Exclusion of Consequential and Other Types of Damages. 1:10 Termination § 1:11 Licensee Transferability Rights § 1:12 Bankruptcy-Related Issues § 1:12.1 Applicable Bankruptcy Principles [A] Unenforceability of Ipso Facto Clauses [B] Assignment and Assumption of Executory Contracts [C] Unenforceability of Anti-Assignment Language [D] Avoidance of Transfers § 1:12.2 Bankruptcy of the Customer [A] Protections for Vendors [B] Potential Consequences for the Customer § 1:12.3 Bankruptcy of the Vendor [A] Protections for Customers [B] Limitations of Bankruptcy Code Section 365(n) § 1:12.4 Technology Escrow Agreements § 1:13 Secured Creditors § 1:13.1 Security Interests in Licensed IP § 1:13.2 Nonexclusive Licensees in the Ordinary Course § 1:13.3 Mitigating Secured Creditor Risks
Exclusion of Consequential and Other Types of Damages. It is a common practice for vendors to include provisions that distinguish between “direct” or “general” damages on the one hand (usually allowed), and “consequential” or “special” damages on the other hand (frequently excluded).21 It is the author’s belief, however, that this practice frequently flows from common misunderstandings regarding the meaning of the applicable terms. These misunderstand- ings are evident both in written agreements between contracting parties and in court opinions interpreting those agreements.22 Some seem to think that consequential damages are those damages that are so vague, speculative, or loosely related to the contract that no fair-minded person should think they are appropriate. This is a misperception of contract law. Just like direct damages, consequential
Exclusion of Consequential and Other Types of Damages. It is a common practice for vendors to include provisions that distinguish between “direct” or “general” damages on the one hand (usually allowed), and “consequential” or “special” damages on the other hand (frequently excluded).23 It is the author’s belief, however, that this practice frequently flows from common misunderstandings
