The film featuring an awesome cast of Amitabh Bachchan, Shah Rukh Khan, Preity Zinta, Abhishek Bachchan, Rani Mukherjee and Arjun Rampal (who does a small walk-on part) is ready to roll in September.
In fact, Karan was in the US finalising the screenplay and locations when he received a bombshell.
An unknown filmmaker named Biswaroop Roy Chowdhury is also set to make a film entitled "Kabhi Alvida Na Kehna".
Chowdhury is apparently the national memory record-holder in the Limca Book of Records and has completed a film called "Yaad Rakhenge Aap", which he claims is the world's "first memory movie" - whatever that means.
According to him: "Karan Johar is also making his next film with the same title. However, I'm legally authorised to use this title because it has been registered by me." Chowdhury has said he will begin the filming of his movie by June 21.
Karan, who is in London after attending the IIFA awards in Amsterdam, is more exasperated than aghast.
"Who is this person? I've never heard of him. I don't wish to know him. How can he claim to have a legal right over my title? You're aware of how much difficulty I had to go through to get 'Kabhi Alvidaa Na Kehna', he told over telephone from London.
"It was the only title for my film. I had to hunt for Aruna Iraniji, who actually had the rights, and request her to relinquish the title. She was terribly sweet about it. She told me, 'Beta, it's all yours. All I want in return is a big hug and kiss from you'."
"Next, I had to request Vinod Pande who was in the wait list for the title. He too graciously backed out and let me have the title."
Lucky Karan. Years ago Amitabh Bachchan had personally requested Vinod Pande to give over the title "Sach" for a film starring the Big B. Pande refused. The film finally had to be titled "Main Azaad Hoon".
More recently, the title "Devdas" had been registered with Prem Chopra's brother. All of director Sanjay Leela Bhansali's requests fell on deaf ears, until the matter was sorted out at the last minute.
So, is Karan set for a long drawn battle over his chosen title?
"Are you mad?" he screams. "I've absolutely no time or energy for such silly battles. Obviously this gentleman has found a way of getting noticed. It doesn't mean I'm going to oblige him.
"This is the toughest film of my career. I've gone into situations and dialogues about the man-woman relationship that I've never touched on before. The last thing I need is trouble over the title. 'Kabhi Alvidaa Na Kehna' is my title. No one can take it away from me."