IP à la carte: A Caution For Acquisitions Involving Intellectual Property

A recent decision of the Federal Court of Canada¹ has reiterated the importance of thorough due diligence in transactions involving intellectual property ("IP") and attention to contractual terms dealing with the transfer of assets which include intangible assets.

In the Mirage case, the plaintiff operated a number of cafés in southern Ontario which formed its "Symposium Café" franchise. Each of the Symposium Cafés were of a common look and feel and offered overlapping restaurant services. In addition to registering numerous trade-marks containing "Symposium Café" and other expressions, the plaintiff also registered a trade dress representing the interior of the cafés; as depicted below, such being comprised of walls and columns of antiqued stone, a reproduction of the School of Athens fresco, a circular mahogany bar and a circular floor tile pattern extending around the circular bar: