Haynes and Boone, LLP Partner Ken Parker talked with The National Law Journal, World Intellectual Property Review and Women’s Wear Daily about the U.S. Supreme Court’s ruling that trademark licensees can generally keep their rights to use the marks even if the company that owns those trademarks goes bankrupt.
Here are excerpts:
The National Law Journal:
In Mission Product Holdings Inc. v. Tempnology LLC, the high court’s majority found that if a company that licensed its trademarks goes bankrupt and decides to reject the licensing agreement, it doesn’t necessarily strip the licensee of their right to keep using the mark under the contract.
The ruling gives trademark licensees more certainty when pursuing such agreements, which are increasingly common in fashion and retail, where brands use licensing to diversify their offerings of apparel and accessories, said attorneys.
Kenneth Parker, an IP partner at Haynes and Boone who’s not involved in the case, called that “the touchstone of the opinion”—that a debtor-licensor can’t gain things of value by breaching agreements. That’s a win not only for licensees, but also licensors in the long term, he said.
“It creates more certainty. More certainty makes licenses more valuable.”
To read the full article, click here.
World Intellectual Property Review:
Kenneth Parker, partner at Haynes and Boone, said the decision is "a win for trademark owners because it increases the overall certainty that many license agreements will remain enforceable."
"That increased certainty, in turn, will allow trademark owners to get greater value for outbound trademark licenses," Parker added.
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Women’s Wear Daily:
One potential concern in these cases may be that someone may need to keep the trademark registration active. A trademark owner who has gone bankrupt may find themselves lacking the incentive or financial resources to keep up the registration, which may require them to monitor the quality of the products produced under the trademark. But that doesn’t necessarily mean licensees are at the mercy of trademark holders’ upkeep of the registration, as long as the licensees continue using the marks, trademark attorneys said.
“Trademark rights exist independently of trademark registration,” said Ken Parker, a partner in Haynes and Boone, LLP’s intellectual property litigation practice group.
“Trademark registrations provide some additional rights in court, but generally speaking, as long as the licensees use the mark in commerce, they can use the trademark and exclude others from using it, even if the registration has lapsed,” rel="noopener noreferrer" he said.
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