Sonder: the last asset was the name

Sonder Canada Inc. and Hospitalité Sonder Canada Inc. filed assignments in bankruptcy on November 12, 2025, and Ernst & Young Inc. was appointed trustee of both estates by the Official Receiver, per Application for the Issuance of an Approval and Vesting Order, June 30, 2026, para. 5.

Eight months later the estates hold no hotels, no apartments, no furniture and no leases. What they hold is a brand.

What was sold first

The physical estate went early and quickly.

On December 12, 2025 the court made an order — the Authorization Order — that did two things: it authorised the party represented by the inspectors to acquire certain assets of HSCI, and it confirmed the trustee's authority to take any action contemplated by s. 30 of the BIA without the approval of the inspectors if the inspectors were considered to be in a conflict of interest, per Application, June 30, 2026, para. 9.

That clause was drafted for a problem that had already appeared and would appear again.

On December 23, 2025 the court issued an approval and vesting order authorising the assignment of HSCI's rights in certain leases and the sale of all the furniture, fixtures and equipment in or associated with those premises, free and clear of encumbrances. Through January 2026 the trustee completed further transactions on other leases and FF&E, per Application, June 30, 2026, paras. 10–11.

After which, in the application's own words, the only material remaining assets in the estates were the debtors' rights, titles and interests in certain intellectual property related to the Sonder group.

A hospitality business that operated out of leased buildings, furnished them, and put a name on the door ends up — once the buildings and the furniture are gone — owning the name.

The inspectors could not be asked

Interest in the Sonder IP had been arriving since December 2025 and was repeated in early 2026. Before launching any process, the trustee reached a conclusion about its own oversight, per Application, June 30, 2026, paras. 12–13.

The inspectors of HSCI's estate would be ineligible to consider or provide instructions on the exercise of the trustee's powers in the IP solicitation process, because they represent a party the trustee intended to solicit as part of that very process, per Application, June 30, 2026, para. 17.

So the trustee did the only clean thing available: it went to the inspectors and asked them to authorise it to proceed without them. At a meeting on April 23, 2026, the inspectors authorised the trustee to deploy and conduct the process under its powers in the Authorization Order and without inspector authorisation; a resolution to that effect was executed on April 29 after clarifications, per Application, June 30, 2026, para. 18.

For SCI the problem did not arise, for a different reason: its creditors declined to appoint any inspectors at all, so the trustee proceeded there under its authority in s. 30(3) of the BIA, per Application, June 30, 2026, paras. 8(c), 19.

Two estates, two routes around the same requirement — one by conflict, one by absence.

The process, and its dates

The trustee launched on April 27, 2026 by contacting various parties including those that had already expressed interest, sending a process letter with the guidelines, inviting execution of a confidentiality and non-disclosure agreement, and requiring binding offers by May 22, 2026 at 5:00 p.m. Eastern, as extended, per Application, June 30, 2026, para. 20.

After the bid deadline the trustee sought clarifications, and on the basis of the offers received determined that the transaction contemplated by one of them was the most advantageous to the creditors of both estates. It accepted that offer on June 5, 2026 and notified the purchaser, per Application, June 30, 2026, paras. 22–24.

The purchaser is UpNext Ventures Inc., named in the application as impleaded party.

Negotiation of the definitive documents ran over the following weeks, and as at the date of the application the asset purchase agreement was still being finalised — the trustee expecting to execute it before the application was presented. The current draft is filed under seal, with a publicly filed version carrying minor redactions, per Application, June 30, 2026, paras. 25–27.

What transfers, including what nobody has found yet

The purchased assets are the domain names and trademarks identified in Schedule A to the purchase agreement and to the proposed order.

The agreement also transfers the debtors' rights in any other intellectual property shown of record in any applicable registry as belonging to them — the Residual Assets, listed in Schedule B — provided those assets are determined to be assets of the debtors and subject to certain conditions, per Application, June 30, 2026, para. 29(c).

That is a sensible piece of drafting for an IP estate in a group with intercompany agreements: registrations scattered across jurisdictions in names nobody has fully reconciled, swept up conditionally rather than left behind to be discovered later by a purchaser who has already paid.

The trustee also undertakes to cooperate in good faith with renewals — the mundane but essential point that a trademark portfolio needs someone to file for it during the gap between acceptance and transfer, per Application, June 30, 2026, para. 29(g).

Closing is to occur no later than seven calendar days after the order issues, and in all cases no later than July 31, 2026. The transaction is conditional only on the court vesting the assets free and clear, per Application, June 30, 2026, paras. 29(e)–(f).

A one-condition deal with a hard outside date is what a trustee wants at the end of an estate. There is nothing left to be diligenced.

The Quebec mechanics

The application is brought under ss. 30, 72.1 and 183 of the BIA, and it comes with two features worth noting for anyone practising outside Quebec.

First, alongside the vesting order the trustee seeks an Ordonnance de réduction — a reduction order — to give effect to reductions of registrations at the Register of Personal and Movable Real Rights. Vesting free and clear is not self-executing against the RPMRR; the registrations have to be reduced, and that takes its own order, per Application, June 30, 2026, para. 2.

Second, the trustee files a redline of the proposed order against the model Approval and Vesting Order developed by the Liaison Committee of the Commercial Division of the Superior Court — the Quebec equivalent of the practice on the Commercial List in Toronto, and the fastest way to show a judge exactly which departures from the model are being asked for, per Application, June 30, 2026, para. 1 n.1.

The trustee's position is that the transaction is fair and reasonable and the best available alternative in the circumstances, with the detail of the process and the offers received to be set out in its Third Report, communicated before the application was presented, per Application, June 30, 2026, paras. 4, 28.