updated 02:00 am EST, Wed February 29, 2012
Could be decisive battle in trademark fight
What could be the final battle in the legal war between Apple and debt-ridden Proview Technology, the Higher People's Court of Guangzhou is hearing an appeal from the iPad maker over rights to the name "iPad" in China, which Apple says it bought from Proview but which Proview claims it didn't. While Apple has gotten the upper hand for the moment in preventing Proview from blocking iPad sales in China, the victory might be temporary.
Despite documents and a recent lower-court ruling that clearly show Apple bought the rights to the name "iPad" in China and ten other countries from Proview in December of 2009, the company has been partially successful in convincing Chinese courts that the transaction was a case of "one hand not knowing what the other was doing," along with its latest argument that, as it was in receivership during the transaction, its creditors should have had more of a say in the deal.
The way Apple went about acquiring the trademark may also be a contentious issue with Chinese courts. As is typical for large companies, Apple set up a dummy corporation to negotiate the rights for the trademark, fearing that it's multinational status would drive up the price and give Proview more leverage. Thinking they were selling the trademark to Intellectual Property Application Development Limited (IPADL), Proview eagerly sold the trademark to its money-losing and discontinued IPAD computer for around $55,000.
While the documents seem to make it clear that Apple's front company acted in good faith to acquire the trademark, the bankrupt Proview is likely hoping that playing the victim of duplicitous western interests will force Apple to re-negotiate the trademark sale in China in an effort to pay off creditors. Proview, which has largely focused on display technology, made an IPAD touch-screen personal computer that resembled the early iMac (ironically) in the late 90s. Some of China's largest banks are among Proview's creditors, and the company's actions increasing appear aimed at appeasing them rather than benefiting the company.
Proview has made it plan that it is angling for a settlement, having expressed the hope in media channels and using mostly-unsuccessful tactics like trying to intimidate stores into taking the iPad off shelves or attempting to impose import/export bans while the case drags on. Apple has said simply that "Proview is refusing to honor its agreement" and has consistently maintained, even in the face of some court losses, that it specifically bought and owns the iPad trademark in China. It has argued that an iPad sales ban would hurt both itself and the entire Chinese economy, since iPads are mostly manufactured in China.