Proview accuses Apple of fraud, unfair competition

A man walks past an iPad 2 advertisement in Shanghai February 21, 2012. Apple has been accused of fraud by Proview, the company that used to hold several “iPad” trademarks. (ALY SONG/REUTERS)

Proview, the Chinese company that is suing Apple to stop sales of the iPad in China, has updated its case against the Cupertino, Calif.-based company in the United States, amending its lawsuit to directly accuse the electronics giant of fraud and unfair competition.

According to Proview, Apple misrepresented itself in seeking to secure the “iPad” trademark, buying the trademark from Proview in 2009 through a company Apple created called IP Application Development Ltd., or IPAD.

According to the filing, Apple bought Proview’s trademarks for the European Union, China, South Korea, Mexico, Sinagpore, Indonesia, Thailand and Vietnam as part of the agreement. Proview claims that the deal is invalid, saying that Apple misrepresented itself and its intentions for the trademark.

This is a slightly different issue than the one Proview is contesting in China, where the company says that the marks it sold don’t apply on the Chinese mainland. The Chinese case maintains there was no deal to transfer the mainland trademarks; the U.S. case seeks to invalidate any kind of deal between the two companies at all.

It’s fairly common for large companies to do business through smaller firms, particularly when looking to buy something that would tip off plans for future business moves. What appears to be at issue here is that Apple’s agent said the company wanted the iPad trademark because it was an abbreviation of its name.

“While some technology companies create special purpose vehicles in order to obtain trademarks, in this case the sole function of Apple’s special purpose vehicle was intentional misrepresentation, and an effort to fraudulently induce Proview Taiwan into a sale of the IPAD trademarks,” said Cal Kenney, a spokesman for the company, in a statement.

Apple did not deny any part of what was in the suit but referred to an earlier statement on the cases in China, saying, “We bought Proview’s worldwide rights to the iPad trademark in 10 different countries several years ago. Proview refuses to honor their agreement with Apple in China and a Hong Kong court has sided with Apple in this matter. Our case is still pending in mainland China.”

Related stories:

Proview files suit against Apple in U.S. court

iPad trademark dispute shows troubles of doing business in China

MWC 2012: Facebook’s mobile plan

Hayley Tsukayama covers consumer technology for The Washington Post.



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