EasyJet goes to court to defend use of brand

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UK budget carrier EasyJet heads to court today to defend itself against shareholder EasyGroup's claims that it is breaching the terms of its branding licence.

The airline operates under a branding agreement which states that 75% of its revenue must be derived from core activity - namely the air transport of passengers.

Since August 2008, EasyJet has been engaged in a legal intellectual property dispute with EasyGroup, over the interpretation of this '75:25' rule, which was drawn up to ensure that EasyJet stayed focused on its airline business.

EasyGroup believes that EasyJet could be breaking the rule, and the court case in London aims to clarify the interpretation of 'core business' as it applies to EasyJet's operations.

"Extensive legal advice fully supports [our] interpretation which shows that [we are] operating well within the ambit of the rule on any reasonable interpretation of it," the airline insists.

The dispute is evidence of continuing friction between EasyJet's management and the airline's founder, Stelios Haji-Ioannou, the entrepreneur behind EasyGroup.

Haji-Ioannou resigned from the EasyJet board a month ago following a smouldering row over the airline's expansion plans.

EasyJet states that the branding trial, in the High Court, is likely to last up to 10 working days.