8th Circ. Backs Broad Reading Of Executory Contracts

Law360, New York (August 30, 2012, 7:32 PM EDT) -- A contract between companies that have fulfilled most but not all of their obligations to one another is executory, or able to be rejected in bankruptcy court, the Eighth Circuit said Thursday in a published decision involving a trademark licensing deal.

In a 2-1 opinion, the appeals court supported a broad reading of Section 365 of the Bankruptcy Code, which allows a bankrupt company to reject an executory contract as part of its reorganization. An executory contract is one in which each party still has important...
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