are idiots. But its coming from a website that gives you a warning becasuse you say something wont sell yet they let others attack each other and dont seem to care.

posted on 24 Sep 2012, 23:43 1

3. VZWuser76 (Posts: 1174; Member since: 04 Mar 2010)


Where are all the guys saying they stand behind Fuhu for fighting for their ip rights, or does that only apply to apple. This is the precedent being sent by these lawsuits. Now anytime someone comes out with a competing product, someone will probably get sued. Tell me again how this will stimulate innovation?

I'd bet this has less to do with trade secrets and more to do with Toys'R'Us wanting more money in their pockets, and they get that by manufacturing it themselves. Sound familiar?

posted on 25 Sep 2012, 06:07

9. dvdmon (Posts: 3; Member since: 25 Sep 2012)


I think you are right in that the Apple lawsuit has made everyone think immediately that anyone suing another tech company it's just about copying patents or trade dress.

If you actually look at the details of this case,it's very different. Fuhu is tiny compared to Toys R Us. They gave them exclusive rights to sell their product (obviously a mistake) and allegedly TRU only ordered small quantities. We got one when it first came out in December and I actually got the last one in the store. I remember people on the Nabi Facebook page clamoring for months about when they were going to be back in stock either online or at their local TRU, Fuhu finally got tired of this, ditched TRU, and went with several respectable retailers (Amazon, Best Buy, Walmart, Target, and Gamestop) for their follow-up tablet in August, and one month later what happens? TRU comes out with their own tablet with some curious similarities to the original Nabi. The case is just one thing, but the specs of the Tabeo are almost the same as the original Nabi.

I'm sorry, but to me (and obviously to Fuhu), this smells! Could it be that TRU realized they could learn a lot from having an exclusive deal from Fuhu to help them build their own tablet, and at the same time control sales so much that they basically squashed any real momentum or success for the company, thus making them a non-player when they finally came out with their tablet?

Remember, this is not just about copying, Fuhu is suing them on a number of accounts, including fraud and breach of contract. Not everything is comprable to the big case we just saw with Apple and Samsung. The world is more complicated and companies and situations are different. Please read and research what this particular case talks about before blindly just saying it's about X or Y!

posted on 25 Sep 2012, 09:33

14. VZWuser76 (Posts: 1174; Member since: 04 Mar 2010)


And what about what you are doing? Fuhu is accusing them of fraud and breach of contract, but at this point it's an accusation only. Where does it say how many units TRU had to buy? It says that they bought enough for the holiday season, so that probably was enough to legally satisfy their contract.

The whole point of my post was you don't see all the usual people who say blindly stand behind company x here defending this in the same manner.

posted on 26 Sep 2012, 06:51

16. dvdmon (Posts: 3; Member since: 25 Sep 2012)


Sorry, I meant to comment on the thread in general not specifically to your post. You're right we don't know the details of their agreement, however it sounds from the suit like Toys R Us had potential to sell 20K units per day, at least, but in the end only agreed to sell 20K units for the entire season. At least that's the claim that Fuhu is making.

My argument is only that people see the part about "copying" and equate it to Apple vs. Samsung because that was about copying and it was also about two hardware manufacturers. So there's a bit of a similarity but I believe it's only on the surface. It should be a very interesting case to watch, in any case!

posted on 25 Sep 2012, 00:11

4. OptimusOne (Posts: 694; Member since: 22 May 2012)


i want a tegra3 tablet for 200 :(

i just need play store...

posted on 25 Sep 2012, 00:49 1

5. SkOne (Posts: 87; Member since: 02 May 2012)


nexus 7?

posted on 25 Sep 2012, 00:57

6. Ragnarockd (Posts: 47; Member since: 27 Aug 2012)


suing has become an contagious disease or what...

posted on 25 Sep 2012, 03:49

7. pikapowerize (banned) (Posts: 1869; Member since: 03 May 2012)


oh lawsuits!

posted on 25 Sep 2012, 05:23

8. CX3NT3_713 (Posts: 1649; Member since: 18 Apr 2011)


Great for hacking,,, just needs ext sdcard

posted on 25 Sep 2012, 14:08

15. downphoenix (Posts: 2266; Member since: 19 Jun 2010)


The Nabi2 actually has SD Card slot. If you want a cheap Tegra 3 tablet with an SD card slot, not a bad one to go with.

posted on 25 Sep 2012, 06:49

11. ajac09 (Posts: 1337; Member since: 30 Sep 2009)


soo they stole what? the square design?

posted on 26 Sep 2012, 06:57

17. dvdmon (Posts: 3; Member since: 25 Sep 2012)


From what I have heard Fuhu mentions the bumper case and preinstalled apps. The preinstalled apps I think is a lot weaker than the bumber. The bumper on the Tabeo, while a different color, is very similar in shape to the Nabi's "butterfly" design - basically flared corners. The Tabeo, from what people have noticed from the specs and appearance, seems to be a rebranded Archcos Childpad, and one way they rebranded it was by adding a bumper very similar to the Nabi's.

Aside from those two features, there might be a lot of other small details that haven't come out quite yet. Remember that the Nabi was the first tablet specifically designed for kids, with a "kids mode" and a parent mode, parental controls, etc. Some of this stuff is somewhat obvious, but a lot not.

To me this just smacks totally of conflict of interest, if you believe that TRU had plans all along to come out with the Tabeo. If they didn't, then essentially they created a tablet from scratch in the 8 months between the time that they ended their agreement with Fuhu and unveiled the Tabeo. That's damn good for any company, let alone one with NO experience creating devices, wouldn't you say?

posted on 25 Sep 2012, 07:47

12. ibap (Posts: 681; Member since: 09 Sep 2009)


A trade secret is something that is not patented, but closely held within a company. Something like that stupid bean commercial with the dog. Unless they found an employee that talked, or TRU broke into their facility, they can't have stolen a trade secret.

That doesn't mean that TRU handled the initial agreement in good faith, and they might have a basis for a lawsuit over that. But "trade secret"? I don't think so. And that also means that Fuhu was not smart about their agreement with TRU in the first place.

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