High Court Bankruptcy IP Case May Spur Rejection Litigation

Law360 (May 22, 2019, 4:32 PM EDT) -- In Mission Product Holdings Inc. v. Tempnology LLC,[1] the U.S. Supreme Court ruled that the rejection of an executory trademark license under Bankruptcy Code Section 365 does not bar the nondebtor licensee from continuing to use the trademark post-rejection:

The question is whether the debtor-licensor’s rejection of that contract deprives the licensee of its rights to use the trademark. We hold it does not. A rejection breaches a contract but does not rescind it. And that means all the rights that would ordinarily survive a contract breach, including those conveyed here, remain in place.[2]

With this ruling by the Supreme Court,...

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