I'm not a major fan of the new name as the -ables in Tykables makes it feel more like some sort of packaged snack product and doesn't really scream "Diaper" to me. Though I will admit that I'm much more comfortable with the name now than I was a couple days ago when it was first announced, so it's growing on me.
As for the lawsuit, I personally don't agree with it. I don't think the name Snuggies would've effected Huggies or their profits at all. I'm pretty sure that 99.9999% of Huggies customers have never heard of Snuggies and would give you a WTF look if you brought up Snuggies or think you're talking about the infomercial blanket, and my jaw would drop, hit the floor, and shatter in a million pieces if Snuggies EVER showed up in a Google Search for Huggies. If I were a judge ruling, I would definitely side with Snuggies.
However, I don't blame Tykables for the name change one bit considering the fact that Kimberly Clark is a Fortune 500 Company, Snuggies/Tykables is a tiny little business catering to a niche market, they probably have lobbyists in D.C, and the fact that Kimberly Clark probably has more people working for them just as lawyers than the entire Tykables company hires total. If Huggies was a small business not worth very much and without much power, I'd feel comfortable in Snuggies winning the suit. But knowing how friendly and favorable the U.S Court System is to major companies, going up against a corporation worth billions of dollars that most people know about, Snuggies would've gotten crushed if they didn't go bankrupt from legal fees before the ruling.