Everex Systems, Inc. v. Cadtrak Corp. (In re CFLC, Inc.)

Everex Systems, Inc., a buyer of certain of the assets of CFLC, Inc. in a Chapter 11 bankruptcy, appeals the district court’s affirmance of a bankruptcy court order denying CFLC’s motion as debtor to assume and assign to Everex a patent license from Cadtrak Corporation to CFLC. 1 We have jurisdiction under 28 U.S.C. § 158 (d) and affirm.

FACTUAL BACKGROUND AND PROCEDURAL HISTORY

In a 1986 agreement, as modified by a 1989 supplemental agreement, Cadtrak, in return for a one-time $290,000 payment, granted CFLC, a personal computer company, a royalty-free, worldwide, nonexclusive license to use certain computer graphics technology for which Cadtrak holds a patent (the “Cadtrak license”). The license agreement specified, among other things, that the license was nontransferrable, that it extended to any company more than 50% of which was owned by CFLC, that it conferred on CFLC no right *675 to sublicense, that it could be terminated by Cadtrak upon CFLC’s bankruptcy, and that it was to be construed according to California law.

On January 4, 1993, CFLC began a Chapter 11 proceeding, in the course of which it sold certain divisions, foreign subsidiaries, and assets for nearly $20…