This is certainly interesting, although I think that there is more going on here than what made it into the news.

From Computerworld:

A Chinese company that owns the trademark “i-phone” has said it is not in talks with Apple, even though Apple may need the company’s blessing to sell its similarly named iPhone in China.

I don’t think I’ve ever heard a company admit that they were in negotiations with a counterpart on any issue, from mergers to litigation. Must be some sort of rule in corporate communications. Admit to nothing — they must have picked this up from the CIA.

Apple is in negotiations with carrier China Unicom to offer the iPhone, and in April it said it hoped to start sales in China in the next year.

But Hanwang Technology, a maker of devices and Chinese handwriting recognition systems, owns the trademark “i-phone” for mobile phones in China. The iPhone’s similar name would make it illegal to sell in China, said Wang Hao, general manager of BSFD, an intellectual property law agency in Beijing.

Not to rain on the parade of this Mr. Wang (kudos for getting your name in the article), but did they really need to ask an expert if the use of someone else’s registered trademark was legal or not? You don’t exactly need to be an IP guru to figure that one out.

Apple applied to register the iPhone trademark in China in late 2002, but its application only covered computer hardware and software, not mobile phones, according to the Web site of China’s trademark office.

Two years later Hanwang, also known as Hanvon, applied to register the i-phone trademark in the category covering phone equipment including mobile handsets. The company went on to sell a handset called i-phone, a Hanwang spokeswoman said.

OK, I have no direct info on this, but let’s think a bit. If Hanwang applied in late 2004, the mark was probably published in maybe 2007 or even last year. If I were Apple (or Apple’s IP counsel), I would have an ongoing search ordered for the mark “i-Phone” in China, in addition to a lot of other jurisdictions.

Assuming this is all true, then the Hanwang mark would have popped up on Apple’s trademark watch in 07/08.  Without an “iPhone” registration in China, an opposition would have been pretty tough (arguing well-known trademark protection), although if Hanwang owns the mark now and Apple did not even try opposing, this is a bit surprising considering the financial stakes.

To sell the iPhone in China, Apple would need to reach an agreement with Hanwang or apply for the trademark office to revoke Hanwang’s trademark, said Wang. Revoking a trademark usually takes three to four years and is a process unlikely to succeed, Wang said.

Cancellation would be based on bad faith, one would assume. In other words, Hanwang registered the mark knowing that Apple was already using the mark on mobile phones (when did Apple begin selling the iPhone, anyway?). Tough to win that case without some solid direct evidence. Also, the three (or more) year time horizon for a cancellation case will not work for Apple’s China iPhone plans.

Hanwang has not been contacted by Apple about the issue, the Hanwang spokeswoman said. It also has not received notification from China’s trademark office of any action by the U.S. company, she said.

She declined to comment when asked what Hanwang would do if Apple announced plans to sell the iPhone in China.

An Apple spokeswoman declined to comment.

Again, remember that Apple knew/should have known back in 07/08 about all this when the mark was published. Whatever strategy they decided on was put into place back then. If they figured on negotiating a purchase, then of course both sides are probably talking out of their asses about no communications.

As usual for these sorts of cases, what gets out to the press is about 5% of the whole story. As we get closer to a sell date for the China iPhone, more will be revealed.