Posted on 02 Jul 2012
Apple Inc. will pay $60 million to settle a trademark dispute with a Chinese company over the iPad name, according to a Chinese court, potentially resolving a case that illustrated new intellectual-property challenges for foreign businesses in China.
An attorney for the China-based unit of a Hong Kong computer monitor maker, Proview International Holdings Ltd., said on Monday that the settlement had been reached via mediation. A post on the official microblog account of the Guangdong High People's Court's confirmed that settlement had been reached as well as the settlement amount, and said it took effect on June 25.
"Personally I am happy to see the settlement by the Guangdong high court," said the attorney for the Proview unit, Ma Dongxiao. "As we all know that Apple has made iPad such a big name, I don't think that brand could do Proview a lot of good even if Proview won it. So this is a good solution for both sides."
If the settlement resolves other court fights between Proview and Apple related to the iPad name, it would remove a cloud over Apple in what has become a crucial market. High demand for iPhones and iPads has made China Apple's biggest market outside the U.S., representing 11.5% of Apple's global revenue in 2011, or roughly $12.5 billion. Apple shipped an estimated 4.1 million tablets there last year, according to research firm IDC.
Apple has said it purchased rights to the name from Proview as part of a 2009 agreement. But Proview's China unit, Proview Technology (Shenzhen) Co., had said it still owned the China rights. A lower Chinese court in December sided with Proview, prompting Apple to appeal to the higher court.
Proview had ratcheted up pressure against Apple as the case went on. Claiming trademark infringement, the Chinese company applied to customs offices around the country to halt the import and export of iPads. Apple makes the iPad in China through contract manufacturers.
The case has intensified the focus around intellectual property rights in China, an increasingly important consumer market as well as a manufacturing base. According to the World Intellectual Property Organization, Chinese entities registered more than 1.2 million trademarks around the world in 2010, an almost 10-fold increase from 2000 and almost five times as many as were registered by U.S. entities.
According to the latest government statistics, about 50,000 intellectual property cases were litigated in 2010 in China. Though many high-profile cases involved foreign companies, such as Apple's current dispute with Proview, most cases are disputes between Chinese compan