Apple has shelled out a tidy sum of £38.3m in order to settle a legal dispute in China over the rights to the iPad name.
The Cupertino-based Tech giants have now removed a potentially tricky obstacle to sales of the tablet in the important Chinese market.
This long-running legal wrangling the likes of which seem to follow Apple around like an unwanted halo highlighted the potential problems facing technology companies looking to trade within China’s trademark system.
The dispute with Chinese tech powerhouses, Shenzhen Proview Technology, over who owned the rights to the ‘iPad’ name – Apple’s rights on the brand name do not carry over to China – posed a challenge for the Communist government in China, which wants to support struggling Chinese firms such as Shenzhen but is also aware of the need for outside investment by the world’s major technology companies.
China is currently Apple’s second-largest market after the United States and has been selling mobile phones such as the iPhone 4S at a phenomenal rate. They will also be hoping that the imminent release of the iPhone 5 will perform well across Asia.
The court was shown a slim line box holding a thin computer, which the ailing Chinese tech manufacturer insisted was their ‘iPad’ or, as they quickly added, their ‘Internet Personal Access Device’.
Apple Inc. says it purchased the global rights to the iPad name from Proview back in 2009 but Chinese authorities say the rights in China were never transferred. A Chinese court ruled in December that Proview still owned the name in that country. Proview even asked the powers that be in China to seize and confiscate iPads, presumably until Apple felt the need to throw some cash at the stricken company.
"The iPad dispute resolution is ended," the Guangdong High People's Court said in a statement. "Apple Inc. has transferred $60m to the account of the Guangdong High Court as requested in the mediation letter."
"It is a good deal for Apple, because sales of iPads, which are in great demand, can compensate for this $60m cost," said You Yunting, a lawyer for the DeBund Law Office in Shanghai. Apple has yet to announce a China release date for the iPad 3 but the country's telecommunications equipment certification agency approved the tablet in May.