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Earlier today, the Ninth Circuit Court of Appeals issued its long-awaited ruling in the Garvin v. Cook Investments, NW, SPNYW case This opinion is certain to be of great interest to both companies operating in the cannabis space and those attorneys representing them. In Garvin, the US Trustee appealed confirmation of a plan of reorganization under which one of the debtors leased property to a marijuana grower licensed under Washington law. The US Trustee argued…
What are the limits of a bankruptcy court’s authority to issue final orders and judgments?  Does a bankruptcy court have authority under Article III of the U.S. Constitution to enter final orders in quintessential bankruptcy matters such as fraudulent transfer claims, or are the court’s powers more constrained?  While the Supreme Court’s rulings in Stern v. Marshall, 546 U.S. 462 (2011), Executive Benefits Ins. Agency v. Arkison, 573 U.S. 25 (2014) and Wellness International Network,…
In prior posts, we examined whether state-licensed marijuana businesses, and those doing business with marijuana businesses, can seek relief under the Bankruptcy Code.  As we noted, the Office of the United States Trustee (the “UST”) has taken the position that a marijuana business cannot seek bankruptcy relief because the business itself violates the Controlled Substances Act 21, U.S.C. §§ 801, et seq. (the “CSA”), notwithstanding their state licenses. The UST has also taken the position…
The recent decision by the Fifth Circuit Court of Appeals in In re Provider Meds, L.L.C. is a stark reminder to chapter 7 trustees that they have an affirmative obligation to examine a debtor’s assets.  A trustee’s failure to conduct a sufficient and timely examination may deprive the estate of significant value. The issue before the Court in Provider Meds was whether the assumption and assignment of an intellectual property license agreement (the “License Agreement”)…
The Supreme Court Is Now Poised to Answer This Question.   Certain licensees of intellectual property are expressly given expanded rights when their licensors file bankruptcy.  But, what about trademark licensees?  Trademarks are not among the defined categories of “intellectual property” for bankruptcy purposes.  Nonetheless, are trademark licensees otherwise protected in a licensor bankruptcy?  The U.S. Supreme Court is poised to finally answer this question now that it has granted certiorari in Mission Product Holdings,…
In prior posts, we discussed the perplexing issue of how and whether a trademark licensee is protected when the trademark owner/licensor files a bankruptcy petition and moves to reject the trademark license in accordance with section 365 of the Bankruptcy Code. In January of this year, the First Circuit Court of Appeals issued its ruling in Mission Product Holdings, Inc. v. Tempnology, LLC, 879 F.3d 389 (2018), holding that a trademark licensee was not…
We have discussed plan releases in prior posts.  Oftentimes, disputes involving plan releases revolve around whether, and in what contexts, third-party releases in plans are appropriate.  Recently, the Third Circuit Court of Appeals addressed the relatively unique question of whether releases in a confirmed plan are binding upon post-confirmation purchasers of the debtor’s stock. The Court’s decision in Arctic Glacier Int’l, Inc. puts buyers of a debtor’s claims and shares on notice that they…
The Bankruptcy Code grants special rights to licensees of intellectual property. It is imperative for in-house counsel to have at least a basic understanding of how intellectual property is treated under the Bankruptcy Code, and the rights and obligations of parties to intellectual property licenses. My colleague Grace King and I recently wrote a chapter entitled “Intellectual Property Acquired Through Bankruptcy” that appears as part of the American Bar Association’s publication Intellectual Property and Technology. While the…
More and more states are legalizing marijuana, whether for medical or recreational purposes. As businesses try to enter this space, competition will “weed out” the weakest competitors.  But are marijuana dispensaries and growers, and those providing ancillary services to them, able to seek relief under the Bankruptcy Code? We, along with our colleagues, John Wyand and Sarah Stec, this week published an article with Practical Law addressing this topic. We hope that you enjoy the article and…