iPad Issues in China: Amazon Not an Authorized Retailer, Apple's Victory in Hong Kong Trademark Case

Earlier today, we noted that the iPad had been pulled from sale at online retailers Amazon China and Suning.com, with the development coming just days after authorities had seized some iPads over a trademark dispute involving the "iPad" name. At the time of the removal, an Amazon China spokesperson indicated that the iPad had been removed at Apple's request rather than as a result of actions associated with the trademark dispute, but Apple's reasons for the request were unknown.

The Wall Street Journal now reports that Apple did indeed request that Amazon China remove the iPad from sale, simply due to Amazon China not being an officially authorized retailer.
The Cupertino, Calif., consumer electronics giant asked Amazon in China to stop selling iPads because it is not an authorized reseller, according to people familiar with the matter. Amazon has since removed iPads offered by other resellers on its Chinese website as well.
The report's sources indicate that the move was not specifically related to the ongoing trademark dispute, although the timing suggests that it perhaps did play some role in the decision, if only by spurring Apple to reassess iPad distribution in China and tie up any loose ends.

While Chinese courts have so far ruled against Apple in the trademark dispute with Proview Technology, Apple has noted that it did win a court case on the issue in Hong Kong last year. The Wall Street Journal's report offers some additional details on that decision, which held that Proview and its subsidiaries had conspired against Apple in a scheme to extract more money from Apple.
The court said, in its findings, that Proview, its subsidiaries and at least one other company had combined together "with the common intention of injuring Apple," by breaching the agreement over the iPad name. The court, calling the event a conspiracy, further said Proview had "attempted to exploit the situation as a business opportunity," by asking for money.

"It is accordingly important that (Apple) is able to secure and obtain the China trademarks," the court wrote in its decision.
Proview reportedly failed to transfer the iPad trademark assignment in China to Apple as required by a 2009 agreement, instead demanding that Apple pay $10 million for the rights. Proview is now seeking as much as $1.6 billion in damages in Chinese courts.

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103 months ago
A conspiracy? Proview trying to extort Apple for money? Who knew??
Rating: 14 Votes
103 months ago
I keep failing to see the 'damages' APPL has caused using the trademark.
Rating: 11 Votes
103 months ago
The Hong Kong ruling can be read here:

It is an order to all, including Proview Shenzhen, which is a defendant in the Hong Kong case. It also alleges that Proview Shenzhen also signed the contract where Proview Electronics said it was the owner and would transfer the marks to IP/Apple.

Eventually, IP Application and Proview Holdings, Proview Electronics and Proview Shenzhen (“the Contracting Defendants”) entered into a written agreement in December 2009 whereby the Contracting Defendants agreed to sell, transfer and assign the Subject Trademarks to IP Application for £35,000 (“the Agreement”).

9. It is Apple and IP Application’s case that in the process of drawing up the formal written agreement (“the Written Agreement”) and the assignments (“the Country Assignments”) to give effect to the Agreement, the representatives of the Contracting Defendants represented and led IP Application to believe that all the Subject Trademarks, including in particular the China Trademarks, were owned by and registered in the name of Proview Electronics. Accordingly, the Written Agreement and the Country Assignments executed on 23 December 2009 expressly stated that Proview Electronics was the proprietor of the Subject Trademarks including the China Trademarks and that Proview Electronics warranted that it was the unencumbered sole owner of the Subject Trademarks including the China Trademarks. The Country Assignment pertaining to the China Trademarks (“the China Country Assignment”) also recited that Proview Electronics was the proprietor of the China Trademarks. However, after Apple had announced the launch of iPads in January 2010, it was discovered that the China Trademarks were in fact registered in the name of Proview Shenzhen. The China Country Assignment was accordingly ineffective in assigning the China Trademarks to IP Application.

39. In performing of the Agreement, IP Application had paid £35,000 for the Subject Trade Marks (including the China Trademarks) on 23 December 2009. It is plainly arguable that the circumstances of the present case are such that the court may order specific performance if IP Application succeeds in its claim for breach of contract. There is accordingly clearly a serious question to be tried that Proview Shenzhen now holds the China Trademarks on trust for Apple and IP Application.

41. There is clearly a serious question to be tried that each of these requirements are made out in the present case :

(a) there exists a trust by reason of the matters set out in Part D.2.c above;

(b) Proview Shenzhen has acted in breach of trust by reason of its refusal to transfer and assign the China Trademarks;

(c) other defendants have induced and/or assisted in Proview Shenzhen’s breach; and

(d) such inducement and/or assistance is dishonest.

Here, the conduct of all the defendants demonstrate that they have combined together with the common intention of injuring Apple and IP Application by acting in breach of the Agreement. Proview Holdings, Proview Electronics and Proview Shenzhen, all clearly under Yang’s control, have refused to take any steps to ensure compliance with the Agreement so that the China Trademarks are properly assigned or transferred to IP Application. Instead, they attempted to exploit the situation as a business opportunity for the Proview Group by seeking an amount of US$10,000,000 from Apple.

Rating: 8 Votes
103 months ago

Seems smart move. Pull iPads (and other apple products) from resellers. Resellers loose money. Can't feed familly. Resellers take it out on proview and, chinese officials etc. china puts proview in its place and backs apple. Apple wins without fighting.

There were 45 iPads confiscated. Most likely by cops who saw an opportunity to get an iPad without paying. I would bet two cents that these iPads have been sold since, within China.
Rating: 5 Votes
103 months ago

Does Apple and Disney have enough money to fund a private Army to overthrow the Red Chinese? This would solve a lot of problems.

Sure, but it would be a mickey mouse outfit.
Rating: 5 Votes
103 months ago

Win the case in Hong Kong means nothing because the law in HK doesn't apply to China.

actually it means everything. Mainland Chinese will just buy iPads from Hong Kong and sell it in Mainland unofficially.
Rating: 5 Votes
103 months ago

Macrumors and WSJ are distorting facts here and make it sound like its Proview's fault.

Truth is today there is no such as a single "Provew". Today Proview Shenzhen and its parent company are two seperate and independent entities sharing merely a name. Proview Shenzhen = the creditors of Proview Shenzhen.

The whole group is on the brink of bankrupcy and its oversea parent company lost control over Proview Shenzhen to the creditors.

Yes Proview Shenzhen's parent company agree to casue Proview Shenzhen to transfer the trademark.

But Proview Shenzhen is taken over by its creditors. And whatever its parent company as its shareholder say or decide (transfer of the trademark) is not binding on Proview Shenzhen unless they are able to repay the debts.

It's like whatever you agree to do(and court asked you to do) , you cannot legally do it unless you actually legally control it.

It is well within the legitimate rights of the creditors (aka Proview Shenzhen) to refuse to transfer the trademark, since the parerent company lost is legal power to tell Proview Shenzhen what to do. The HK court's ruling is absolutely correct. But it is a useless ruling because whatever the HK court require the parent company to do, the parent company had already lost its power and legal capacity to do so.

I do not understand why such simple facts become portrayed in a way like the country and its government is bullying Apple.

Should this happen in any other western country, Apple would in even bigger trouble, since Apple is clearly infringing a trademark legetimately owned and used by someone else for over a decade. The blame is totally on Apple. When you purchase something, it is your responsibility to find out whether the seller actually owns that thing. If you failed to do so, you bear the consequences. Simple as that.

That's a very well reasoned argument, but I'd like to learn some facts, which most media outlets lack. Specially the timeline of the deadline for the trademark transfer and when the creditors got involved. Also the legal agreement when the creditors signed on, was there a clause not to interfere in previous contracts/agreements.

There's also the idea of "good faith" meaning Apple thought that they own they rights through their purchase, so they can't be penalized too harshly, at least under Hong Kong law.

If Proview wins this, it will probably hurt American public opinion about China, something which is not going to go well on top of all the complaining about American manufacturing going to China.
Rating: 4 Votes
103 months ago

Also sounds like apple cheated the guy.

Apple nearly always use third party companies to purchase names. Otherwise the whole world would have a better bet at what they were working on. It's not cheating – it's common sense.
Rating: 3 Votes
103 months ago
Win the case in Hong Kong means nothing because the law in HK doesn't apply to China.
Rating: 3 Votes
103 months ago

So apple cheated this guy by sending in a smaller company to buy the iPad name. If apple had gone in themselves to buy it the guy would have asked for more money.

Why should that happen?
When I go buy something, I am asked for a price, not how much money I have (nor who am I and what I want it for). Should it be different?

I think it is more typical to be asked how much money one has when being mugged :P.
Rating: 2 Votes

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