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Apple pays up to end iPad trademark row

Jul 02 2012 12:10 AFP

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Shanghai - Apple has paid $60m to end a dispute over who could use the iPad name in China, a court said Monday, giving the US tech giant more certainty in selling its tablet computer in the Chinese market.

Apple paid the sum last week to settle its long-running legal battle with Chinese computer maker Shenzhen Proview Technology, the High Court of the southern province of Guangdong said in a statement.

"This means that the dispute between Apple and Shenzhen Proview over the rights to the iPad brand is resolved in a satisfactory manner," said the statement posted on the court's website.

The amount paid by Apple was well below the $400m demanded by the Chinese firm.

Both Proview, based in the southern city of Shenzhen, and Apple had claimed ownership of the Chinese rights to the "iPad" trademark.

Proview's Taiwanese affiliate registered "iPad" as a trademark in several countries including China as early as 2000 - years before Apple began selling its hugely successful tablet computer.

Apple subsequently bought the rights for the global trademark - including from the Taiwanese affiliate.

But the Shenzhen branch of Proview said the deal did not include the rights for mainland China and the two sides had been locked in a legal feud since the China launch of the iPad in 2010.

Proview urged Chinese authorities to ban the sale, import and export of the iPad late last year after a Guangdong court issued a ruling against Apple.

However, although a few Chinese cities reportedly ordered iPads to be seized, those calls were largely ignored.

The Chinese firm also sued Apple in China's commercial hub of Shanghai and in the US state of California, but the lawsuits were thrown out.

A lawyer for Proview, Xie Xianghui, said the debt-ridden Chinese company had originally sought $400m in compensation for giving up the rights but settled for the lower amount out of "practical" considerations.

"We previously hoped that the compensation would be $400m, so that it would be enough to pay back all the debts," Xie told AFP on Monday.

"We have to say it is the practical choice. It is a comprehensive settlement and the end of the lawsuit in mainland China."

Xie said Proview felt "pressure" to settle, though he declined to say why.

"Court mediation gave us some pressure," he said.

Analysts said the Chinese government wanted the matter resolved, wary of the damage a ruling against Apple could do for the foreign business climate in China.

It is rare for a Chinese enterprise to accuse an overseas firm of trademark breaches - although foreign companies frequently complain of intellectual property rights violations in China.

"It was clear the Chinese government would prefer a settlement," said Shaun Rein, managing director for Shanghai-based China Market Research Group.

"For Apple, it's a cheap settlement. For Proview, they just needed the cash."

The legal battle did not halt sales of the iPad through Apple's five retail stores in mainland China, its online store and many licensed dealers.

But, amid uncertainty over how the Chinese courts would rule, the row loomed as a potential huge roadblock for Apple if it lost.

Rein said the settlement should allow Apple to focus more clearly on China.

"Having these rights, they don't have an excuse anymore to be slow in introducing the new iPad line into China," Rein said, adding that although Apple products were wildly popular in China the company could still do much better.

Greater China - which includes Hong Kong and Taiwan - has become Apple's fastest-growing region, with revenues second only to the United States.

Apple officials did not respond to requests for comment on Monday's announcement.

apple  |  ipad
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