Library of Congress

Law Library of Congress

The Library of Congress > Law Library > News & Events > Global Legal Monitor

China: Court Announces Apple and Proview Settlement of iPad Trademark Dispute

(July 16, 2012) The Guangdong Higher People's Court announced earlier this month that Apple and Proview Technology (Shenzhen) Ltd. have settled their dispute over the rights to the iPad trademark in mainland China, with Apple paying Proview US$60 million. The resolution was first announced by the Higher Court's profile-verified microblog on July 1, 2012. (Guangdong Higher People's Court microblog [in Chinese] (July 1, 2012).) The next day, the Higher Court issued a statement with more details on its official website. (Guangdong Gaoyuan Chenggong Tiaojie Pingguo yu Weiguan IPAD Quanshu Jiufen An [Guangdong Higher Court Succeeds in Mediating the Apple Proview Dispute over IPAD Trademarks] Guangdong Courts website (July 2, 2012).)

According to the Court statement, Apple and Proview Shenzhen reached the settlement through in-court mediation conducted in the Higher Court. On June 25, the Higher Court served upon both sides the Civil Mediation Agreement. Apple was said to have transferred the $60 million to an account designated by the Higher Court. In the meantime, the first instance trial court in the case, the Shenzhen Intermediate People's Court, has notified the State Industry and Commerce Administration Trademark Bureau of the transference to Apple of the rights to the trademark. (Id.)

The high-profile dispute started in 2009 and 2010, when Apple, through a shell company, purchased ten iPad trademarks registered in different countries from Proview Taiwan for £35,000 (about US$54,500), including that registered by Proview Shenzhen in mainland China. Proview Shenzhen, however, rejected Apple's request to transfer the rights to the iPad trademark. According to Proview Shenzhen, the rights to the trademark in mainland China are owned by Proview Shenzhen, and Proview Taiwan did not have the right to sell them. Apple sued Proview Shenzhen in the Shenzhen Intermediate People's Court in May 2010 and lost. Some of the local industry and commerce bureaus in north China ordered that iPads be taken off the shelves thereafter. (Id.; Apple's iPads Taken Off the Shelves in North China, CHINA LAW & PRACTICE (Feb. 15, 2012).)

Apple's appeal of the case was heard by the Higher Court on February 29, 2012. The Court asked Apple and Proview to go through mediation through in-court discussions. Apple was reported to have offered to pay Proview Shenzhen US$16 million, with Proview Shenzhen seeking US$400 million. Proview Shenzhen is facing bankruptcy, and this iPad trademark is the company's most valuable property, according to the Court statement. In its statement, the Higher Court refers to comments from industry experts saying that the resolution “maximizes the value of the iPad trademark and the Proview debtors' interest is protected to a great extent.” (Guangdong Gaoyuan Chenggong Tiaojie Pingguo yu Weiguan IPAD Quanshu Jiufen An, supra; David Tring, Apple, Contracts, Trademarks, and Due Diligence: Lessons from the Proview Dispute, CHINA LAW & PRACTICE (July 5, 2012).)

With the dispute settled, Apple will start selling the newest iPad in China from July 20. (Apple to Start Selling Newest iPad in China July 20 After Settling Name Dispute, ASSOCIATED PRESS (July 10, 2012).)