As IndiGo, the country’s fastest growing and only profitable airline, gets ready for its Initial Public Offering (IPO) at BSE, its ongoing legal battle against Tata Motors for the Indigo brand name is getting more intense.
Tata Motors has launched the Indigo sedan back in 2002 and the airline by the same name came into existence only in 2006. Tata served legal notices to the airline’s parent company Interglobe Aviation in 2005 but the latter went ahead and registered IndiGo as a trademark.
The dispute is currently pending in courts with the automaker opposing Interglobe’s four trade names – IndiGo, IndiGo Airways, IndiGo Airlines, and IndiGo Air. In its IPO prospectus, the airline company acknowledges that a failure in registering the trademark could adversely affect its business.
IndiGo is expected to be valued at USD 4 billion dollars after the IPO which is more than five times the current market capitalization value of its nearest competitor, Jet Airways. It’s to be noted that Tata Motors’ sister companies Vistara (a Tata and Singapore airlines JV) and AirAsia India are direct rivals of Interglobe’s IndiGo.
Legal experts says that trademarks are limited to their categories. If an imitator uses the trademark in a different business category, it may not be considered as infringement and this legal loophole may help the airline disentangle itself from this mess.