In November 2022, Kelly Toys had sued around 90 merchants accusing them of selling counterfeit Squishmallows, and got an injunction two months later. The company added Alibaba as a defendant in March.

Furman did not rule on the lawsuit's merits. Kelly Toys had in November 2022 sued about 90 merchants it accused of selling counterfeit Squishmallows, and obtained an injunction two months later.