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Wednesday, October 27, 2010, 07:00 pm PT (10:00 pm ET)

Taiwanese company threatens to sue Apple over iPad name

A struggling Taiwanese company is threatening to sue Apple for $1.5 billion over the iPad trademark, claiming an earlier agreement to sell the "global trademark" didn't include trademark rights for the Chinese market.

Proview, a Taiwanese contract manufacturer of flat screens, says that it kept its rights to the iPad trademark in China, although it sold the "global trademark" to Apple in 2006, according to the Financial Times. Several years ago, Proview tried unsuccessfully to market an I-Pad tablet computer, but has since abandoned the project.

Chinese news site Caixin reports that the company is asking for CNY10 billion (over $1.5 billion) from Apple.

“We will sue them for damages in China and in the US,” said Proview chairman Yang Rongshan.
According to the report, trademark databases show that, between 2000 and 2004, Proview registered the iPad trademark in "the EU, China, Mexico, South Korea, Singapore, Indonesia, Thailand and Vietnam." Apple purchased the U.S. iPad trademark from Fujitsu in March.

Yang says Proview Electronics (Taiwan) agreed in 2006 to sell the iPad trademark to a company called IP Application Development for $55,000, without realizing that the company was connected to Apple.

Yang asserts that the 2006 deal did not include Chinese rights to the trademark owned by Proview Technology (Shenzhen), an affiliate of Proview International, which is listed in Hong Kong.

“It is arrogant of Apple to just ignore our rights and go ahead selling the iPad in this market, and we will oppose that,” said Yang. “Besides that, we are in big financial trouble and the trademarks are a valuable asset that could help us sort out part of that trouble.”

For Proview Technology (Shenzhen), "big financial trouble" means defaulting on loans worth $400 million and having assets seized by a group of Chinese creditor banks.

Apple contends that the 2006 agreement should include the Chinese trademark rights and has succeeded in winning preliminary injunctions blocking Proview from selling off the iPad name, though the cases are currently pending, the report noted. According to the Financial Times, Proview is still registered as owning two iPad trademarks registered in China.

An iPad trademark dispute could complicate Apple's efforts to expand in China. The iPad officially launched in China on Sept. 17, with hundreds of buyers lining up outside Apple's retail stores. On Tuesday, Apple unveiled a Chinese Online Store with free shipping and an Chinese-language App Store that will add value to sales of the iPad, iPhone, and iPod in China.