Apple Inc.'s offer of US $60,000,000 on 25 June 2012 settling its dispute over the iPad trade mark in Mainland China demonstrates that even the most powerful entities cannot escape the wrath of the law because of what might be seen as a mere oversight.

The settlement puts to an end Apple Inc.'s four year battle against Shenzhen Proview whom the Courts had ruled was the rightful owner of the Chinese iPad registrations.

In 2000, Taiwan Proview registered the iPad trade mark in various countries worldwide. In 2001, Shenzen Proview filed trade mark applications for iPad in China. Important to the facts of the case are that both Taiwan Proview and Shenzen Proview are entities that are 100% owned by Proview International Holdings.

In 2009, Taiwan Proview agreed to assign all of its iPad trade marks worldwide to Apple Inc. However, in 2010 Shenzen Proview declined to sign the assignment agreement required to record the transfer of ownership of the Chinese iPad registrations at the Chinese trade mark office.

It is fair to assume that Apple Inc. conducted a prior due diligence and confirmed all particulars of the iPad trade marks worldwide.

However, the fact that Shenzhen Proview owned the Chinese registrations was not taken into account when Apple concluded the agreement with Taiwan Proview.

This is an expensive lesson for Apple Inc. to have learnt and with China being its second largest market to the USA, it is one that Apple couldn't afford not to address.

This case illustrates the importance of adequate trade mark protection and conducting prior due diligence checks when moving into other markets not only in China but worldwide, as attempts to reclaim brands can be laborious, expensive and sometimes unsuccessful.

Contact

Donvay Wegierski, director
Direct line: +27 (0)21 809 6009
Email: donvayw@werksmans.com

Janine Hollesen, director
Direct line: +27 (0)21 809 6011
Email: jhollesen@werksmans.com

Stuart Gardiner, director
Direct line: +27 (0)21 809 6010
Email: sgardiner@werksmans.com