The Asian firm trying to stop Apple Inc from using the iPad name in China has launched an attack on the consumer electronics giant’s home turf, filing a lawsuit in California that accuses the iPhone-maker of employing deception when it bought the “iPad” trademark.
A unit of Proview International Holdings Ltd, a major computer monitor maker that fell on hard times during the economic crisis, is already suing the U.S. company in multiple Chinese jurisdictions and requesting that sales of iPads be suspended across the country.
Last week, units Proview Electronics Co Ltd and Proview Technology Co filed a lawsuit in Santa Clara County that brings their legal dispute to Silicon Valley.
Proview accuses Apple of creating a “special purpose” entity – IP Application Development Ltd, or IPAD – to buy the iPad name from it, concealing Apple’s role in the matter.
In its filing, Proview alleged lawyers for IPAD repeatedly said it would not be competing with the Chinese firm, and refused to say why they needed the trademark.
Those representations were made “with the intent to defraud and induce the plaintiffs to enter into the agreement,” Proview said in the filing dated February 17, requesting an unspecified amount of damages.
Apple, which has said Proview is refusing to honor a years-old agreement, did not respond to requests for comment on Thursday.
The battle between a little-known Asian company and the world’s most valuable technology corporation dates back to a disagreement over precisely what was covered in a deal for the transfer of the iPad trademark to Apple in 2009.
Authorities in several Chinese cities have already seized iPads, citing the legal dispute.
Proview, which maintains it holds the iPad trademark in China, has been suing Apple in various jurisdictions in the country for trademark infringement, while also using the courts to get retailers in some smaller cities to stop selling the tablet PCs.
China is becoming an increasingly pivotal market for Apple, which sold more than 15 million iPads worldwide in the last quarter alone and is trying to expand its business in the world’s No. 2 economy to sustain its rip-roaring pace of growth.
The country is also where the majority of its iPhones and iPads are now assembled, in partnership with Foxconn.
A Shanghai court this week threw out Proview’s request to halt iPad sales in the city. But the outcome of the broader dispute hinges on a higher court in Guangdong, which earlier ruled in Proview’s favor.
The next hearing in that case is set for February 29.
China’s trademark system is a minefield of murky rules and opportunistic “trademark squatters” that even the world’s biggest companies and their highly-paid lawyers find hard to navigate.
Legal experts say the onus is on companies looking to do business in China to understand how China’s trademark law works, as it differs greatly from that of the United States.
Industry executives have said employing special-purpose entities to acquire trademarks is a frequent tactic in China.
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