Could signal escalation in Apple vs. Proview

Officials in the Chinese city of Shijiazhuang raided an unnamed Apple reseller over the weekend, reports claim. In all 45 iPad 2s are said to have been confiscated; despite the limited scope of the raid, Chinese news sources indicate that a number of other vendors have decided to hide their iPad stock rather than risk losing it. Shoppers should nevertheless still be able to buy iPad 2s from official and unofficial sources in the city.

The raid is connected to a trademark dispute brought against Apple by Proview Shenzhen. The latter is seeking up to $1.6 billion in damages, arguing that while Apple bought an iPad trademark from Proview Electronics in 2006, the purchase didn't include the Chinese rights belonging to Proview Shenzhen. A Beijing IP and IT lawyer, Stan Abrams, contends that Proview has a strong case, and suggests that cities beyond Shijiazhuang may act on their own.

"Proview has apparently filed an enforcement application with the Beijing Administration of Industry and Commerce (AIC) [and has] a pending appeal to the High Court on a Shenzhen contract-based lawsuit that Proview won at the lower level, and a trademark infringement case that Proview filed in Shanghai," he says. "Since Proview is the legal owner of the iPad trademark in China and, as far as we know, Apple has no good evidence that Proview filed the trademark in bad faith over a decade ago, it certainly looks good for Proview in both cases, particularly the one in Shanghai.

"Local AICs [as federal outfits] have the authority to handle intellectual property infringement cases that involve trademark and unfair competition. In the case of the iPad dispute, we are dealing with trademark infringement.

"What can the AIC do? It can raid premises, seize documents, equipment, products and counterfeit marks, and it can halt activity and lock down businesses. Once AIC makes a decision about infringement, it can order fines (these go to the government, not the trademark owner), revoke business licenses, and mandate a public apology."

By Electronista Staff