Alaska Airlines contended that because it no longer uses the trademarks, it should be allowed control over them without ongoing payment. The court rejected this argument, noting that holding exclusive rights prevents competitors from using the Virgin name in the US market—a benefit beyond mere usage—and that exclusivity was only one aspect of what Alaska received under the agreement. The court found that Alaska could not unilaterally end its obligations under the original licensing deal.

The background traces back to when Richard Branson's Virgin Group launched Virgin America in 2004. Over a decade later, after expanding operations across North America and going public on NASDAQ in 2014, Virgin America attracted acquisition interest from major airlines. In early 2016, both JetBlue and Alaska Airlines made offers for Virgin America during a bidding war; ultimately, Alaska secured ownership for $2.6 billion at $44.75 per share. The acquisition allowed Alaska access to valuable airport slots and expanded its route network within a consolidating US airline industry.

In recent years, consolidation has shaped US aviation significantly—with notable deals such as Spirit’s blocked merger with JetBlue over competition concerns and Hawaiian Airlines’ ongoing acquisition by Alaska Airlines slated for completion in 2026.

Delta Air Lines has also become involved due to its transatlantic partnership with Virgin Atlantic; Delta owns a 49% stake in that carrier. Alaska alleges Delta is indirectly promoting domestic US flights under the Virgin brand via loyalty programs like Flying Club—allegedly infringing on exclusive rights granted by their own agreement with Virgin Group.

Delta responded by calling these legal claims "meritless," stating: "the dispute is between Alaska and Virgin," while emphasizing they are not directly involved in this case.