Virgin Aviation TM Limited & Anor v Alaska Airlines Inc

Virgin Aviation TM Limited & Anor v Alaska Airlines Inc

The Licence, properly construed, requires Alaska to pay the Minimum Royalty each financial year regardless of actual use of the Virgin Brand. Clause 3.7 does not override the obligation to pay the Minimum Royalty; it only allows Alaska to operate without using the Brand and without paying usage-based royalties, but not to avoid the Minimum Royalty, which is a flat fee for the rights granted.

Parties
Claimant/respondent: Virgin Aviation TM Limited; Claimant/respondent: Virgin Enterprises Limited; Defendant/appellant: Alaska Airlines Inc (formerly Virgin America Inc)
Jurisdiction
England and Wales
Judgment Date
06 November 2024
Procedural Posture
Civil Appeal / Court of Appeal Judgment
Outcome
Appeal dismissed
Legal Topics
Contractual Interpretation, Trademark Licensing, Minimum Royalty Payments
Contract Law Commercial Law Intellectual Property Contractual Interpretation Trademark Licensing Minimum Royalty Payments

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Parties

Virgin Aviation TM Limited

Claimant/respondent

Virgin Enterprises Limited

Claimant/respondent

Alaska Airlines Inc (formerly Virgin America Inc)

Defendant/appellant

Procedural Posture

Civil Appeal / Court of Appeal Judgment

Legal Issues

  1. 1 Whether clause 3.7 of the trademark licence agreement allows Alaska to avoid payment of the Minimum Royalty when not using the Virgin Brand
  2. 2 Proper construction of the Minimum Royalty obligation under the Licence

Ratio Decidendi

The Licence, properly construed, requires Alaska to pay the Minimum Royalty each financial year regardless of actual use of the Virgin Brand. Clause 3.7 does not override the obligation to pay the Minimum Royalty; it only allows Alaska to operate without using the Brand and without paying usage-based royalties, but not to avoid the Minimum Royalty, which is a flat fee for the rights granted.

Court Disposition

Appeal dismissed

Orders

  • Alaska must pay Virgin at least the Minimum Royalty for each financial year of the Licence, even if no Gross Sales are derived from use of the trademarks.