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(Ch. 126)

Intellectual Property in bankruptcy

Eric E. Bensen

Intellectual property in bankruptcy, a Collier Monograph (now Collier Bankruptcy Practice Guide chapter 126), examines how IP rights are affected when they have been assigned, transferred, sold or licensed and one of the parties to the transaction files for bankruptcy. The analysis provides an understanding of the interplay between bankruptcy and intellectual property law and discusses the complex questions that arise in bankruptcy when security and licensed interests in intellectual property and infringement and misappropriation suits and awards relating to intellectual property rights are involved.

The monograph was written by Eric E. Bensen and is reprinted from Chapter 10 of Collier Guide to Chapter 11: Key Topics and Selected Industries.

Specifically, Intellectual Property in Bankruptcy examines the following:

  • The definitional aspects of the four major forms of intellectual property--patents, trade secrets, copyrights and trademarks--with a focus on each as a form of transferable property; 

  • Security interests in intellectual property and the interplay between state law methods for perfecting such interests and federal recordation statutes; 

  • Intellectual property licensing principles and practices, specifically rejection, assumption and assignment of intellectual property licenses with a focus on the nondebtor licensee's right to maintain a license after rejection and the competing doctrines that have emerged concerning the debtor in possession's right to assume an intellectual property license in view of federal common law prohibiting (in most cases) assignment of such licenses; 

  • Intellectual property infringement suits and awards, including the jurisdiction of the bankruptcy court to hear such disputes, the impact of the automatic stay and the dischargeability of such awards.

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