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Note 13 - Commitments and Contingencies
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12 Months Ended |
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Apr. 01, 2012
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| Commitments and Contingencies Disclosure [Text Block] |
Note
13 – Commitments and Contingencies
Total
rent expense was $1.7 million and $1.8 million during
fiscal years 2012 and 2011, respectively. The
Company’s commitment for minimum guaranteed rental
payments under its lease agreements as of April 1, 2012 is
$3.3 million, consisting of $1.5 million, $1.4 million and
$370,000 due in fiscal years 2013, 2014 and 2015,
respectively.
Total
royalty expense was $6.9 million and $7.3 million for
fiscal years 2012 and 2011, respectively. The
Company’s commitment for minimum guaranteed royalty
payments under its license agreements as of April 1, 2012
is $5.0 million, consisting of $2.1 million, $2.9 million
and $32,000 due in fiscal years 2013, 2014 and 2015,
respectively.
BreathableBaby,
LLC (“BreathableBaby”) filed a complaint
against the Company and CCIP on January 11, 2012 in the
United States District Court for the District of Minnesota,
alleging that CCIP’s mesh crib liner infringes
BreathableBaby’s patent rights relating to its air
permeable infant bedding technology. The Company
believes that it has meritorious defenses to the claims
asserted in the complaint, and the Company intends to
defend itself vigorously against all such
claims. The Company and CCIP filed a motion for
summary judgment of non-infringement on May 14,
2012. BreathableBaby’s response was due by
June 4, 2012, and the motion is scheduled to be heard by
the Court on June 25, 2012.
On
or about May 17, 2012, an alleged Maryland purchaser of a
CCIP bedding set filed a complaint against the Company and
CCIP in the United States District Court for the Central
District of California, purportedly on behalf of herself
and all others similarly situated. The complaint
generally alleges that CCIP’s crib bumper products
put children at risk of suffocation or crib death and that
the Company and CCIP concealed and failed to disclose these
purported risks through allegedly false and misleading
advertising and product packaging. The complaint
does not allege that any child has actually been harmed by
these products. The complaint alleges violations
of various consumer protection laws in California, Maryland
and numerous other states. The purported class
is defined in the complaint as “All consumers who,
within the applicable statute of limitations, purchased
defendants’ crib bumper products or bedding sets that
include a crib bumper.” The complaint
alleges an alternative class that would be limited to
residents of Maryland. The complaint seeks
damages for the purported class in an unspecified amount,
injunctive relief, “restitution and disgorgement of
all monies acquired by the defendants by means of any act
or practice” the Court finds to be unlawful, a
Court-ordered “corrective advertising
campaign”, and an award of plaintiffs’
attorneys fees and costs. The Company believes
that it has meritorious defenses to the claims asserted in
the complaint, and the Company intends to defend itself
vigorously against all such claims.
In
addition to the foregoing civil complaints, the Company is,
from time to time, involved in various legal proceedings
relating to claims arising in the ordinary course of its
business. Neither the Company nor any of its
subsidiaries is a party to any such legal proceeding the
outcome of which, individually or in the aggregate, is
expected to have a material adverse effect on the
Company’s financial position, results of operations
or cash flows.
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