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IP Licenses in Bankruptcy: Navigating the Circuit Split After Tempnology

Strategies for Licensees and Licensors to Protect IP Interests Under the Code

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

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Conducted on Thursday, July 26, 2018

Recorded event now available

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This CLE course will guide IP licensor, licensee and bankruptcy counsel on the impact of the Bankruptcy Code on IP license agreements. The panel will examine the recent First Circuit Court of Appeal’s decision creating a circuit split as well as other recent cases. The panel will analyze the issues from all perspectives and outline best practices for addressing IP licenses in bankruptcy proceedings.


When Congress codified the Bankruptcy Code §365(n), its chosen definition of intellectual property in §101(35) included patents, trade secrets and copyrights, but failed to include trademarks, leaving interpretive challenges to the courts.

Seventh Circuit rulings permit trademark licensees to continue using licensed trademarks in bankruptcy. However, the First Circuit’s recent decision in Mission Product Holdings Inc. v. Tempnology (1st Cir. 2018) does not follow the Seventh Circuit’s approach.

The First Circuit held that the Bankruptcy Code does not “contain any catchall or residual clause from which one might infer the inclusion of properties beyond those expressly listed,” and the Code definition of IP does not include trademarks.

Practitioners must navigate this circuit split as they assist companies that receive a license from debtor-licensors in determining the extent of such licensee’s rights and obligations.

Separately, additional questions have emerged in recent years as to the ability of a debtor-licensee to assume or assign an IP license, and whether or not an IP license is executory and can be rejected by a debtor-licensor.

Listen as our authoritative panel examines the impact of the Bankruptcy Code on IP license agreements, reviews the First Circuit’s opinion in the Tempnology case and discusses the circuit split it created. The panel will also provide insights for dealing with IP licenses in bankruptcy proceedings.



  1. Impact of Bankruptcy Code on IP license agreements (rejection, assumption and assignment, retention of license rights)
  2. Treatment of trademarks
  3. Analysis of definition of executory contract as applied to IP licenses
  4. Debtor as licensor
  5. Recent court treatment and circuit split
    1. Mission Product Holdings Inc. v. Tempnology LLC (1st Cir. 2018) and similar court cases
    2. Sunbeam Products (7th Cir. 2012) and similar court cases
  6. Debtor as licensee
    1. Ipso facto clauses
    2. Assumption and assignment


The panel will review these and other high priority questions:

  • What are the implications of Mission Product Holdings Inc. v. Tempnology for trademark licensees when the licensor becomes a debtor in bankruptcy?
  • What special rights are accorded licensees under Section 365(n) 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?


Barefoot, Luke
Luke A. Barefoot

Cleary Gottlieb Steen & Hamilton

Mr. Barefoot’s practice focuses on bankruptcy litigation, insolvency, corporate restructuring and related...  |  Read More

Ilan, Daniel
Daniel Ilan

Cleary Gottlieb Steen & Hamilton

Mr. Ilan’s practice focuses on intellectual property law, as well as cybersecurity and privacy. He has...  |  Read More

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