An important update as a Shanghai court hearing this morning confronted Shenzen, 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 whereas Apple pushes aggressively with claims it did acquire 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 country-wide import and export ban on iPad, which enjoy a 76 percent share in China.
If enforced, the ban could easily disrupt worldwide iPad availability as the tablet is being manufactured by the world’s largest contract manufacturer Foxconn at their plants located in the Chinese province of Shenzen. Worse, it could disrupt a future iPad 3 launch, allegedly scheduled for March 7 unveiling. So yeah, it’s all about money.
Proview representatives presented as court evidence the company’s 2000 iMac-lookalike named IPAD, pictured on the right. Their lawyers came down all guns blazing on Apple, saying “Apple has no right to sell iPads under that name”. Their CEO told reporters that “both sides have willingness to negotiate”, asserting that “both sides will submit their plans before the talks” as 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.
Reutersfollowed 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 hasn’t 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, saying any public good achieved through the creation of iPad manufacturing jobs in China and tax revenues shouldn’t 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 had purchased the worldwide rights to the iPad trademark in ten 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 isn’t helping Apple much in its broader legal dealings with Proview, which has been pushing aggressively for a country-wide ban on iPad imports and exports in China in the hope that Apple would settle.