The Supreme Court yesterday handed down its decision in Mission Product Holdings Inc. v. Tempnology LLC, 17-1657 (Sup. Ct.), reversing the First Circuit and held that rejection of an executory trademark license does not bar the licensee from continuing to use the mark, according to a special analysis from ABI Editor-at-Large Bill Rochelle. As Justice Elena Kagan said, “A rejection breaches a contract but does not rescind it.” The opinion was almost unanimous, with Justice Neil M. Gorsuch dissenting; he believes that the petition for certiorari should have been dismissed as improvidently granted. In his view, the Court could not grant effective relief. Justice Sonia Sotomayor wrote a concurring opinion to say that nondebtor parties to rejected trademark licenses may have more rights following rejection than parties to other types of intellectual property licenses whose rights are limited by Section 363(n). The Court granted certiorari in October to resolve a split of circuits. Click here to read the full analysis.
A special ABI Podcast is being recorded this week to examine the Supreme Court’s decision in Tempnology. Bill Rochelle will be joined by Bankruptcy Judge Kevin Carey (D-Del.; Wilmington), Paul Hage of Jaffe Raitt Heuer & Weiss (Southfield, Mich.) and Lindsay Milne of Bernstein Shur (Portland, Maine). The podcast will be released on ABI social media and included in tomorrow’s Headlines.
In addition to ruling on the effect of rejecting a trademark license, the Supreme Court yesterday agreed to review one bankruptcy case and denied a petition for certiorari in another. In Ritzen Group Inc. v. Jackson Masonry LLC, the Court granted certiorari to shed more light on what is or is not a final order conveying a right of appeal in a bankruptcy case. The justices declined to review Davis v. Tyson Prepared Foods Inc., a case that could have said whether passively holding property of the estate violates the automatic stay under Section 362(a). Click here for Rochelle's full analysis.