M&A’ Red Flags for the United States #3

The U.S.court decision Cincom Systems, Inc. v. Novelis Corp. serves as a good reminder that an important step in structuring a transaction is analyzing whether the transaction will trigger the need to obtain the consent of third parties that have contracts with the target company. Where patent or copyright licenses constitute material assets of the target company, that analysis should take into consideration not only the language of the license agreements, but also the federal law presumption against assignability of patent or copyright licenses.