Court Filing Reveals Complex Trademark Issues as 14 Major Chains Pursue Goods Access
Lion Ribbon Texas Corp. and its affiliated debtors have filed an emergency motion seeking court approval for procedures that would allow 14 major U.S. retailers to access holiday merchandise containing valuable intellectual property from key brands. The August 15, 2025 filing in the U.S. Bankruptcy Court for the Southern District of Texas highlights the complex web of trademark relationships that can emerge when a global supplier files for bankruptcy protection.
The emergency motion, with a hearing scheduled for August 19, 2025, represents the latest effort by the craft and stationery products company to preserve critical retailer relationships while navigating Chapter 11 proceedings that began July 3, 2025. The case involves what the company terms "Dual IP Products"—merchandise that contains both the debtor's own intellectual property and that of major entertainment and sports licensors.
Background on the Bankruptcy Case
IG Design Group Americas, Inc. and its subsidiaries, including Lion Ribbon Texas Corp., comprise a global company that designs, manufactures, and distributes consumer crafting, gifting, and stationery products. The company operates facilities across North America with supporting operations in India, Hong Kong, China, the United Kingdom, and Australia. The debtors filed for Chapter 11 protection citing "tariff-induced liquidity pressure and other challenges," securing a $53 million debtor-in-possession financing facility from HCS 107, LLC, an affiliate of their ultimate parent company.
Prior to filing bankruptcy, the company was forced to cancel numerous purchase orders with overseas manufacturers, leaving major retail customers unable to access goods crucial for upcoming holiday selling seasons. The current motion builds on a previous court order that addressed simpler private-label products, but the new request deals with merchandise involving multiple intellectual property holders.
Complex Intellectual Property Arrangements
The emergency motion reveals the intricate licensing relationships that govern modern retail merchandise. The "Dual IP Products" at issue contain trademarks, designs, and other intellectual property owned by both the debtors and major third-party licensors. This creates what the company describes as "an additional layer of complexity" that could lead to a "no good deed goes unpunished maze" of negotiations with multiple parties.
The 14 key retailers seeking access to these products represent a who's-who of American retail. Many of these retailers continue to maintain separate business relationships with other segments of the debtor's operations that are being marketed for sale as going concerns.
Proposed Trademark Authorization Procedures
To address the administrative complexity while protecting all parties' interests, the debtors have crafted "Trademark Authorization Procedures" that shift the majority of the burden to the retailers themselves. Under the proposed framework, any retailer seeking access to the goods must compile a comprehensive "Trademark Authorization Proposal" that includes:
A fully executed Trademark Authorization Agreement that follows the court-approved form without material deviations; a detailed schedule identifying each product and its associated trademark licensors; and crucially, executed "Licensor Release Agreements" from each applicable trademark licensor that names the debtors as third-party beneficiaries.
The procedures require retailers to deliver complete packages to the debtors, who will then either accept the proposal with a countersigned agreement or provide a brief explanation for rejection. The debtors will maintain a weekly status matrix shared with counsel for the DIP lender and the creditors' committee.
Business Justification and Stakeholder Support
The debtors argue that maintaining positive relationships with these key retailers is "of critical importance," particularly because many continue doing business with segments of the company being sold as going concerns. The motion states that "losing the continued goodwill of such important customers could have broader implications for the Debtors."
The proposed agreements include significant protections for the debtors, including strict time limits on intellectual property usage tied to specific selling seasons and comprehensive releases from claims related to the cancelled purchase orders.
Emergency Timing and Holiday Pressures
The debtors are requesting emergency consideration, emphasizing that "relevant holiday seasons are swiftly approaching" and that retailers have expressed concern about filling their shelves. The motion argues that further delay would "hamper the Debtors' relationships with such valuable partners to the detriment of the estates."
The company seeks to waive standard notice requirements and the fourteen-day stay typically imposed under Bankruptcy Rule 6004(h), arguing that immediate relief is necessary to maximize recovery for stakeholders.
Broader Implications for Retail Supply Chains
The case illustrates the potential cascade effects when a significant supplier files for bankruptcy protection during critical retail periods. The company's global operations and relationships with major entertainment and sports licensors demonstrate how modern supply chains involve complex webs of intellectual property relationships that can complicate bankruptcy proceedings.
The motion notes that the proposed procedures aim to preserve value not only with retail customers but also with trademark licensors, which could be important factors in any going-concern sale of the business segments currently being marketed.
The emergency hearing is scheduled for August 19, 2025, at 11:00 a.m. Central Time before Judge Lopez in the Houston Division of the U.S. Bankruptcy Court for the Southern District of Texas.
This article was prepared using Stretto Conductor, our new AI-powered assistant that's here to help. Stretto Conductor was able to create this summary of a 20 page court filing in less than a minute. Always review the underlying docket filings for accurate information. The information and responses generated by Stretto Conductor may contain errors or inaccuracies and should not be relied upon as a substitute for professional or legal advice.