Feb 28, 2012

What are the chances that Apple's legal dispute with Proview will impact iPad sales in the US?

Proview has been claiming rights to the iPad trademark in China for quite a while now, and has succeeded in getting stocks of iPads seized in some Chinese cities. I saw a report today that Proview is filing suit in the US claiming ownership of the trademark and alleging the rights to the iPad trademark was fraudulently obtained by Apple. We've seen German courts stop push email from Apple, the ongoing dispute with Samsung in Europe, the aforementined seizures in China, and now this suit. Is there a real possibility that Apple could be stopped from selling the iPad in the US as a result of this fight?

The lawsuit Proview filed in the US is unlikely to be successful. As I understand it, they are claiming fraudulent behavior by Apple in the original purchase of the rights to the iPad name. That's going to be a pretty difficult thing to prove, and claiming that Apple had its own undisclosed motives for purchasing the name doesn't mean that the purchase was invalid. A contract is in the end simply bargained for exchange, and motivation isn't a cause for invalidation, absence something more. Selling someone a paint by numbers painting for a million dollars by telling the buyer it is a Monet is fraud. Buying a trademark because you intend to use it for your own product is not.

I suppose there is a chance that the legal fight in China could disrupt sales in the US, but I don't think the chances are very high. China is important to Apple, who has said that its China stores have the highest traffic and revenue of all its stores, and if the really unexpected occurred and a court ordered the cessation of any iPad manufacturing, there would be an immediate reaction. If it really comes down to it, I'd expect cost-benefit analysis to move Apple to just pay up, even if they are absolutely convinced Proview's claim is bogus. The irony is that China has pretty much zero respect for copyright and trademarks, as can be seen by the flood of counterfeit items that constantly pour out of the country.
I doubt Apple will be stopped from selling iPads in the US. They might have to pay Proview some money for the rights to the iPad trademark though, but there's no way to know exactly how it will play out. We'll have to sit tight and see what happens with all of these lawsuits. At some point they will be resolved, one way or another.


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