LONDON, July 3 (Reuters) – British billionaire Richard Branson severely broken Virgin Group's popularity by residing in a tax haven whereas UK-based airline Virgin Atlantic sought a authorities bailout in the course of the pandemic, in line with inside Virgin emails cited in a $250 million London lawsuit on Monday.
The emails have been cited by legal professionals for U.S. practice operator Brightline, which is being sued by the Virgin Group after cancelling a deal to make use of the Virgin model in 2020, simply over 18 months after it was signed.
Underneath the deal Brightline operated a rail line in Florida utilizing the identify Virgin Trains USA.
Brightline says it cancelled the deal as a result of the Virgin model had been hit by unfavourable press protection of Branson's 2020 declare that Virgin Atlantic would want a bailout from the British authorities to outlive the pandemic.
Brightline's legal professionals cited inside Virgin Group emails describing group founder Branson being based mostly within the British Virgin Islands for tax functions as “a popularity killer”, whereas one e-mail from an exterior public relations adviser stated: “Richard wants to point out he isn't a ruthless, tax-evading billionaire.”
In an April 2020 e-mail, Virgin Group CEO Josh Bayliss referred to Branson's tax residency in relation to the request for a bailout, saying: “Richard can't escape the criticism. The reality is he has paid as little tax as attainable”.
Virgin argues its model was not materially broken by the group's dealing with of COVID-19, which means Brightline was not entitled to cancel the licensing deal with out paying an exit charge of as much as $200 million. The corporate can be searching for unpaid royalties.
Virgin's lawyer Daniel Toledano stated in court docket filings that the model suffered some unfavourable press in Britain in 2020 following Virgin Atlantic's request for presidency help, however its popularity shortly recovered and was unaffected in the US.
Brightline's lawyer Nigel Tozzi, nevertheless, stated the deal had entitled his shopper to a model with a excessive worldwide popularity, like Coca-Cola or main European soccer groups Actual Madrid and Barcelona.
“It's the Beatles, not the Bay Metropolis Rollers,” he stated in court docket filings.
Reporting by Sam Tobin; Enhancing by Susan Fenton
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