Apple’s iPad trademark problem in China is self-inflicted

“There’s tension brewing between the U.S. and China over ‘trademark squatting,’ the practice of grabbing trademarks under China’s rules that allow whoever registers them first to own them,” Oliver Herzfeld reports for Forbes.

“But the most high profile trademark dispute in China, Apple’s fight over the iPad trademark, is something entirely different,” Herzfeld reports. “Essentially, it is a commercial dispute triggered by Apple’s regrettable failure to properly purchase the rights to that trademark in China.”

Herzfeld reports, “Apple was simply not duly diligent in its most basic obligation as a purchaser, investigating and verifying the seller’s ownership before entering into a purchase agreement. A quick and inexpensive trademark search would have revealed that Apple was contracting with the wrong party… While Apple shouldn’t have to look far to find the cash needed to purchase the iPad trademarks in China, the question remains: How high will Proview’s asking price be?”

Read more in the full article here.

33 Comments

  1. What happened to the stories that the guy that was in charge of the China branch of Proview was the one who signed the documents selling the trademark to Apple?

    1. This guy from Forbes apparently tells his story without any reference to the on-going argument. He seems to think that the issue now in the Chinese court is a forgone conclusion and Proview is now entitled to name its price!

      1. The Article said, “Apple was simply not duly diligent in its most basic obligation as a purchaser, investigating and verifying the seller’s ownership before entering into a purchase agreement. ”

        Of course you are right but in a different way. China is so corrupt that you can do just about anything you want, legal or not and as long as the government does not feel put down in any way, they do not care. Proview sold its trademark. Now its finding that Apple owns it and they want more money…. lots more money.

        Remember, China had two Apple fake stores selling apple gear and the only thing they were mad about was that the store had not filed a building fee. In China,,,, “Crime, its the way we do business”.

        en

        So, just like any good corrupt lawyer, Apple should just give in and pay them the money. After all, lawyers are only about money. The law is just there to find loopholes and make money on…

        PS, chase any ambulances lately. ???

      1. Those documents CLEARLY say that Apple purchased the trademarks.

        I think Proview’s argument was that they sold the trademark to an intermediate company (which is normal purchasing procedure for apple, since they don’t like to give their plans away, AND a totally legal move)

        Basically, Proview regrets that they sold the trademark to APPLE for soooo cheap, when they obviously realize (in hindsight) that they could have gotten a considerable sum for it…

        So, basically they are pissed off that they missed a chance to extort apple… and are b***hing and moaning about it to the chinese courts because they feel like the courts will side with them.

        Apple LEGALLY bought the trademark.
        The trademark became worth more when apple released the iPad
        Proview is in debt and needs money.
        Proview sues apple.

        I hope that the people at Proview get the axe for this. China will *not* want to piss off apple…

  2. I’ve said it before, I’ll reiterate again: Apple can learn a thing or two about lawyering up the right way from MS. Those buggers have been getting way with murders for decades.

  3. Forbes has been relentless negative on Apple for a long time including misleading reports on the Foxconn labour ‘issue’ etc. and in this preview case it continues.

    It’s main argument in dismissing Apple’s claims that Proview asked it to purchase the iPad rights from Taiwan to protect Proview China from creditors because according to Forbes ” logically it makes no sense when you consider that, under the agreement, Apple only paid £35,000 – hardly enough to make a dent in Proview China’s debts” is just STUPID.

    Proviews manipulations was NOT to use the 35k to PAY OFF creditors but to protect the owners so that creditors can not CLAIM the 35k. The money just goes to the owner (who is registered as head of both divisions) pockets.

    and the reason was why they only asked for 35k was that they 1) they did not know that Apple was the purchaser ( Apple bought it through a third party, a perfectly legal manoeuvre ) and 2) it was before iPad was launched (who knew it was going to be such a hit?).

    yeah, maybe Apple should be more aware of the shady way much business is conduct in the ‘Wild West’ of Asia (I’ve worked there for years and know this) but to put too much blame for Apple is silly when it’s Proview which is being unethical.

    As another article points out “Both Proview Taiwan and Shenzhen are units of Hong Kong-listed Proview International Holdings”. So Proview Taiwan who is also owned by Proview International telling apple they legally own China rights when they didn’t to mislead the buyer is o.k? It’s ALL Apple’s at fault? There’s not one word of blame by Forbes on Proview. Like blaming a person who was mugged and not the mugger.

    1. Good perspective. Apple should and probably will settle for nuisance value+. In order to keep Proview in check though, they should cast a huge shadow on Proview’s future liabilities, with the threat of unrelenting litigation that will hold them ultimately responsible financially for all the consequences resulting from their extortion and bad faith.

  4. No, no. Herzfeld is really wise and Apple doesn’t know how to carry out the most simple business procedures that a one-person business would do. Yeh, that’s it.

    1. Evidence schmevidence, this is China, after all, a totalitarian Communist nation, corrupt to its core. If Apple’s lawyers can wield the right incentive in the right places, then that will decide the matter. The current instability there complicates the issue.

  5. WRONG:
    Essentially, it is a commercial dispute triggered by Apple’s regrettable failure to properly purchase the rights to that trademark in China.

    Apparently Oliver Herzfeld didn’t read Apple’s documentation which includes the fact that the court in Hong Kong, the jurisdiction designated in the sales contract, found Apple’s ownership of the ‘iPad’ trademark to be VALID last June. The court also found Proview to be in BREECH of contract. IOW: The sale is valid, Proview are lying and China’s own court says so.

    Why is this stupid issue still dragging on? Why did Oliver Herzfeld bring it up all over again? It’s way over.

  6. Why doesn’t MDN run any articles about Flashback? What is MDN afraid of? Only select fanboy news? C’mon MDN I expect thorough coverage. Apple isn’t perfect and the readers expect better from MDN.

    1. Also at 600,000, this only effects a very small percentage of users. Last numbers I heard was OS X had 54 million users; this was at WWDC 2011 and that number is sure to be higher now. That something like 1% of users, probably less as the install base is sure to be higher then 54 million by now.

    2. Besides that they did post a story, the next version of OS X Mountain Lion will solve this issue permanantly. You simply won’t be able to install software outside a known and trusted list of developers.

      It will end Trojan horse malware which is the only malware vector that has effected Macs in the past 10 years.

  7. Hey Forbes, you ought to basic background editorial checking. You would discover that Herzfeld’s “people familiar with the matter” is one Mike Daisey…….

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