Apple bs. Proview

Apple Inc. (NASDAQ:AAPL) heard some good news today as a lawsuit filed against it was dismissed in the United States. The lawsuit was filed by Proview International Holdings Limited (HKG:0334) and concerned the iPad trademark the firm used ffor its tablet computer. Proview had contended that the method Apple used to buy the iPad name was improper and fraudulent.

In China the lawsuit continues. The US dismissal of the case should speed things along in that procedure. Proview is being encouraged to settle the case which is being heard in Guangdong province. That case has posed problems for Apple’s growth in China. It’s new iPad product has not yet seen a release date announced in China due to the legal process there.

Apple bought the trademark in 2009. The firm according to Proview used a subsidiary called IP Application Development Ltd. to by the trademark. The company said the name was being bought because it was an acronym for the company. Proview alledges that this was an improper purchase of the rights under false pretences.

Another argument being fielded by the company is attempting to declare the original contract void. The company has said that the original signing of the contract was not attended by representatives of its subsidiary Shenzhen which actually owns the trademark.

Apple Inc has held throughout the legal process that it acquired the worldwide rights for the name. Apple has accused the Chinese firm of breaking the contract that they agreed on.

Today’s announcement of dismissal in the United States will be a boon to Apple’s prospects as it seeks to end the conflict. The company is learning that long drawn out patent battles are bad for business. That has been made clear in their recent attitude to its lawsuit with Samsung. The firm is beginning to learn that it can compete on features alone, not needing the extra strategy offered by legal hevyweighting.

Apple needs China to grow its business. The sooner they are allowed to sell their latest product in the country the better. A swift settlement, even if mainly on Proview’s terms, would net the company a huge amount of money as that iPad revenue starts rolling in and the ecosystem effect takes hold.

Proview earned $55,000 from the original sale of the iPad. If the court case is continued, and lasts as long as they appear to want it to last, the company risks losing much more in the long run. This case is not just bad for Apple. It’s bad for Proview.