An important update as a Shanghai court hearing this morning confronted Shenzhen, China-based LCD display maker Proview and Apple of California, the maker of the widely popular iPad tablet. The high-profile hearing drew more than a hundred reporters. As you know, Proview is dreaming of a multi-billion dollar settlement for rights to the iPad name in China where Apple pushes aggressively with claims it acquired the iPad trademark in 2009 from Proview’s Taiwanese affiliate for about $55,000. Associated Press this morning described a heated exchange between cash-strapped Proview, which recently filed for bankruptcy, and the Silicon Valley giant. At stake: A countrywide import and export ban on the iPad that enjoys a 76 percent share in China.
If enforced, the ban could easily disrupt worldwide iPad availability, because the world’s largest contract manufacturer Foxconn at its plants in the Chinese province of Shenzhen manufactures the tablet. Worse, it could disrupt a future iPad 3 launch allegedly scheduled for March 7 unveiling. So yeah, it is all about money.
Proview representatives presented as court evidence the company’s 2000 iMac-lookalike named IPAD (pictured on the right). The lawyers came down with all guns blazing on Apple, and said: “Apple has no right to sell iPads under that name.” The company’s CEO told reporters “both sides have willingness to negotiate,” and asserted, “both sides will submit their plans before the talks,” because an out-of-court settlement “is quite possible.”
To this, Apple responded:
They have no market, no sales, no customers. They have nothing. The iPad is so popular that it is in short supply. We have to consider the public good.
Reuters followed up with another quote attributed to Apple’s legal team:
Apple has huge sales in China. Its fans line up to buy Apple products. The ban, if executed, would not only hurt Apple sales but it would also hurt China’s national interest.
Explaining Proview has not sold or marketed its IPAD computer system in years while Apple only began selling the iPad tablet in 2010, the company said the fact essentially invalidates Proview’s trademark. Lawyers for Proview cried foul, and claimed any public good achieved through the creation of iPad manufacturing jobs in China and tax revenues should not be confused with trademark infringement:
Whether people will go hungry because you can’t sell iPads in China is not the issue. The court must rule according to the law. Do you absolutely have to sell the product? Can’t you sell it using a different name?
The ruling in this case may not be reached for weeks, if not months. Apple’s legal woes with Proview began last July when a Hong Kong court ruling revealed that Apple founded a United Kingdom-based company to snatch rights to the iPad trademark in various markets without revealing it was the purchaser. Apple maintained it purchased the worldwide rights to the iPad trademark in 10 different countries in 2009 from Proview’s Taiwanese affiliate for about $55,000, including rights to market the iPad in China. When Proview sued, Apple accused them of not honoring that agreement. A Hong Kong court sided with us in this matter, Apple said. However, legal systems in Hong Kong and Mainland China are not very much alike, so the Hong Kong ruling is not helping Apple much in its broader legal dealings with Proview, which is pushing aggressively for a country-wide ban on iPad imports and exports in China in the hopes that Apple would settle.
- The price of the iPad name in China has gone up to $2B (9to5mac.com)
- Apple finally talks, says that Proview refuses to honor their agreement to transfer iPad trademark (9to5mac.com)
- Proview tries to block iPads from coming in or going out of China (9to5mac.com)
- Proview: “We are now preparing for negotiations with Apple” (9to5mac.com)
- Lower Chinese court rules distributors should stop selling iPads in China (9to5mac.com)
- Proview sues retailers in Southern China seeking ban on iPad sales (9to5mac.com)
- Chinese customs: iPad too powerful and popular to be banned (9to5mac.com)