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Bankruptcy Keyed to Howard 7th Ed.
Sunbeam Products, Inc. v. Chicago American Manufacturing, LLC
Citation:
686 F.3d 372 (2012)Facts
Lakewood Engineering & Manufacturing Co. manufactured consumer products covered by patents and trademarks. In 2008, facing financial difficulties, Lakewood contracted with Chicago American Manufacturing (CAM) to produce box fans. The contract authorized CAM to practice Lakewood’s patents and use its trademarks, with CAM shipping directly to retailers on Lakewood’s instructions. To secure CAM’s investment in production of approximately 1.2 million fans for the 2009 season, Lakewood authorized CAM to sell the fans for its own account if Lakewood failed to purchase them. In February 2009, creditors filed an involuntary bankruptcy petition against Lakewood. The bankruptcy trustee sold Lakewood’s assets, including patents and trademarks, to Sunbeam Products (Jarden). Jarden did not want CAM’s inventory or competition from Lakewood-branded fans. The trustee rejected the executory portion of the Lakewood-CAM contract under § 365(a), but CAM continued manufacturing and selling Lakewood-branded fans, prompting this adversary proceeding.
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