Apple Settles iPad Trademark Case with $60m

US technology giant Apple Inc (Apple) has settled a lingering dispute with a local technology company concerning the use of the iPad trademark for the California-based tech giant's popular tablets computers in the Chinese mainland.

According to Guangdong High People's Court, Apple has ended their long-running iPad name dispute in China with Proview with a $60 million settlement. The mediation letter was sent to both sides and came into effect on June 25. A request has been made by Shenzhen Intermediate Court to the State Administration for Industry and Commerce on July 2 to transfer the iPad name from Proview Shenzhen to Apple.

Long-running dispute

US technology giant Apple Inc (Apple), IP Application Development Limited and Shenzhen Proview S&T company have been entangled in a drawn-out legal battle for many years.

IP Application Development Limited intended to buy Proview's worldwide rights to the trademark for the iPad name in different countries in August 2009 from British Proview Company.

The Proview Taiwan unit eventually signed a trademark transfer agreement on December 23 2009 that IP Company obtained ten registrations of the “iPad” trademarks through assignment, including the trademarks for the Chinese market for 35,000 pounds.

IP Application Development  Limited then sold the ten trademarks for “iPad name” to Apple for 10 pounds in February 2010.

However, Proview Technology (Shenzhen) says the sale did not cover the trademark's use in China, where it owns the iPad name. Apple then asked Shenzhen Proview to change the two ownership registration and encountered brush-off. Shenzhen Proview held the trademarks right for the Chinese market did not belong to Taiwan Proview and the sale did not cover the trademark's use in China, where it owns the iPad name.

The case was heard by Shenzhen Intermediate Court in May 2010. The court held the Taiwan Proview could not represent the Proview Shenzhen to sign the agreement and Apple also could not furnish the new evidence to proof. The case was rejected by the court in its first-instance decision. Then the two disgruntled companies brought the case to the Guangdong High People's Court.

Guangdong High People's Court heard the case on February 29 of this year. The two sides launched out into a violent debate over the case. After careful investigation and analysis, the collegial panel maintained the settlement is the best way for both sides to achieve maximum mutual benefit. The two sides signed the mediation agreement to end their long-running iPad name dispute in China with a $60 million settlement.

Win-win outcome

The settlement is unsurprising.

Apple will be soon to obtain the “iPad” trademarks in China's mainland.  It's a good news for Apple because the settlement cleared the last obstacle for the new iPad entering the mainland market and the money will be used to pay Proview's debts.

For Apple, the settlement with 60 million USD can help it seize huge market opportunities in China. Otherwise, Apple might not have been able to sell its new popular tablet computers in the Chinese mainland which contributed over 20% of Apple's revenues. For the company's benefit, it is a good deal to exchange money with time on the trademark case.

The settlement with 60 million USD also helps Proview Shenzhen use the money to cover its debts and the interests of its creditors to be better protected.
Many IPR experts conclude that the settlement with 60 million USD embodied the values of trademark of iPad. The settlement allowed Apple to get on with selling its popular tablet computers in one of its most important markets which showed the importance of trademark in competing for enterprises. For the judicial trial, the settlement might be principal solution for trademark disputes involving foreign entities.   

(China IP News)