Cannata, Smirti, Misiti and Gordon File Amicus Brief with U.S. Supreme Court

Earlier this week, Mike Cannata, Steve Smirti, Frank Misiti, and Stu Gordon filed an amicus brief with the U.S. Supreme Court on behalf of the New York Intellectual Property Law Association in a case styled Mission Product Holdings, Inc. v. Tempnology, LLC.  The case concerns the rights of a trademark licensee to continue to use a trademark after a licensor declares bankruptcy and rejects the license agreement.

The case is currently before the Supreme Court based on a circuit split; the First Circuit concluding that a debtor-licensor’s rejection of a trademark license terminates a licensee’s right to use a trademark and, conversely, the Seventh Circuit concluding that under such circumstances, a trademark licensee’s rights were not extinguished.  If the position that was advanced in the amicus brief is successful, consistent with the Seventh Circuit, a licensee can continue to use a trademark even after the licensor files bankruptcy.

The brief argued several points, including: (1) that a plain construction of Section 365 of the Bankruptcy Code demonstrates that the rejection of a trademark license by a debtor-licensor should be treated only as a breach of the license, not as a termination of the license; (2) if the rights that have been granted to a licensee in a license agreement rise to the level of a property interest, such interest cannot be divested by operation of bankruptcy law and the license agreement cannot be terminated; and (3) the quality control requirements of trademark licensing law do not preclude a licensee’s continued use of a trademark after rejection.

To read the amicus brief, click here.