Apple, known for being trendsetters in the personal electronics industry, must have thought its trademark troubles were over when they settled a court battle over the right to use the name ‘iPad’ in China for $60 million (£38.3 million).
The long legal battle over the iPad name started when Proview Technology, a now-defunct monitor sales company in China, registered the name IPAD in 2000. Unable to market or produce any device under this name, they sold their rights to the name in 2009 when Apple eventually acquired the trademark.
However, Proview claimed that it sold their mark under the assumption that it was not to be used on consumer electronics devices, and that it sold the rights to its IPAD mark to IP Application Development LTD, not Apple. It also claimed that Proview’s Taiwan affiliate sold the name IPAD when it had no rights to sell the name rights in China.
That settles it?
The contention over the name IPAD led to a ban on Apple’s iPads in several parts of China, which was a marked blow to the computer company because of China’s growing market for consumer electronics. As Apple’s products sat on the sidelines, banned from sales, Samsung’s Galaxy tablet and smartphone lines and other competitors were free to snap up consumers.
The $60 million settlement was supposed to change all of this, and indeed a few dozen Apple fans waited outside stores for the chance to be the first to buy the new iPads on 20 July, after the ban was lifted. However, a new move by Proview’s lawyers, Grandall Law Firm, may hurt Apple’s chances of getting its iPads on Chinese shelves once more.
The law firm is now requesting temporary seizure of the trademark until they receive payment from the Apple-Proview settlement.
Proview sued by own lawyers
Though they eventually shelled out millions, Apple may get caught in the crossfire of a lawsuit between Proview Technology and their own lawyers. Grandall’s move to take the IPAD trademark is simply a way of getting at Proview, who they say owes them payment of $2.4 million (£1.6).
Lawyer Xie Xianghui claims that Proview has repeatedly rejected requests to get paid its four percent fees. Meanwhile, Yang Rongshan, founder of Proview, has reportedly claimed that his company is not operating at normal capacity and therefore should not be made to pay Grandall’s fees immediately.
Some reports say that Proview Technology’s debt is as high as $400 million (£255 million), with its list of creditors including state-run Bank of China. It’s very likely that Grandall law firm will have to take its place in line with the rest of the debtor, who will all need to fight for their share of Apple’s $60 million settlement.
The Chinese market is a magnet for exporters but presents its own unique challenges, none more so than in the field of trade marks, as many other major brands such as Nokia have found. The unique system of sub-classes can be a minefield for the unwary, and shrewd should always take advice from an expert lawyer.