In brief
The North America Tax Practice Group presented The Future of IP Planning, the fourth webinar in the series The Importance of Tax in the Response to COVID-19 on 1 May 2020.
The global economy has suffered a massive hit from the COVID-19 pandemic. The collective impact of disruptions to supply chains and falling consumer demand have caused many businesses to suffer varying degrees of financial stress with some having to recapitalise or refinance. While some M&A transactions on foot prior to the onset of the pandemic have been disrupted or delayed, the impact of the pandemic will open up opportunities for cashed-up funds and other buyers to, in time, take advantage of strategic and investment opportunities presented by the pandemic.
In a recent decision, the First Circuit Court of Appeals ruled that the rejection by a licensor of a trademark license stripped the licensee of its right to use the trademark post-rejection, reversing a decision by the intermediate bankruptcy appellate panel (BAP) and reinstating the bankruptcy court’s original judgment. In re Tempnology, LLC, 2018 WL 387621 (1st Cir. Jan. 12, 2018), reversing in part 559 B.R. 809 (B.A.P. 1st Cir. 2016). The First Circuit did, however, affirm that the rejection stripped the licensee's exclusive product distribution rights.
This is the twenty-ninth in our series of General Counsel Updates which aim to summarise major developments in key areas.
While the COVID-19 pandemic has wreaked havoc on the global economic marketplace, not all concerns are immediately visible - such as bankruptcy impacting a business’s intellectual property.
The COVID-19 crisis has pushed intellectual property holders and implementers into a distressed situation. In this webinar, we explore what happens if a party to an IP licence becomes insolvent, and discuss practical tips for the non-insolvent party to protect its position.
The Main Street Lending Program is designed to help companies that were in sound financial condition prior to the COVID-19 pandemic to maintain their operations and payroll until conditions normalize. This White Paper gives a broad understanding of the program’s terms and implications by delving into the key questions that market participants are likely to have about the program and addressing the latest changes implemented in the final legal forms and agreements.
Consequences and contractual options
Licensors of intellectual property rights may soon be unable to terminate licences where the licensee has gone into an insolvency process.
What are ipso facto clauses and why do they matter?
As the impact of COVID-19 is felt throughout the economy, even those companies able to weather the storm are likely to feel the effects of corporate insolvency as collaborators, customers and suppliers find themselves in financial difficulty. This article focuses on the impact of insolvency on IP licences from the perspective of both licensors and licensees. It also contains our top tips for mitigating the risks.