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Can You See Apple in a Tooth Fairy Tutu?
To pressure Apple to settle, the AP said that the Chinese government regards Proview as the rightful owner of the iPad trademark

The Guangdong High Court in southern China that heard Apple's appeal of a lower court decision awarding ownership of the iPad trademark in China to Proview Technology (Shenzhen), the financially desperate Chinese display maker that ostensibly sold Apple the trademark, is now reportedly trying to mediate a settlement between the two.

Despite claims to the contrary, it's unclear whether Apple is actually considering settling knowing full well it's expected to buy its way out of a predicament it believes it's on the right side of for some sky-high sum.

Apple won't say anything about it while Proview booster Ma Dongxiao, its chatty public-facing lawyer, claimed last week that "I don't know if Apple has changed its attitude, but I believe that the key point now is the price." (Yes, well then Apple's attitude would have to have changed now wouldn't it.)

Zhao Le, described as an official at the foreign affairs office of the Higher People's Court of Guangdong, told Bloomberg, "On the one hand, we are trying to process this case, and on the other, we are working on encouraging both sides to settle." (Operative word appears to be "encouraging." They could also be blowing on dead embers. Mediation talks are pro forma and voluntary in Chinese courts.)

To pressure Apple to settle, the AP said that Yan Xiaohong, the deputy director of the National Copyright Administration, told reporters in Beijing Tuesday that the government regards Proview as the rightful owner of the trademark. In the absence of a definitive decision yet from the appeals court, he seemed to say, "according to our government's laws, Shenzhen Proview is still the lawful representative and user of the trademark." The news conference was carried on the Internet.

It really looks like Apple is waiting for the court to make a ruling. That would put the onus back on the court to choose between what it might see as a political decision in favor of Apple and a dubious legal decision in favor of Proview considering Apple's pile of evidence in its favor. (See http://allthingsd.com/20120216/take-a-look-at-some-of-apples-evidence-in-proview-ipad-dispute/.)

Judging from media reports, the Seattle law firm of Harris & Moure PLLC, which has some experience of Chinese IP cases, says it looks like "Proview tricked Apple into believing that Apple had purchased the iPad name in China from Proview when, in fact, under Chinese law, Apple had not," not a view Apple has ever countenanced.

Harris & Moure also figures a decision for Proview "would not be a good thing for China."

It reckons "the world would freak out even more about China's IP protections and at least some foreign companies would cite this case to justify not going into China, not selling their product in China, not working with Chinese companies, and even not buying from China. None of this would be good for China."

Harris & Moure even imagines a decision for Proview might push Apple to move its iPad manufacturing or large parts of it out of China, not sell the iPad - and maybe even other Apple products - in China anymore, and never ever pay Proview one yuan for licensing rights because of the precedent it would set. (In part, at least, a very Googlesque view.)

"Note," it says, "that Apple has yet to release its newest iPad in China. How do you think the loss of iPad-related jobs will play among China's masses? How do you think the loss of the iPad at retail will play among China's elites? I am quite certain the Chinese government is thinking about these things."

Harris & Moure once had a "sticky" case in China. "Every China case we had before that sticky case either settled or was ruled on shockingly quickly," it recounts. "But our sticky case just languished. Six months at a time would go by with nothing. Then when our Chinese lawyers would ask the court what was happening on our case, the court would tell them that we needed to settle. The other side was being told the same thing. Between the lower court and the appellate court, this went on for more than three years. The courts eventually did rule, but of course our case had nowhere near the significance of the Apple-Proview one." (Its western client lost.)

Harris & Moure seems to think the only sane party in Apple-Proview mess is the Chinese government and says we should assume - like maybe we aren't? - that "the courts are taking their direction straight from Beijing's highest echelons" - and that those boys ain't about to let Apple and Proview "go off the cliff" wrapped in each other's arms.

So Harris & Moure figures what Beijing needs to do - and you do remember Tim Cook's recent visit with the next Chinese premier - is to "come up with a face-saving solution for Apple that will involve Apple maybe indirectly paying off Proview while receiving some sort of major bone from the Chinese government. Something that will give Proview money and yet still allow Apple to claim an overall victory."

One might call that a "Tooth Fairy" resolution to what ails Proview, which owes money to every big bank in China. Can't you just see Proview waking up one morning and finding a pile of loot under its pillow?

Somehow Apple just doesn't seem cut out for a Tooth Fairy tutu.

About Maureen O'Gara
Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

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