China: Land of Apple Hunters 苹果在中国又吃官司

By newsdoug on July 9, 2012

Last week’s settlement of a high-profile trademark dispute that appeared to mark a victory for Apple (Nasdaq: AAPL) has apparently done little to discourage others from pursuing the US tech giant in court, with 2 new cases making the headlines just days after announcement of an end to the original dispute. My only possible explanation for the strange timing in the announcement of these new cases is that perhaps the 2 plaintiffs saw that Apple agreed to pay $60 million for rights to the iPad name in China to a bankrupt company named Proview, and now think that they can perhaps get similar settlements in their own cases.

If that’s what they think, they are going to be very disappointed since neither is likely to get any money from Apple in a settlement, and both could end up with big legal bills and little or no guarantee of a victory if they try to fight the world’s biggest tech company in a Chinese court.

Let’s take a look at the 2 new cases, the first of which is seeing a company named Jiangsu Xuebao suing Apple in another trademark case, saying it owns the China rights to the name Snow Leopard, which happens to be the new name for the operating system in Apple’s latest series of Macintosh computers. (English article)

I have to admit that I’m hardly an expert in Chinese trademark law, and it does indeed look like the name of the Chinese company in this case translates to “Snow Leopard”. But regardless of the situation, Apple might simply end this case by choosing a slightly different Chinese name for its new operating system, which wouldn’t cause big problems anyhow as it isn’t well known in China the way that iPad was.

Or if it believes it legally has the right to use the name, it will simply fight the case in court. Either way, if Xuebao was hoping to get any money out of Apple in the case, it probably has a better chance of squeezing water out of a stone.

In the second lawsuit, another company named Zhizhen Network Technology is claiming patent infringement, saying Apple is illegally using its voice recognition technology for the Siri function on its latest iPhones. (English article) Zhizhen filed its case back in May, and thus it predates the Proview settlement. Furthermore, a court has agreed to hear the case if the 2 sides don’t reach a settlement, meaning the judge feels that Zhizhen’s claims may be valid.

But again, I think that Zhizhen is going to find itself facing a difficult road and lots of legal bills if it really tries to pursue this case in court. For starters, I seriously doubt that a huge company like Apple would knowingly infringe on the patent of a small Chinese company for such a globally important product like the iPhone. Of course it’s still possible that Zhizhen’s technology is similar to the Siri technology that Apple may have patented in the US, and I’m certainly not an expert on how this kind of a case would be resolved.

But in the end, I think that Apple will fight both the Zhizhen and Snow Leopard cases even more fiercely than the Proview one, as it will want to send a clear message to the market that anyone who wants to try to squeeze money from it over legal claims might want to think twice before taking such actions. Accordingly, look for both cases to proceed to trial without any settlements, and perhaps for Zhizhen, Snow Leopard or both to quietly drop their cases after they decide it’s not worth it to fight Apple in court.

Bottom line: Apple will fiercely oppose 2 new lawsuits against it in China, and is highly unlikely to settle either case before trial.

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