In re CATAPULT ENTERTAINMENT, INC., a California corporation, aka Storm Systems, Debtor. STEPHEN PERLMAN, Appellant, v. CATAPULT ENTERTAINMENT, INC., a California corporation, aka Storm Systems, Appellee., 165 F.3d 747

Summary

Appellee licensee created an online gaming network for console videogames and entered into two license agreements with appellant licensor that granted appellee the right to exploit certain relevant technologies, including patents and patent applications. Appellee filed for Chapter 11 bankruptcy protection. Appellant sought to bar appellee from assuming the patent licenses as part of its reorganization plan through a reverse triangular merger with another company. The bankruptcy court approved the assumption of the licenses and confirmed the reorganization plan. The trial court affirmed the bankruptcy court's decision on intermediate appeal. The appellate court reversed the decision because 11 U.S.C.S. § 365(c)(1) barred assumption of an executory contract without consent where applicable law precluded contract assignment to a third party for the reason that the identity of the nondebtor party was material. Therefore, as a debtor in possession, appellee could not assume the nonexclusive...