Austin Startup Gel Blaster Sued Toy Giant Hasbro

Gel blasters, bead blasters, and gel bead blasters all belong to a category of toy that is now seen as problematic. But they did not make huge waves until an increase in popularity thanks to companies like Gel Blaster and SplatRball, which launched in 2020. Now, though, the Austin startup Gel Blaster has sued toy giant Hasbro over the alleged breach of confidentiality agreements and the theft of trade secrets.

The controversy surrounding gel blaster toys is that many of them are designed to look realistic. The realistic look has caused several tragic deaths and incidents with the police. It has led to bans in some places.

Not every company makes realistic-looking gel blasters, though. Gel Blaster creates products that are obviously toys, and it might have played some role in the company’s breakthrough success in the US.

But the success shown by Gel Blaster seems to be what connected the company to Hasbro and led to the current situation.

Allegedly, Hasbro approached Gel Blaster about a potential partnership, which made it all the way to the drawing up of a confidentiality agreement. The agreement was meant to allow Gel Blaster to share information about its products. Gel Blaster also allowed Hasbro reps to sit in on a meeting with Walmart and visit its manufacturer to get a complete overview of the process and potential.

However, before cooperation could occur, Hasbro launched its own Nerf-branded gel blasters and filed a complaint with the International Trade Commission (ITC). In the complaint, Hasbro claimed it was the exclusive licensee of the existing patents that the two companies discussed previously.

The unexpected complaint prompted Gel Blaster to file a lawsuit, which accuses Hasbro of breaking the confidentiality agreement after finding out key details. It also claims that the toy giant realized just how big the profits could be after the meeting its reps attended between Walmart and Gel Blaster.

“Hasbro has used and is utilizing the confidential product designs and specifications, financial information, client information, and business plans, to pursue the ITC complaint against Gel Blaster, all in an effort to prohibit Gel Blaster from importing its products into the United States and to gain significant business advantage for Hasbro.”

Another reason Gel Blaster sued Hasbro is that the toy giant allegedly took the news of the infringement to Costco in an attempt to “stamp out Gel Blaster’s business.”

A lawyer for Gel Blaster summed it up by saying, “In a glaring act of deception, bad faith and betrayal, Hasbro secretly began a cynical corporate scam to unlawfully crush Gel Blaster.”

Hasbro denied many of the allegations in a court filing, even countering that Gel Blaster infringed on its trademarks for advertisement alongside the patent infringements.

Who is in the wrong is not clear, but one thing that is clear is that there is a lot of money and limited shelf space up for grabs. That is what makes the David versus Goliath story worth watching — to see whether the small Austin-based startup Gel Blaster will be able to hold its own against the toy behemoth that is Hasbro.