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The iPad may be one of Apple's most important products. The dominant tablet device has been selling at an impressive rate, and that only looks to continue when Apple releases the iPad 3, something that could happen as early as March.
But there's just one problem: according to a Chinese firm, Apple doesn't own the 'iPad' trademark.
Proview Technology claims it's the owner of the mark in China and other key Asian markets. And it appears to be serious about defending its rights. Li Su, the chairman of the company responsible for restructuring Proview Technology, says "Right now we are selecting from three American law firms to sue Apple in the United States for $2 billion in compensation."
What isn't in doubt is that Proview Technology did hold the 'iPad' trademark in China and other countries well before Apple started working on its tablet device. But Apple contends that it struck a licensing agreement that addressed the matter. Apple has documents showing that the rights to the trademarks in question were sold to a UK company, IP Applications, which then sold them to Apple in 2010.
Proview Technology, however, claims that those documents don't mean much because the deal with IP Applications was made by its Taiwanese subsidiary, not the company's Shenzhen parent.
One thing is for sure: this is a mess and it probably isn't going to be resolved overnight, putting Apple in a precarious situation in a market that is increasingly one of its most important. The good news for Apple is that it's no stranger to litigation, even if it prefers to play the role of plaintiff.