In 1979, the year of their 25th Anniversary, Mego was facing some new challenges with their premier license the "World's Greatest Superheroes".
The boys' action figure market was steering away from the traditional 8" size that had ruled for nearly 8 years, to top it off rival toy company Remco was cutting Mego's grass by getting the Superhero license for a series of "Energized Heroes".
The Elastic Heroes were a take off on Kenner's popular Stretch Armstrong line, Kenner thought the word "rip off" was more appropriate and promptly sued.
The thing that makes the Elastic Heroes so cool, is the character choices, not only were Hulk., Spiderman, Superman, Batman in the mix but new TV star Plastic man and cartoon regulars Casper, Mickey Mouse and Donald Duck.
Original Mego Repro line art for Stretch Dolls.
Mego licensed Disney characters such as Mickey,Donald Duck and Casper.
Original Mego 1979 Catalog Page for the Elastic Heroes and a picture of a Kaybee toys circa the early 1980's. If you look close enough, you can see an entire display of Mego Stretch Dolls.