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Tech giant, Apple Inc, has just lost the rights to the ‘iPad’ trademark in China, simply because a Chinese Company Proview Technology , has registered the name iPad before the almighty Apple.
China operates a “first to file” system for trademark rights.
“This means first come, first served,” and a number of countries including Brazil, Indonesia, etc., operate a similar “first to file” system.
This means that your previous rights elsewhere do not matter. It’s simply a case of the first person or organisation to register a trademark in China owns it. In Australia, a company that can demonstrate prior or honest concurrent use of a name has rights to a trademark, even if it is not registered. This is not the case in “first to file” countries.
Apple’s downfall should be an important lesson to all Australian companies wanting to send their products overseas. You must protect your intellectual property before you export your products, not only to China, but anywhere.
The tech giant now faces a massive compensation lawsuit and a significant roadblock in sales of the popular iPad in China, but Apple’s biggest loss is on its reputation. Just imagine if the Chinese company that now owns the iPad trade mark starts developing tablets with poor quality components. This could have a massive impact on Apple’s reputation in China.
We have had a number of clients over the years that were not able to register their trade mark in China for this very same reason and we had to help them buy the trade mark rights from the Chinese registered owners. Unfortunately the costs involved are quite often unreasonable.
Now, Apple may have to retail its best-selling tablet computer under a different name in China or pay up to US$1.6 billion as the Chinese company is seeking 10 billion Yuan in compensation for Apple’s infringement of its trademark.
International Trademark law can be more complex than in Australia and companies planning to trade abroad using their brand names should seek specialist advice first.
As always, if you have any questions whatsoever regarding your intellectual property, please do not hesitate to contact your IP Wealth Account Manager or our team on 1800 857070
Our Office Closure for the holiday season is between 23 December 2011 to 9 January 2012 and the IP Wealth team wishes all our clients and friends a Seasons Greetings, and look forward to being of service in the New Year.