Mission Product Holdings Inc. v. Tempnology, LLC
U.S. Supreme Court · decided May 20, 2019 · Supreme Court Database (Spaeth)
- Decided
- May 20, 2019
- Term
- October Term 2018
- Vote
- 8–1
- Majority author
- Justice Kagan
- Issue area
- Economic Activity
- Disposition
- Reversed and remanded
- Outcome
- Petitioning party won
- Ideological direction
- Liberal
Opinion excerpt
Justice KAGAN delivered the opinion of the Court. Section 365 of the Bankruptcy Code enables a debtor to "reject any executory contract"-meaning a contract that neither party has finished performing. 11 U.S.C. § 365(a). The section further provides that a debtor's rejection of a contract under that authority "constitutes a breach of such contract." § 365(g). Today we consider the meaning of those provisions in the context of a trademark licensing agreement. The question is whether the debtor-licensor's rejection of that contract deprives the licensee of its rights to use the trademark. We hold it does not. A rejection breaches a contract but does not rescind it. And that means all the rights that would ordinarily survive a contract breach, including those conveyed here, remain in place. I This case arises from a licensing agreement gone wrong. Respondent Tempnology, LLC, manufactured clothing and accessories designed to stay cool when used in exercise. It marketed those products under the brand name "Coolcore," using trademarks (e.g., logos and labels) to distinguish the gear from other athletic apparel. In 2012, Tempnology entered into a contract with petitioner Mission Product Holdings, Inc. See App. 203-255. The agreement gave Mission an exclusive license to distribute certain Coolcore products in the United States. And more important here, it granted Mission a…
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