Vol 16 (2019) - Issue 3

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Does the US Bankruptcy Code Protect Trademark Licensees? In re Tempnology, LLC May Provide an Answer

Synopsis

Section 365(n) of the US Bankruptcy Code ('Bankruptcy Code') provides certain protections to a licensee of intellectual property rights if such licence is rejected by the debtor – namely, to (i) treat the licence as terminated and assert a claim for pre-petition damages, or (ii) retain its intellectual property rights under the licence. Trademarks, however, are not included in the definition of 'intellectual property' under the Bankruptcy Code, and there is currently a circuit split as to whether trademark licensees can benefit from the Bankruptcy Code’s protections if their licence is rejected by a bankrupt licensor. The uncertainty may soon be resolved by the US Supreme Court, which granted certiorari in the case Mission Product Holdings, Inc. v Tempnology, LLC (In re Tempnology, LLC).