Virgin Group is suing Alaska Airlines for a total of 160 million dollars, as reported by Reuters. The petition was filed at London’s High Court. The dispute can be traced back to a 2014 trademark license agreement.
Lawyers for the multinational conglomerate founded by Richard Branson argue that Alaska Airlines must make a payment of approximately eight million dollars each year until 2039 in «minimum royalties».
In 2014, Virgin Group and Virgin America (a US-based subsidiary that had launched services in 2007) entered into a trademark licensing agreement. Two years later, Alaska Air Group acquired Virgin America for 2.6 billion dollars. The ultimate goal was to merge the two companies’ operations in early 2018, which was achieved in April.
«The minimum royalty is due as a debt, as consideration for the grant of the right to use the Virgin brand, irrespective of whether, and if so how much, the Virgin brand is actually used by Alaska Airlines» said Daniel Toledano, lawyer for Virgin Group.
«Virgin’s interpretation is an obviously surprising one» replied Tom Weisselberg, lawyer for Alaska Airlines. The American carrier argues that it stopped using the mark in 2019, a year after the unification of the two operators’ certificates. «If Alaska Airlines were truly subject to a nine-figure obligation for decades, one would expect it to be clearly specified», he added.
For its part, Virgin Group argues that Alaska Airlines, as the legal successor to Virgin America, is obliged to make the payment even though it has stopped using the brand. The legal process began last Monday and is expected to last about a week.
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