iPad Trademark Settlement: I’m Beginning to Hate ‘The Big Picture’

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Since yesterday’s announcement of the settlement agreement between Apple and Proview regarding the iPad trademark in China, I have limited myself to one post. I thought it was all that was needed, and as straightforward and brief as is possible from a lawyer who, to paraphrase a famous philosopher, is not into the whole brevity thing.

I also talked to quite a few members of the media yesterday via phone, email, SMS, carrier pigeon, smoke signal, telegraph and raven. Pleasant conversations all, but adding up these encounters together, I must admit that I’ve had quite enough of the “What have we learned?” question, also known as the “What’s the big picture here?” or “What does this mean for other foreign companies in China?” or even “What does this say about IP protection in China?”

A variation of the “Big Picture” question was obligatory. I get that. And I felt bad answering with “there is no big picture here,” so I dug down for something clever to say, discussing the Chinese judicial system and mediation (here’s a good post by ChinaIPR on that topic, by the way), best legal practices for MNCs, etc.

But really, there is no big picture here. You simply can’t take a contract dispute that, despite touching on a couple of interesting technical legal issues, doesn’t really deal with any matters of interest to other foreign companies in China, particularly when it comes to IP protection.

And yet, I know that won’t stop some folks from the usual “what does this mean?” discussions. So far, I’ve only had one Q&A, about trademark valuation, that piqued my interest. The question was whether the Apple settlement figure of $60 million will drive up the sales price of trademarks in China and perhaps even embolden squatters.

My answer: unfortunately yes. Even though Proview was never a squatter, they are being portrayed that way by some out there, and other squatters might look at them and say, “Hey, they got paid. Why not me?” The logic is flawed, but no one said IP infringers are the sharpest knives in the drawer. This case received a great deal of attention, and the amount of money involved was huge.

Then there are the irrelevant issues or even fantastical ones. The San Jose Mercury News ran an article today entitled: “Apple’s trademark settlement in China signals a possible increase in lawsuits.” Intriguing, I thought. How on earth could a contract dispute case like this herald a new age in litigation?

A little-known bankrupt Chinese technology company that attempted to hold Apple (AAPL) hostage in a dispute over the iPad trademark has settled for $60 million — far less than it had originally demanded — handing the Cupertino company a victory but also signaling increasing legal conflicts in the world’s second-largest economy, experts say.

Right. So they have some experts who will explain. And what did they say?

An extraordinary uptick in the rate of new patents in China indicates that more technology companies are apt to face legal challenges in that country, said Matthew Schruers, senior counsel for the Computer & Communications Industry Association in Washington, D.C.

“One could anticipate there will be a sort of litigation food fight down the road, just as we see here in the United States with the smartphone wars,” he said.

I see. So the Apple case, a contract dispute over the ownership of a trademark, is somehow related to an increase in patent filings? Hmm. Maybe you have to be drunk to understand the tortured logic here. I’ll go get a beer and give it another try.

{glug, glug, belch}

No, that didn’t help. (Didn’t hurt, though.) I read through the rest of the article. Nothing really there as to why this case will result in more China litigation for foreign companies. But the headline did get my attention, so mission accomplished.

This was just one example of dubious “Big Picture” claims. Many of these worry the hell out of me, not only because they make no sense, but because some of the more ridiculous statements embedded in these articles will no doubt hang around in our collective subconscious. From the beginning, I was worried about the legacy of this case. When we think back one, three, or ten years later, what will we remember? I already saw one article where the author states that Apple lost the case! Many others simply summarize this as a trademark squatting incident, or some sort of IP extortion. It’s like Coca-Cola/Huiyuan all over again.

Resist the urge, folks. I’ve gotten a lot of play from this case and would love to see it live on in perpetuity. While it was ongoing, the case had huge business ramifications. That’s over now, and iPads will be flying off the shelves here in no time. But from a legal point of view, it just wasn’t all that important, and there are few lessons that can be drawn from it. Let it rest in peace, and we can move on to the next fun topic.

3 responses on “iPad Trademark Settlement: I’m Beginning to Hate ‘The Big Picture’

  1. KS Chin

    Cyber Squating is a time honored tradition on the Internet. Everyone is doing it including the domain name search companies. Don’t believe me? Do a domain name search and repeat it a few times and lo and behold, soon that domain name has bee bought. The payoffs are big. Only this time, it is a big brand name Apple who got caught in it and Proview was a bit greedy.