Apple Inc. has paid $60 million to settle an iPad trademark lawsuit in China with Proview Technologies. The hefty settlement ends the protracted legal dispute between the two companies while clearing way for Apple to continue sale of its gadgets in the Chinese market.
The dispute revolved around the iPad trademark, which initially belonged to Proview Technologies, a Chinese firm. While Apple had bought the global rights to the iPad from Proview’s Taiwanese affiliate for $55,000, Proview argued that its affiliate did not have the authority to sell the trademark rights for China.
The lawsuit had not only blocked sales of the iPad that were already in the market, but also delayed the introduction of the latest iPad in China. Proview even sought to ban sales of the iPad in Shanghai because of the dispute, but the courts rejected its appeal.
However, on Monday, the Higher People’s Court of Guangdong province confirmed in a statement, according to a report by BBC, that "the iPad dispute resolution is ended," adding that "Apple Inc. has transferred $60m to the account of the Guangdong High Court as requested in the mediation letter."
The announcement will now allow Apple to sell its popular tablet in one of the most important markets, making the settlement quite a sensible move.
China offers a huge market, and as Apple CEOonce noted, Apple has only scratched the surface so far and there is a lot more growth still to come.
"The settlement is great news for Apple," said Teck-Zhung Wong, a Beijing-based analyst with technology research firm IDC, according to a report by Reuters. "It just allows them to get on with business and stop being distracted. The new iPad has been so late to the China market that if they drag it any longer, Apple will stand to lose quite a bit more."
The settlement money will allow Proview to pay back $8.86 million in outstanding debts to its creditors after one of them, Fubon Financial Holdings Co. Ltd., applied for bankruptcy proceedings against Proview in March.
"The settlement fee is not bad for Proview, because although Proview owns the trademark, it was Apple, not Proview, who created the brand's value," said Chen Jihong, a Beijing-based intellectual property rights lawyer at Zhong Lun Law Firm.
Shares of Apple were up by 1.3 percent following the announcement.