The Wadia Group, one of the oldest business conglomerates in India is caught in an internal trademark tussle between two of its companies over the ownership of various trademarks including the mark ‘Go Air’, which were being used in connection with its aircraft carrier business.
The company ‘Go Airlines’, has been using the marks ‘Go Air’, ‘Fly Smart’, ‘Experience the difference Go Air’ and various other marks for its aircraft carrier business since 2004, however the said marks have been registered in the name of another company, i.e., ‘Go Holdings’. Both of these companies are controlled by the Wadia Group, with Jehangir Nusli Wadia holding 99.0% of the shares in Go Holdings. He is also a promoter of Go Airlines and has recently stepped down from the position of the Managing Director of the same.
The group recently declared its decision of taking ‘Go Airlines’ public, the first of its companies to go public in over three decades, along with announcing the re-branding of the carrier from ‘Go Air’ to ‘Go first’. This re-branding comes amidst the heavy losses suffered by the airline due to the ongoing pandemic, and its determination to get back, by its new ‘ultra low cost airline model’, aimed at attracting young travellers, who demand speed, convenience and value. The airline plans to offer attractive low cost airfares, clean and sanitised flights and on time performance. The Company is currently in the process of transitioning from Go Air to Go first, however it plans to continue to use the brand Go Air until the transition process is completed.
Trademark tussle over ‘Go Air’
In the Draft Red Herring Prospectus (DRHP) filed by Go Airlines with the SEBI[1], it has revealed that the brand ‘Go Air’ is owned by ‘Go Holdings’; which also owns a number of other Trademarks being used in the aircraft carrier business. Go Airlines claims the use of these marks since 2004, and for a brief period of four years, i.e., from 2006-2009 and 2013-2014, there were written license agreements between the two companies governing the use of these marks. For the remaining years the use of these trademarks was not governed by written agreements, and there is no agreement in place at the moment as well. The Trademark tussle between the two companies kicked off with Jehangir Wadia’s decision to step down as the Managing Director of Go Airlines and subsequently, Go Holdings making an application to the Trademark registry for the registration of the marks “Go Airlines” and “www.goair.in” , which were exclusively being used by Go Airlines. Moreover, in April 2021, Jehangir Wadia applied to the National Internet Exchange of India to transfer 115 domain names registered in the name of Go Airlines from one domain registrar to another domain registrar.
Go Airlines has opposed the said applications before the Trademark registry and has also applied for the registration of the two above mentioned marks in its own name. Moreover as revealed by their DRHP, the company intends to pursue legal options to establish their ownership over all the trademarks and domain names.
Issue of ownership of the marks
A perusal of the Public documents available on the Trademark registry’s portal indicate that the marks ‘Go Air’, ‘Experience the difference Go Air’, ‘The great Go air challenge’ etc; initially got registration in the name of ‘Go Airlines’ itself, and all documents uploaded by the registry including the Trademark Registration certificate indicate Go Airlines as the proprietor of these marks. However, subsequent to 2012, Go holdings has been indicated as their proprietor, implying that the mark was assigned by Go Airlines to Go holdings, while reserving for itself the right to use the same for its aircraft carrier business. Written license agreements have governed their use only for a period of four years, and for the rest of the period of use, there has been an implied agreement and an acquiescence by Go holdings over the use of these marks by Go Airlines, since there have been no instances of any objection to the same. Go Holdings has been actively defending the marks owned by it as it had sued the aircraft carrier Indigo before the Bombay High Court[2], over the use of its mark ‘Go Indigo’ citing Trademark infringement on grounds of deceptive similarity.
Under the Trademarks Act, although an assignment of a mark compulsorily needs to be in writing and registered with the Registrar of Trademarks, there is no such obligation for Trademark licenses. In fact, the act does not even use the term license, and rather mentions the term ‘registered user’, who is a person authorised by the proprietor of a mark to use his registered mark in exchange for a royalty. Licensees of Trademarks fall under this category and the act does not obligate licenses to be registered. Following from the general principles of Contract law, an agreement may also be oral or implied, and since the Trademark Act does not lay down any specific obligation to enter into a written license agreement, it is the opinion of the author that an implied agreement to use a mark is certainly valid and cannot be challenged by the proprietor of the mark. The author did not come across any such decision by any Indian court, however in other Jurisdictions like USA[3] and Canada[4], the courts have recognised an implied trademark license agreement to be valid, however, any license arrangement or any kind of contribution in the business of the proprietor does not confer ownership of the marks on the licensee, unless expressly conferred.
Thus Go Airlines may be able to continue its use of the marks held by Go holdings, but to establish ownership over the same, it will have to resort to other provisions under the Act. For instance, Go Airlines can apply to get the marks registered in the name of ‘Go Holdings’ cancelled and the register rectified on any of the grounds mentioned under section 57, which provides for cancellation on grounds like Trademark wrongfully remaining on the register, entry made without sufficient cause, contravention of a condition entered on the register etc. It can also get these marks registered in its own name by virtue of section 12 of the Act, which allows for the registration of two similar or identical marks by more than one proprietor, on grounds of honest concurrent use.
Apart from the traditional options of litigating against Go Holdings, Go airlines may also resort to Alternative dispute resolution mechanisms like Mediation, Negotiation and Arbitration to reach a mutually acceptable settlement with Go Holdings. This is the most hassle free method, as it avoids litigation costs, saves the time of the parties and helps in concluding a mutual settlement.
Author’s Analysis of the issue
Consumers today have a wide array of goods and services in the market to chose from, and in this competitive marketplace, it has become extremely important to create a good brand image. The word brand is sometimes used interchangeably with trademarks, however, brand is a much wider concept and encompasses various tangible and intangible things like trademark, design, logo, trade dress, concept, image, reputation of a company. Brand reflects the aspirations, commitments, and the overall concept that the company is trying to deliver. Trademark is one of the most essential elements of a brand, as its registration provides legal protection to the brand, and prevents unauthorised use of the brand name. Thus in creating a brand, the importance of trademarks should not be undermined, and companies must take steps to ensure that they conduct proper Trademark due diligence and Trademark Portfolio management. It is of utmost importance to ensure that the Trademarks used by a company are registered in its own name, or there are written license agreements governing the use of such marks by the company. Every company must take reasonable steps to identify its trademarks, and take all possible measures to secure the ownership of the same in its own name, to avoid any conflicts in the future. Go Airlines would not have faced the challenges by Go Holdings as it is facing now, had the former retained the registrations of the various marks in its own name.
[1] Available at – https://www.sebi.gov.in/filings/public-issues/may-2021/go-airlines-india-limited-drhp_50122.html.
[2] Go Holdings Pvt Ltd. V Interglobe Aviation Ltd. , (Suit no. 28 of 2014)
[3] Allianz Asset Management of America L.P. v. Middlefield Capital Corporation
[4] Corey Bessner Consulting Inc. v. Core Consultants Realty Inc., 2020 FC 224.
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