IP Licenses in Bankruptcy: Navigating Sec. 365 and Divergent Circuit Rulings

Strategies for Licensees and Licensors to Protect IP Interests

Recording of a 90-minute premium CLE webinar with Q&A

Conducted on Tuesday, December 10, 2013

Recorded event now available

or call 1-800-926-7926
Course Materials

This CLE course will provide IP licensor, licensee and bankruptcy counsel with a thorough briefing on the Bankruptcy Code provisions governing IP licenses. The panel will analyze the issues from all perspectives, discuss key recent court decisions, and outline best practices for dealing with IP licenses and trademarks in a bankruptcy.


The Bankruptcy Code has a significant impact on the enforceability of IP license agreements. Challenges arise in the context of assumption, assignment or rejection of executory IP licenses. The rules are complex and differ according to whether the debtor is the licensor or licensee.

Bankruptcy Code Section 365 gives the licensee the right to retain license rights even if the debtor/licensor rejects the license agreement, but that is just the beginning of the hotly contested issues for IP counsel.

Counsel must also understand the nature of the circuit conflict initiated by the Seventh Circuit's decision in Sunbeam Prods v. Chicago Am. Mfg., its departure from Lubrizol,  and the implications for a trademark licensee when the licensor becomes a debtor in bankruptcy.

Practitioners must help debtor licensees and licensors determine the cost to the licensee for retaining IP license rights, the extent of the licensor's rights and obligations, the extent of a debtor-licensee's ability to assume or assign an IP license, and whether or not an IP license is executory.

Listen as our panel of experienced IP counsel reviews the impact of the Bankruptcy Code on IP license agreements, provides an update on case law developments, and outlines best practices for dealing with IP licenses in a bankruptcy.



  1. Overview of bankruptcy code sections applicable to IP
    1. Definitions of IP
    2. Treatment of trademarks
    3. Analysis of definition of executory contract as applied to IP licenses
  2. Debtor as licensor
    1. Analysis of Section 365(n)
    2. Licensor rejects contract
    3. Cost of licensee retaining rights
    4. Obligations of licensor
  3. Debtor as licensee
    1. Inapplicability of Section 365(n)
    2. Assignability of license
    3. Assumability of license
    4. Result of rejection


The panel will review these and other key questions:

  • What factors will courts consider in determining whether an IP license is truly an executory contract?
  • What special rights are accorded licensees under Section 365 of the Bankruptcy Code?
  • What are the continuing obligations of a debtor licensor after rejecting a license agreement?
  • Can a debtor licensee assign an IP license over the licensor's objection?
  • What are the implications of Sunbeam Prods v. Chicago Am. Mfg. for trademark licensees when the licensor becomes a debtor in bankruptcy?

Following the speaker presentations, you'll have an opportunity to get answers to your specific questions during the interactive Q&A.


Victor A. Vilaplana
Victor A. Vilaplana

Of Counsel
Foley & Lardner

Mr. Vilaplana is a member of the firm’s Bankruptcy & Business Reorganizations, International, and Latin...  |  Read More

Jason B. Binford
Jason B. Binford

Kane Russell Coleman & Logan

Mr. Binford's experience includes representation of debtors and creditors in large to mid-size Chapter 11 and...  |  Read More

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