mARCH 2012 www.lawyer-monthly.com Legal Focus

M & As often require that changes in ownership of IPRs be recorded at the relevant IPR office, in favour of the resulting entity and care must be taken to ensure this is scrupulously carried out.

The nature of due diligence required for an M&A is often tailored to the transactional objectives of the parties involved in a potential M&A. Thus, it may be difficult, if not impossible to draw up an exhaustive list of the due diligence involved in an M&A.

Q Detailed hereunder are some of the

core areas to be considered in an IP due diligence:

• Delineation of the IP rights of parties: An appraisal of all files dealing with the IP rights of the parties is necessary. All documents must be scrutinized carefully, to determine what rights they pertain to: patents, trade secrets, trademarks, designs, copyrights,

licensing rights,

confidentiality agreements (NDAs for example), domain names etc. The Strength of the IPRS should be assessed. Trademarks registered more than five years ago should be in use or may be faced with possible non-use actions and eventual removal from the Registry’s records. Verification/Confirmatory searches at the Trademarks, Patents and Designs Registries are necessary to determine the actual status of the IPRs and to ensure they are updated appropriately. Depending on the nature of the IPRs, similar searches may be required at the Copyright Commission as well as the National Office for Technology Acquisition and Promotion (NOTAP). Care must be taken to ensure that inventions in particular and IPRs generally, are owned by the relevant corporate entities and not by employers, with

Although, there are IP contentious issues that arise during M&A, very few end up in court. Such issues are usually settled out of court and the terms of settlement made a judgment of the Federal High Court for sake of enforcement.

Q Q

Have there been any significant

changes recently?

There have been no significant legislative changes in terms of M & As, in spite of the rise of such transactions in the country. The Security and Exchange Commission (SEC) however

legislative

Are there many cases of IP- related litigation that arise with the M&A market?

Uwa Ohiku: Partner, Head

Intellectual Property Department

JACKSON, ETTI & EDU 3-5 Sinari Daranijo Street, Off Ajose Adeogun, Victoria Island, Lagos. Nigeria

Mob: +234 8034529339 Email: uwaohiku@jacksonettiandedu.com Website: www.jacksonettiandedu.com

what due diligence should companies carry out?

the required assignment of invention agreements promptly executed in favour of the corporate entities.

• Identification of the existence of any defects in title i.e. pending oppositions, cancellation actions or litigations- All ‘defects’ in the title of IPRs involved in M & As must be ascertained. An Infringement case against one of the parties for example, would be of concern.

• Verification of proprietorship of valid licenses and IP rights: It is also important to ensure that the extent of the rights owned are in tandem with the entire purpose of the M&A and appropriate licenses for the use of the IP assets and various technologies have been duly obtained. A practical way to do this would be to review all agreements between the parties and third parties.

• Need for 3rd party license should be disclosed: There is a need to confirm whether or not the intellectual property and technology available is necessary for the resulting entity to conduct its business.

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recently promulgated new rules for M&A contained in Rules 420-439 of the Amended Sec Rules and Regulations 2011. The SEC rules are a subsidiary legislation made pursuant to the Investment Security Act, 2007.

Our review of rules 420-439, indicated

that there were no IP specific provisions contained therein. LM

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