Apple has agreed to pay $60 million to electronics company Proview in order to continue using the iPad name for its popular tablet computer in China.
The Associated Press reported that the Guangdong High People’s Court said the case had been settled and that Apple had transferred the money into the court’s account.
Proview, a struggling Chinese electronics company that held the “IPAD” trademark for a desktop computer, said that Apple had misrepresented itself when it originally sought to buy the name before the iPad tablet’s 2007 launch.
Apple had used a smaller firm to purchase the trademark from Proview’s Taiwanese affiliate — something that is standard practice in the industry. Proview said both that its Chinese branch should not be bound by its affiliate’s agreement and that it was not clear that the trademark would be used to brand an electronics product.
Apple, which said it had bought Proview’s worldwide rights to the iPad trademark in 10 countries, accused the Chinese company of not honoring its business agreements.
In December, a Chinese court said that Proview should not be bound by that sale.
The case, which led to some government officials pulling Apple’s tablets off the shelves in some Chinese cities this past February, highlighted the problems that American companies can face with Chinese trademark law. As The Washington Post reported in February, American firms often have trouble navigating how the Chinese government interprets and implements its copyright and trademark laws.
China is a critical market for Apple and other consumer technology companies, who not only make their devices there but also want to tap the country’s enormous market potential. Apple said in April that its iPhone sales on mainland China alone had increased five-fold in its last quarter.
Apple has yet to introduce its latest, third-generation tablet in China, the AP reported, though the resolution of this case should clear a hurdle to sales. The device has already been approved by the Chinese telecommunications agency.
Proview had also filed suit against Apple in the U.S., which alleges that Apple misrepresented itself and its intentions in order to obtain the trademark in the first place. The company could not immediately be reached to discuss how the new ruling affects that suit.