Posts Tagged: "Justice Elena Kagan"

In Mission Product Ruling, Supreme Court Clarifies Longstanding Circuit Split on Effects of Bankruptcy on Trademark Licenses

As predicted, the U.S. Supreme Court has ruled that a debtor’s rejection of a license agreement in bankruptcy proceedings does not mean the licensee no longer retains rights to the mark. Instead, the Court said that rejection of the contract – and therefore the trademark license – constitutes a breach of the contract/ license, not a revocation. In Mission Product Holdings, Inc. v. Tempnology LLC, the High Court was asked to determine whether a trademark licensor’s rejection of a licensing agreement during bankruptcy proceedings terminates the rights of the licensee which would otherwise survive a licensor’s breach of contract under applicable non-bankruptcy law. In an 8-1 decision, the Court held that the rejection of an executory contract during bankruptcy has the same effect as breach of that contract outside of bankruptcy and thus cannot rescind rights previously granted by the contract. As a result, Tempnology’s rejection in bankruptcy of its agreement to license trademarks to Mission Product Holdings didn’t rescind Mission’s rights to continue using those trademarks.

Mission Product: SCOTUS Appears Skeptical That Bankrupt Licensor’s Rejection of Trademark License Means Licensee Can’t Use the Mark

On Wednesday, February 20, the U.S. Supreme Court heard oral arguments in Mission Product Holdings, Inc. v. Tempnology, LLC, where the Court was asked to address one of the most important issues at the intersection of trademark law and bankruptcy law: whether a debtor-licensor’s rejection of a trademark license terminates the rights of the licensee to use that trademark. Taking seriously the language of the question presented, and generally acknowledging that 11 U.S.C. § 365(g) provides that rejection constitutes a “breach” of the contract, the justices focused on the remedies for breach outside of bankruptcy law and whether, because trademarks (and quality control issues) are involved, deviation from ordinary, contract law principles is warranted. Both the advocates and the justices returned to whether analogies, including with respect to breaches of apartment and photocopier leases, are apposite. The question of whether the case was moot also received some attention, though it seems unlikely that the case will be dismissed on that ground.

Supreme Court Weighs Meaning of ‘Full Costs’ in Rimini Street v. Oracle USA Oral Arguments

On the morning of January 14th, the U.S. Supreme Court heard oral arguments in Rimini Street v. Oracle USA, a case that asks the nation’s highest court to decide whether the recovery of “full costs” in a copyright infringement suit as governed by 17 U.S.C. § 505 is limited to taxable costs under 28 U.S.C. § 1920 and 28 U.S.C. § 1821 or whether non-taxable costs can also be recovered. Much of the day’s discussion centered on the meaning of “full costs” and how that term had evolved under various revisions of U.S. copyright law, going back to the Copyright Act of 1831… Clement argued that Rimini Street’s interpretation of full costs renders both the word full completely superfluous and the first sentence of Section 505 without any meaning. “The better course [is] to say that ‘full’ means full, rather than nothing at all,” Clement argued.