Apple in trouble over 'iPad' trademark

A court in southern China has rejected a claim by Apple Inc. that a Hong Kong-headquartered tech company has violated its iPad trademark, in the latest development in a case that could affect the U.S. company's financial prospects in the country.

Apple's Beijing-based spokeswoman Carolyn Wu declined to comment Thursday on the decision by the Municipal Intermediate People's Court in the southern city of Shenzhen.

The court said on its website that it dismissed a lawsuit Monday by Apple against Shenzhen Proview Technology over the ownership of the iPad trademark. The company is a subsidiary of LCD screen maker Proview International Holdings Ltd., headquartered in Hong Kong.

The court ruled that the Shenzhen company is not bound by a 2009 agreement that its Taiwanese affiliate, Proview Taipei, made with Apple to transfer the trademarks to the Cupertino, California-based company for 35,000 pounds ($54,700).

Proview in Taiwan had registered the trademark in various countries as early as 2000, while Proview in Shenzhen registered the trademark in China in 2001.

According to the Shenzhen court decision, Apple says its trademark transfer agreement with Proview'sTaiwanese company should also apply to the Shenzhen company, but the court rejected that, saying that the Shenzhen company was not involved in those negotiations.

Proview Shenzhen has been mired in financial problems and will seek to claim 10 billion yuan ($1.6 billion) in compensation from Apple for copyright infringement following the court ruling, the official Xinhua News Agency reported. The U.S. company has the right to appeal the verdict.