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March 20, 2007

Today the Supreme Court issued a decision, described below, of interest to the business community.

Travelers Casualty & Surety Co. v. Pacific Gas & Electric Co., No. 05-1429 (previously discussed in the October 9, 2006 Docket Report). In a unanimous decision authored by Justice Alito, the Court held that federal bankruptcy law does not preclude an unsecured creditor from recovering attorneys' fees that were guaranteed by a prepetition contract simply because those fees were incurred in postpetition litigation of bankruptcy law issues. In rejecting a contrary rule that had been adopted by several circuits, the Court emphasized that a creditor's claim-the validity of which is generally determined by state law-is allowable unless the Bankruptcy Code provides otherwise.

If you have any questions about this decision, please contact Andrew Tauber at atauber@mayerbrown.com or 202-263-3324.

An article by Jim Ferguson, a Mayer Brown partner who specializes in intellectual property litigation, that discusses how to draft patent licenses and settlement agreements in light of the Supreme Court's recent decision in MedImmune v. Genentech, 127 S. Ct. 764 (2007). The article appeared in last week's IP Law 360. Jim can be reached at (312) 701-7282 or jferguson@mayerbrown.com.

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Mayer Brown Supreme Court Docket Reports provide information and comments on legal issues and developments of interest to our clients and friends. They are not a comprehensive treatment of the subject matter covered and are not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed.

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