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In 1980, CPI, through its agent, Conan Licensing Company (“CLC”), began negotiations with Mattel regarding the possible licensing to Mattel of certain toy rights in CONAN. During this time, Mattel received a substantial quantity of material on the CONAN character. On July 31, 1981, CPI and Mattel executed a License Agreement whereby Mattel was granted “the right to make and sell certain plastic action figures of CONAN and ancillary characters as depicted in the CONAN movie. ” Amended Complaint, para. 12. The Agreement provided, however, “that nothing in the License should be construed as an assignment or grant to Mattel of any right, title or interest in or to CONAN, and that all rights relating thereto were reserved by CPI (except only for the licensee to use the property as specifically agreed to). ” Amended Complaint, para. 14. It was also agreed that, after the termination of the License Agreement, Mattel would not make or sell any CONAN toys.

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