Apple Faces $1.6 Billion Proview Lawsuit Over iPad Name

by Jenn Cano on February 17, 2012
Proview International Holdings Ltd., a debt-laden Chinese technology firm, claims it has ownership of the iPad trademark in China.  Proview Technology in Shenzhen registered the iPad trademark in China in 2001. Apple bought rights to the name from a Taiwan affiliate, Proview Taipei, but the mainland company says it still owns the name in China.  Carolyn Wu, Apple’s Beijing-based spokeswoman, said Apple bought Proview’s worldwide rights in 2009 to the iPad trademark in 10 countries, including China.

The legal battle with Apple Inc. over the iPad name started back in 2010 when Apple sued Proview’s Shenzhen-based unit, claiming ownership of the iPad trademark in China. The Shenzhen Intermediate People’s Court rejected Apple’s claims and Apple appealed that ruling to the Higher People’s Court of Guangdong province. The next hearing for this case is set for February 29.

Subsequently, Proview filed a trademark infringement case in Shanghai scheduled to begin Feb. 22 against Apple trying to halt iPad sales at Apple’s own stores in China.  They also filed separate trademark infringement complaints seeking enforcement from at least 20 local government custom agencies, some of which have started seizing iPads in local markets, Roger Xie, a lawyer representing Proview, said.  For the most part, Proview Technology has been told that it’s unlikely that China’s customs authorities will intervene because there are too many Chinese consumers that love Apple products and the sheer size of the market would be hard to control.  

On Tuesday, lawyers representing Proview Technology (Shenzhen) said the company would also seek a ban on exports of Apple's iPads from China.  The iPad is solely manufactured in China by Foxconn Technology Group.  A halt to exports from China would be “catastrophic” for Apple, a move that could deal a huge blow to the U.S. technology giant's sales globally.

Apple sold a record 15.4 million iPads globally during the three months ending in December, more than double the 7.3 million sold in the year-ago quarter, the company said last month.  Local Chinese media reported recently that Proview was taking legal action, seeking up to 10 billion yuan ($1.6 billion) in compensation from Apple for trademark infringements, saying that the compensation could be the last hope to help rescue the company which used to be one of the world's top monitor makers until the financial crisis in 2008 crippled its business and operations.

No matter the reason behind the suit, if Proview is successful in halting iPad exports from China the world is in for a major economic disruption!  Its actions like these that cripple the economy and wreak havoc on the global supply chain. 

On the other hand, it’s also situations like these that could cause major American Corporations to rethink their manufacturing strategies; giving them incentive to bring manufacturing jobs and cash back to the U.S.  Also, seeing the possibility for severe disruption in the supply chain, the I.T. aftermarket in the U.S. (made up mostly of U.S. small businesses) could receive its well-deserved relevance by being the alternative source for this equipment while the manufacturers overcome these challenges.  When disruptions such as this occur in a  global economy, a volatile market is constantly waiting in the wings, ready to erupt,  creating an ensuing need for  the I.T. aftermarket.

Topics: IT Aftermarket, Refurbished IT, IT Refurbishing, trademark infringement, IT Maintenance, Technology News

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