The market says that eToys management has failed, but management refuses to fully correct its behavior by dropping the lawsuit, rather than just putting it on hold. Get out now, before they totally wreck your company. The labor market in the L.A. region is very good for job seekers, especially in the high-tech occupations. It will be easy to find a better job. And in other sectors too, a change in employment is nowadays most often a change for the better.
Ethical behavior is an essential part of professionalism.
Please consider carefully the ethical implications of continuing to work for eToys. America is not a place where a very rich company should be able to use the law as it sees fit. An honest American should not work for a company that practices bullying and censorship. Even if you can't quit eToys right now, if you agree with our struggle please help us out in whatever way you can. Speak with your colleagues, find out how they feel about this.