Misha, the Moscow bear was one of the biggest losers in the history of Olympic licensing. It wasn't the product. "Being in the stuffed toy business and knowing the strength of bears, I felt that it would be a sure winner," says Harold A. Nizamian, president of R. Dakin & Co. "It was a very charming and appealing design. And it wasn't the licensee; Dakin, a San Francisco-based company with sales of around $75 million annually, had been in business for 25 years. It was politics.

In December 1979, the Soviet Union invaded Afghanistan, and, a few weeks later, President Jimmy Carter announced that the U.S. would boycott the Moscow summer Olympics. What had been a $4 million opportunity became, overnight, a $500,000 disaster.

Dakin's prior experiences with the Olympics had yielded mixed results: It had manufactured Waldie, a rainbowcolored dachshund, and a "very successful" item, for its German distributor, which held the rights to the mascot for the Munich games in 1972. Subsequently, Dakin bid on the Montreal games but decided not to pursue the license, because it felt the design lacked sales appeal.

When Misha was spotted in a newspaper, Dakin's hope prevailed over reservations. Dakin contacted lmage Factory Sports Inc., the Los Angeles company in charge of licensing arrangements, and purchased the rights to Misha for "several hundred thousand" dollars in guaranteed royalties. Misha made its debut in February 1979. "It was extremely well done," Nizamian recalls. "The Russians were delighted and tried to buy it from us. They wanted to pay us off in vodka and bedsheets, but I said that we'd prefer a letter of credit."

By December, Dakin was producing 240,000 bears a month, and seemed well on its way to meeting its sales projections. Then the Soviets arrived in Kabul. "We halted production immediately," says Nizamian. "We waited a week or two to see what was going to happen, and, when the boycott took place, we stopped production completely." Orders were soon canceled, and Dakin found itself holding $1 million in inventory that couldn't be sold.

Misha, a cherubic bear wearing an Olympic belt, had become a symbol of Soviet aggression. What to do? Nizamian decided to give the bear a new nationality and a new lease on life. He removed the belt and reintroduced Misha in an assortment of T-shirts. "I Am Just A Bear," one read; another proclaimed "U.S.A. Olympic Hockey Bear," trading on the stunning victory by the United States at the winter Olympics. "It moved fairly well," he explains. "We were able to dispose of about half of our stock by using that vehicle." Dakin donated another 100,000 bears to the Special Olympics, a competition for handicapped children, and sold the final 100,000 to liquidators.

Misha wound up costing Dakin about $500,000.

But hope springs eternal in a businessman's breast, and, when it was announced that the 1984 Olympics would be held in Los Angeles, Nizamian quickly put in a bid on its mascot, Sam the Eagle.

"We had intended to take out insurance this time," Nizamian concedes. This time, though, the license went to another company.