iPad, youPad, wePad? Who Is the Owner of the Trademark in China?

iPads for sale in the Apple Store at Central, Hong Kong
 Photo Danny Friedmann

Apple introduced a third category, in between a laptop and smartphone, on January 27, 2010 (see the late Steve Jobs give the presentation here and demonstration here and here). April 3, 2010 it was intoduced in the U.S. and one month later in other places around the world. Two months later already a million of these devices were sold. And according to Reuters, Apple has sold 15.43 million iPads in the last 14 weeks of 2011.

So Jobs vision became reality. But how to name this third category? 

" ... and we call it the iPad." 

That other companies had already registered the name iPad in some jurisdictions could be solved, so the thinking went. For this purpose Apple set up a special purpose company to acquire these trademarks in all relevant jurisdictions. The name of the company IP Application Development Limited is interesting, because abbreviated it is IPAD Ltd. 

In the acquisition process, or rather effort to assign the trademark, a mistake was made. IPAD Ltd. and Proview Holdings, Proview Electronics (Taiwan) and Proview Technology (Shenzhen) entered into a written agreement, December 2009, whereby they agreed to sell, transfer and assign the Chinese trademark of iPad to IPAD Ltd. for £35,000. However, in the written agreement Proview Electronics (Taiwan) pretended to be the proprietor of the trademark and "assigned" the trademark to IPAD Ltd. But the real proprietor was Proview Technology (Shenzhen). John Paczkowski seems to have gathered some of the documents, see here. Then Proview Technology (Shenzhen) started to try to enjoin the sale of iPads in China for alleged infringement of their iPad trademark, and was successful in cities such as Shijiazhuang and Huizhou, according to David Levine in an article for Reuters. Or, if Apple wanted to avoid getting banned from the Chinese shops and gain control over the iPad trademark, they had to pay 10,000 U.S dollar. 

Also it became clear that Proview Technology (Shenzhen) had lodged applications with the Trademark Office, part of the State Administration for Industry and Commmerce, to transfer the Chinese iPad trademarks to Yoke Technology on May 7, 2010. 

The mistake by IPAD Ltd/Apple could have been easily prevented. If you go to Trademark Search of China's Trademark Office, part of State Administration for Industry and Commerce, and type in IPAD in class international trademark 9, you will see that Proview Technology (Shenzhen) registered the trademark January 10, 2000, see registration number 1590557 and that the effective period of exclusive right: June 21, 2011-June 20, 2021, however, it seems to be repealed because of non-use for three years). Also Proview Technology (Shenzhen) has registered the stylized version of the trademark, international trademark class 9, under registration number 1682310, application date September 19, 2000. Effective period of exclusive right: December 14, 2001- December 13, 2011. Continued after objection. So at least IPAD Ltd could have easily found a starting point to trace who owns the iPad trademark for international trademark class 9. 

Everybody knows Apple these days, but Proview used to be famous too. Proview Group is a producer of display devices, which  include LCD monitors, CRT monitors and flat-panel digital products. It has operations and offices around the world, including Taiwan, Mainland China (Shenzhen and Wuhan), Hong Kong and Europe. Proview Holdings was incorporated in Bermuda and is listed on the Hong Kong Stock Exchange. Proview International Holdings Ltd was the first Taiwanese technology company to list in Hong Kong, and was quite successful. In 1999 it teamed up with U.S. chip maker National Semiconductor "to launch the I-PAD, a stripped-down desktop computer whose main selling points were its Internet connectivity and ease of use." Then Proview was hit by the financial crisis and May 12, 2010, the Hong Kong Stock Exchange issued a notice that trading of Proview Holdings’ shares had been suspended. Read here Jeremy Wagstaff and Lee Chyen Yee's Reuters article on Proview's rise and demise, see here.

Timeline

May 20, 2011, Apple Inc. and IPAD Ltd filed a lawsuit in Hong Kong against Proview International Holding Ltd, Proview Electronics Co (Taiwan) Ltd, Proview Technology (Shenzhen), Yang Rong-Shan (founder of the Proview Group and  chairman and CEO of Proview Holdings who was adjudicated bankrupt on August 2, 2010) and Yoke Technology (Shenzhen). The Hong Kong case reveals many of the relevant facts: High Court Of The Hong Kong Special Administrative Region Court Of First Instance, Action no. 739 of 2010  (HCA739/2010). On June 28, 2011 the Poon J. (潘兆初法官), decided and July 14, 2011 he motivated his decision to allow  the interlocutory injunction and restrain the defendants to "sell, transfer, assign, otherwise dispose of and/or give good title" to the Chinese iPad trademarks. 

May 24, 2010, Apple instituted proceedings against Proview Technology (Shenzhen) in the Shenzhen Intermediate People’s Court and filed an application for Asset Preservation Order (APO) in respect of the Chinese iPad trademarks. June 12, 2010 the application was granted on 12 June 2010, subject to the APOs obtained by some other Mainland banks.

Proview Technology (Shenzhen) has started suing Apple resellers at the Shenzhen Futian District Court (December 30, 2011) and Huizhou Intermediate People's Court (January 7, 2012), read Katrin Hille's FT article here and about Apple losing there here, at Stan Abram's China Hearsay.

According to Shenzhen Media People’s Court Apple lost its trademark ownership on December 6, 2011, see Huang Mengren's article here. Apple decided to appeal at the Guangdong Higher People's Court.
February 22, 2012, there was a trademark infringement case between Proview and Apple at the Shanghai  Pudong New Area People's Court. Apple was successful to the extent that Apple's iPads were not banned from the shelves. But as Stan Abrams of China Hearsay made clear, see here and here, the real question is who owns the iPad trademark. This will be decided at the Guangdong Higher People's Court, February 29, 2012.

In the mean time Proview Electronics (Taiwan) has accused Apple of fraud in a lawsuit filed at the Superior Court of California, County of Santa Clara. See here. However, in contrast to trademark lawyer Martin Schwimmer of The Trademark Blog, who was quoted by David Levine responding to the case: "I have never encountered this level of ruse", see here: I think it is not so strange nor unusual if you set up a special purpose company for the acquisition of a name such as iPad. Especially since iPhone is so ubiquitously known that if Apple pursued the trademark iPad, it would have definitely driven up the price, as this case proofs: from 35,000 pounds to 10 million U.S. dollars. There is no legal requirement to disclose the reason why you want to buy a trademark. Or is there?

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Smartphone Patent War 2012: Chinese Alliance vs International Brands

The battlefield of patents are more and more the place where competitors are vying for market share. China has become the world's largest market for smart phones in the third quarter of 2011, according to Strategy Analytics. Some Chinese smartphone makers, including Lenovo, ZTE, TCL, Coolpad and Konka joined forces to protect themselves against the rising number of claims of patent infringement by international smartphone manufacturers, such as Apple, Nokia and Microsoft, and to dominate China's domestic market.
Huawei has around 65,000 patents and also ZTE has a substantial number of patents for wireless communication technologies. According to Erica Yen and Steve Shen of Digitimes many Chinese smart phone makers develop localized interfaces and even operation systems, see here.

Chinese smartphone manufacturers also launch their products via China-based telecom carriers and social networking websites operators, via dual branding. HTC and Sony Ericsson grew rapidly because their Android models were popular in major cities of east and south China, according to Linda Sui of Strategy Analytics. If China Telecom will launch the CDMA iPhone 4S early next year, Ms Sui expects Apple's market share to peak. Globally Nokia is still number one, closely followed by Samsung and Apple.

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Will the iPad Trademark Be Apple's Forbidden Fruit?

Must Apple resellers in Dongmen, Shenzhen stop selling iPads?
Photo: Danny Friedmann

Kathrin Hille wrote for the Financial Times (FT) that (mother company) Proview Electronics of Taiwan agreed to sell Apple the “global trademark” for the iPad name for 35,000 UK pounds, according to Proview. "[B]ut the two companies have subsequently disagreed about whether that deal included China", read Ms Hill's FT article here.

Of course there is no such thing as a global trademark, that is why Ms Hill put it between quotation marks. Trademarks are rather territorial creatures. It is beyond my imagination that the lawyers of Apple did not check whether the trademarks for the iPad in China were included. If I would buy something for 35,000 UK pounds, I would check and double check.

When Apple applied for the iPad trademark in China, it was rejected by the trademark office, because Proview Technology already owned the trademark. And Apple sought a declaration of invalidity at the Shenzhen Intermediate People’s Court. The FT reports that the court rejected this request by Apple earlier this week. Apple can, and I am certain, they will appeal.

In the short term Apple has more problems, now that Proview Technology (Shenzhen) has started suing Apple resellers at the Shenzhen Futian District Court (December 30, 2011) and Huizhou Intermediate People's Court (January 7, 2012). 

Guangdong Guanghe land Grandall were the law firms that assisted Proview.

UPDATE: More about ongoing trademark battles between Proview versus Apple here.

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Independent Creation Valid Defense Against Copyright Infringement

Jonathan Mak, design student at Hong Kong Polytechnic University School of Design said that he did not rip-off the idea for the Apple tribute in which you can distinguish the silhouette of the late Apple co-founder Steve Jobs.

Invisible Gold in Asia Facebook Page (set up by author of the book with the same name Professor David Llewelyn) explains that both parties (or theoretically even more parties) can come up with the same copyrighted work: "Although that will be harder to prove so make sure you keep records."

If you can prove that you created the work independently, you can use it as a valid defense against copyright infringement.

See Jonathan Mak's design here.

The design of UK designer known as Raid71 here.

In this YouTube video the voice-over says that Jonathan Mak "has been offered copyright offers". Well, if Mak is the creator he automatically has the copyright of the work, at the moment of creation. What the voice-over probably means is that he got offers to assign his copyright. 

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Steve Jobs on Creativity: Be Bored, Become Curious and Change The World

Steve Jobs, visionary leader of Apple has passed away. His legacy is enormous. Whole new product categories, new way to think about consumer products and processes. There is also a lot one can learn from his words of wisdom. In Steven Levy's excellent effort to condense such an incredible full live into one article he quotes Jobs saying:

"I’m a big believer in boredom. Boredom allows one to indulge in curiosity. Out of curiosity comes everything.” 

We can take this all at heart. Especially in Asia there are lessons to be learned, where the main culture is focused on using up every moment in a "useful" way. Most youth study at home or at cram school until bedtime. Basically there is no free time. Doing nothing and playing are essential ingredients to get the creative process going.  

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Lessons From WikiLeaks About Apple's Intellectual Property Enforcement in China

Mark Milan of CNN has read the Wikileaks cable from the U.S. Beijing embassy on Apple, read here, see original text here.

WikiLeaks cored Apple in China

The Wikileaks suggest that Apple, in regard to the enforcement of intellectual property in China dealt with the following challenges:

• It seems that Apple realised there was a serious problem quite late and only in 2008 it formed a security team, experienced in the protection of Pfizer, that took action; Lesson: assess the markets, have a budget and a team to enforce ready before you do business.
• Like many companies it does not want to start high profile raids; Lesson: It can be an effective deterrent to potential counterfeiters if you are known as an aggressive enforcer. 
• Like many companies enforcing their intellectual property rights in China, Apple experienced that its product categories are no priority for Beijing (unlike medicines); Lesson: it takes time, effort and money to lobby via U.S. government or EU politicians with Beijing for your particular industry to be noticed. 
• Apple like many other companies tried to scare consumers away from buying counterfeit products (don't know whether batteries really blew up. Then again I personally have come across phony phones with high level of radiation that gives you a headache after a mere two minutes if your skull is less than 1 inch thick); Lesson: transparency about health and safety issues can work. 
• That it can be hard to close down factories which manufacture infringing goods, because this could lead to unemployment, which on its turn could have a negative influence on the local economy, which increases the possibility of social instability. Typical example of local protectionism; Lesson: become part of local communities and economies to really have some influence. Choose your battles wisely: do forum shopping to sue infringers in those courts that you trust.  
• That to close down shops in malls can be difficult because the authorities do not want to disturb the shopping in the mall. Another example of local protectionism (sometimes called localism). Lesson: be innovative. Use for example contractual solutions, such as the landlord liability schemes.

UPDATE August 31, 2011:

Philip Elmer-DeWitt published for Forbes the full text of the U.S. Beijing embassy cable here.

UPDATE September 1, 2011:
Chenfei Zhang of Newsy, pointed me to their "multisource video news analysis" about the subject. Thanks Chenfei.

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Guest Column: Eddie Tao's Reflections on Working for Apple, Steve Jobs, Inspiration, Innovation and Intellectual Property

Eddie Tao: "Co-design is not
how Apple likes to work."

Dear readers of IP Dragon,

IP Dragon (aka Danny), a long time friend of mine asked me to consider writing some notes about the latest news about Apple's CEO, Steve Jobs. Danny and I met at Chinese school in Amsterdam, NL. While Danny worked his way through the Cantonese curriculum and was very interested to get the right pronunciation in Cantonese. So, we met a few times where I gave him some advice on pronunciation. I'm an ex-Apple employee (outside of my control) and an Apple fan (since 1990). So reality distortion factor affects me a lot. I used to work there as quality engineer, and currently work for HP's IPG division in a similar job. I'm not used to write blogs; so, be prepared for tangents and incoherent notes.

Today, 25 August 2011, I found out that Steve Jobs announced his resignation as CEO and wishes to continue as Director and Apple employee. And that Tim Cook will succeed him. Having worked for Apple for almost a decade, and being an Apple fan, the news was shocking, despite this is one of the possible scenarios based on the info about his condition. Many mixed feelings and questions popped up: is Apple going to make it, is Steve doing OK, how will this affect the Apple shareholders, feelings of sadness (as if one loses a beloved one), and what's Tim going to be like, to name a few.

Like myself, many others show concern about whether Apple is able to continue to be as successful and innovative without Steve as CEO/leader. When I checked the stock market today, the Apple stock traded on the Frankfurt exchange dropped about 4.5% in the early trade (-1.75% on NASDAQ at 10.45 PST), and then slowly climbed up to -2%. Related partner companies such as Foxconn/Hon Hai traded almost 5 to 10% lower after the news. As many know already, Foxconn is a large and important Apple partner for product manufacturing such as laptops, desktop PCs and hand held devices. Unlike HP and other PC manufacturers, Apple retains the control over the design and only requires Foxconn and other partners to manufacture their design without further input. Co-design is not how Apple likes to work. (Note: "Designed by Apple in California" and "Assembled in XXX", where XXX is the country of assembly, is found on the Apple label). It is interesting to see how outsourced partners are affected when you look at their stock value. In a way I'm amazed how big Apple's influence/importance is to us. Apple clearly has a plan and executing it step by step - though Apple doesn't like to share its strategy. Steve has shown several glimpses about how he views Apple and about changing the world to provide a better experience. There are numerous examples of his quotes and statements available, which he made in the last three decades.

Back then, when I was part of the Apple family, listening to the keynotes (internal or external) they boosted the connection with the company and Steve. There was this sense of being there together to create an excellent customer experience. Steve would highlight how the products and solutions would market itself through their design and functionality and how they would help the customer do things simpler and easier. (Various books, observations and opinions about this passion for simplicity for the user are available.) At the end of those sessions one would feel amazed and energised to put in an extra few kilometers (or miles) to make it happen. Time spent for Apple is not an issue at all - there are many examples out there - and it was no exception for me to put in 60 (reality) to 80 (ego) hours. One could say, it's the love for the company, the product designs and its charismatic leader that made it worthwhile. To reach the end goal that Steve has envisioned is what matters. I perceived my tasks as to support the magic of Apple and to help change the world a bit. That is unbelievably energising. The feeling that the effort that's put in really matters. (Maybe my ego speaks now.) In my role as Supplier Quality Engineer I was to work with fellow SQEs all over the globe to ensure the products reach the required quality levels that the Apple customer deserves. Few simple examples (but statistically unsound, if I am honest) would be: my Mac Portable still hums happily, as does my PowerBook G3 of 1999, next to the newer iMac 27" of 2008. (I cannot reveal failure rates, but they are impressive in a positive sense.) I dealt with the outsourcing and service partners and basically my job was to remind them what quality levels Apple is expecting, and worked with several: Foxconn, Inventec, Samsung and LG, to name a few. Great people and teams to work with - many of those I encountered with became my friends. Most of them were half a world away from me. But despite the distance we understood our mission - it was to help make happen Steve's vision, his dream as I perceived it. Again, it's this magic that we understood without saying a word. We could read it by looking in each other's eyes. With other employers, there's passion to make things happen, but not as strong as Apple - at least very different.

When it comes to IP (Intellectual Property), Danny's expertise, I can only say that Apple is very sensitive to that. Apple has guarded IP and related info as important to maintain the (competitive) edge. I myself value knowledge and creativity a lot. I remember one or more occasions where my manager informed me that he's been asked to justify why I had been accessing unreleased product information. Consider this similar to a situation where a security breach has been discovered. However, in my role as SQE, getting prepared for a product launch, it is handy to know the info about service parts used in that product, and getting suppliers ready to service them on time so any customer who have an issue with the new product can be supported/helped. The info is needed to set up the reverse logistics supply chain. It's a relative boring and hidden supply chain (of broken products - with negative vibes), but very important in my opinion. Boring as: not so sexy as the Finished Goods (= what consumers buy) supply chain. As the FG is considered making the revenue and thus more important. In my opinion, reverse logistics is even cooler to work with. As there are numbers out there that 1:9 will voice their issue and the rest remain silent. That one customer is able to get a nice service experience and tell like 9 to 11 others about the good service they've gotten from the company. So in my perception, I liked it a lot to get feedback about broken parts/products. To me, it's another way to "talk" to the customer to show what's the value-add of our Service team. Those were customers who think it is valuable to provide feedback, so they can help improve the product. I think if you can show good service to the customer, it's going to change the perception a lot, and customers become more loyal (and hopefully purchase again). Through my job, I was able to "talk" to my customer. And that, in a sense, was carrying out the passion for the customer. To make the customer experience, as Steve envisioned, as nice as possible. I as a nerdy perfectionist, I loved this attitude that drives perfectionism. I'd rather say, it's knowing what is needed to reach customer satisfaction. Others would call it perfectionism of Steve and the team. Maybe because they do not know how to respond otherwise, and use perfectionism with a negative connotation.

Being so passionate about a company such as Apple and its products, makes it hard to have an objective view. I've worked for various companies, but cannot say I've had the same passion before for a company like Apple. It's like working for a team and you know that their mission is the ONE. It's good on the scale of good and evil. It's going to make a change - a change what appears to be for the better. I think all of us have been to a situation while making a decision helps us feel great about it because it's 100% the right one. No doubt about it, not even the devil's advocate can make a difference. Steve's reality distortion force is strong - very strong. He's without question nor doubt, very good at it. And I think it's his level of thinking that makes him put these concepts into the words that he's using. (Note the various quotes from him that are out there). As if from a different dimension. Think of a 3D world. How do you explain in words in such a way that a 2D world (lines) understands the concept of volume. That's how I viewed Steve's messages and his drive for innovation. He's got this idea of how it should be in the future, and uses phrases to help us at Apple to understand (not saying the rest at Apple were not able to understand, but you get my idea). At the same time it's very empowering to know the little things you do, are making a significant change for the Apple customer. (In my case that was for the Europe region).

So, on a more personal note; to me Steve is Apple, and Apple is Steve. I find it hard to imagine an Apple without Steve in charge. It happened before, though. Steve had to leave Apple and came back few years later. While away from Apple he tried to innovate via NeXT. It was OK and Apple came out better (just look at the revenue Year over Year). There's various teams behind the scene that do magical stuff. During some keynotes they're highlighted, but that's just a fraction of the teams. Now, with Steve no longer being CEO, it makes me concerned. But having mingled with the teams responsible for product design manufacturing and the outsourced partners, Apple will do just fine and continue to show their creativity and innovation. Silently, I keep hoping that Steve will become healthy enough to influence Apple as he used to have. For now, I am looking forward to see how Tim leads Apple to the next level. Will miss you, Steve - thanks for the great experience and magic, and good luck Tim. Hoping to see more of Apple in the future.

Eddie Tao

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Fry Phone: Fry Your Brain With Phoney Phone (HiPhone5)

By Michiel Tjoe-Awie


Fake phone

Yang Xi reports for China.org.cn about the Chinese copycat of the Apple iPhone5 that hits the market. Of course it can do what the leaked iPhone5 can do, but it is served with a free dessert: fried brains. Fried brains are cheap. The HiPhone5 is sold for a price that ranges from only 200 Renminbi (31 US dollar) to 1,000 Renminbi (156 US dollar), while you probably have to pay around 7,800 Rmb (1,210 dollar) for the genuine thing (with approved levels of radiation).

Yang writes: "Testing by the Chinese government labs found the fake phones had quality problems, including high electromagnetic radiation levels, said He Guili, a professor at the Chinese Academy of Telecommunication Research."

The makers of the HiPhone5 seem not to have cared too much for the long term health risks that threatens the users. Therefore one is wise to take a risk-avers course of action and don’t exchange “change” for “brains” in case of unapproved counterfeit/copycat phones.

Read Yang's article here.

Even officially approved phones might have damaging long term effects to our health, read here.

Fake site
Josh Smith of GottaBeMobile breaks the news of a very smooth but fake iPhone5 site. To be more precise, the site is real but it pretends to be representing a firm that it's not.
Put on your detective’s head, get out your magnifying glass and do Sherlock Holmes: check the video and figure out what makes the site fake. Hint: think Steve Jobs' legendary eye for detail.

Read Mr Smith's article here.

Read also the Daily Mail article 'The 'hiPhone 5': Fake Chinese version of latest Apple device on sale MONTHS before the real thing is unveiled' here. Thanks Nick Redfearn.


Text Michiel Tjoe-Awie

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Long Island Professor: "Chinese Counterfeiters Cannot Replicate Services" Yes, They Can

Can people outside Long Island
really pour a sturdy Long Island Iced Tea?

Panos Mourdoukouras, professor of economics of Long Island University, gave some reasons for the existence of counterfeit and knock-off retail outlets in China with which I did not agree, see here.

Now he was interviewed by Canada TV (CTV) and I am afraid I again do not agree with him. Professor Mourdoukouras on branding:
"In the long term the only party that is harmed will be China. China will never learn to innovate. Branding involves two things. One, the right product and the right service. Second: the right word of mouth; the buzz. If you copy Apple, Nike, or replicate Starbucks, you also have to replicate the services. What makes Starbucks so successful is the services. Can China replicate the service? No. People sooner or later will found out it is the wrong Apple, Ikea, Starbucks. The stores will have to close down. Word of mouth will spread. Once they found out it is fake they walk away."

I do not concur. First of all knock-off retail outlets do not necessarily provide inferior service. And for example Ikea knock-off 11 Furniture can build up a brand presence by itself. The uncomfortable truth is that high quality counterfeit products do exist, and so does high quality service, which together can satisfy customers. It is naive to believe that consumers stop shopping at a retail outlet once they find out it is fake. I think that is especially not the case when a counterfeit retail outlet with good service sells genuine products, such as in some of the counterfeit Apple Shops. For products that have a negative price elasticity a lower price lures customers if the product "satisfices" (sufficiently satisfactory). The trademark proprietors will still have to do the heavy lifting of closing down these shops via the judicial, administrative or criminal routes of the Chinese legal system.

Watch the CTV interview here.

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Genuine Apple Store Fixes Problem Of Fake Apple

M.I.C. (Made in China) Gadget's Chris Chang wrote that a genuine Apple Store in Pudong Shanghai helped diagnose and troubleshoot his knock-off MacBook Air. Read here.

Now that he is sitting in your nest,
you might as well treat him as your own?

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The Apple Does Not Fall Far From The Tree In Kunming

BirdAbroad is a blogger in Kunming, Yunnan province. She came across a very convincing Apple Store ripoff, and then found two other such stores. Read here investigative post in which she said she was from the Apple corp. in the U.S. in order to shoot some pictures. Read "Are you listening, Steve Jobs?" here.

UPDATE: Michael Martina, 'Chinese authorities find 22 more fake Apple stores', Reuters, August 11, 2011.

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Part III: Lessons Learned from Technology Transfer and Essential IP in China/HK

June 16th, the European Chamber of Commerce in Hong Kong (ECCHK) organised together with the European Union Business Information Programme of Hong Kong and Macao the 3rd annual China IPR SME Helpdesk seminar, this time about 'Technology Transfer and Essential IP Strategies for EU SMEs in Mainland China and Hong Kong'. 

For all companies that are involved in adding or acquiring technology to and from China and want to remit the Renminbis earned, this seminar could not have come more timely. You can find Part I here and Part II you can find here.

Peter Cheung, Director of IPD Hong Kong
Photo: Danny Friedmann

Then it was Peter Cheung's turn. Mr Cheung is the Director of Intellectual Property Department, Hong Kong SAR. He has been representing Hong Kong in WIPO law-making conferences. Mr Cheung settled two WTO disputes (DS 174 US versus EU and DS 290 Australia versus EU, both about trademark protection and Geographical Indications). Mr Cheung's message was that Hong Kong should and could become an IP hub. Hong Kong's advantages are, among many more factors, that it is a bilingual special administrative region and that it is part of China.

Claudia Xu, Director of Hong Kong University of Science & Technology
Photo: Danny Friedmann

After this hopeful and optimistic message Claudia Xu, director of Hong Kong University of Science & Technology (HKUST) spoke about the university's technology transfer centre.

Elizabeth Wong, Associate DLA Piper
Photo: Danny Friedmann

Elizabeth Wong, associate of the Intellectual Property & Technology group at DLA Piper Hong Kong, specialised in trademark law. Ms Wong guided the audience through the economically most important IPRs: copyrights, trademarks and patents. She warned that trademark holders that only have an English name should also register a Chinese character trademark, otherwise there is a big chance that the public will come up with a Chinese character version of the brand, as happened in case of Ralph Lauren's Polo, namely 三脚马 (three legged horse), and also with Salvatore Ferragamo 飞甩鸡毛 (fly off the chicken feathers).

Ralph Lauren does not always use the polo player on the pony
Festival Walk, Kowloon, Hong Kong
Photo: Danny Friedmann

Ms Wong's assessment of good and bad Chinese language marks

Ms Wong also assessed some Chinese characters chosen by international brands. My favorite is Heineken: 喜力 (xi3 li3 in Mandarin, but also phonetic in Cantonese hei lik) which means happy power.

Ms Wong explained that one should register your products/services as broadly as possible. She illustrated it with Apple's application for the iPhone trademark in China in 2002. However, under subclass 0901 computers and computer software. In 2004 Hanwang Technology registered the mark iPhone device in subclass 0907 communication and navigation instruments. Apple lost in the opposition and the subjsequent appeal. Apple had to pay Hanwang Technology a substantial amount to get its mark back. China does protect well known marks, but iPhone was at that time not well known, yet.

Philippe Healey, China IPR SME Helpdesk
Photo: Danny Friedmann

The excellent morning was closed by Philippe Healey who gave a good overview of all the services of the China IPR SME Helpdesk. Check out their website here.

Veronica Llorca and her team of the European Chamber of Commerce have again organised an insightful and inspiring event. Thank you Veronica.

Part I you can find here.
Part II you can find here.

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The Process of Trademark Counterfeiting Captured

How An External DVD Drive Becomes A Counterfeit Apple in 5 Minutes

Dong Men (东门= East Gate) in Shenzhen is an incredible place. You can find buildings with small shops that all sell one component of a mobile phone or computer per floor, and on the next floor another component. On Shennan Central Road there is such a building named 华 Hua 强 Qiang (China Strong) 电 Dian 子 Zi (Electronic) 世 Shi 界 Jie (World) where you can buy external DVD drives.
In this photo series the whole procedure of counterfeiting is captured.

On Shennan Central Road there is a building
where you can find external DVD drives. 

Up the elevator you can see a red banner with yellow characters:
"Severe prosecution will be engaged against those selling counterfeited products illegally"

Here is the empty red casing

Then a sticker with the Apple logo came out of a drawer.

Adhesive plastic removed.

Sticker was placed

And ready is the counterfeit Apple DVD drive.

Just outside of the building is an official Apple dealer

Apple does not make any external DVD drives, to my knowledge. The counterfeit DVD drive, play only, no burning is possible, was on offer for 150 RMB, which is a little bit less than 23 US dollar.

Happy World Intellectual Property Day 2011!

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The lizard's weekly China news roundup

IP Komodo hears righteous indignation expressed by bosses at Beijing's famous Silk Market on Wednesday at a United States trade report that accuses the mall of being "notorious" for fake goods. A Ms Hu stated to the press “I don't care about what any other media is saying about (the Silk Market). We're doing our best to fight against fake goods." 80 percent of Silk Market patrons are tourists. "The guilt for fake goods is shared between the buyer and the seller," she added. During a crackdown in October 2009, authorities found copies of Gucci, Coach and Adidas ready available and the raid led to the arrest of the mall's then-manager Wang Zili, who was charged with allowing the sale of fake goods and taking bribes. IP Komodo would like to hear from anyone who has visited the market in 2011.

Meanwhile in Guangzhou the sale of counterfeit products thrives: China-Africa Commercial Plaza has been required to close after authorities investigated and seized more than 7,600 products, including watches, garments, bags, sneakers, perfumes, cell phones, notebook computers and small household appliances - fake brand names included Rolex, Rado, Citizen, Swatch, LV, Gucci, Hugo Boss, Dior, Polo, Nokia, Sony, Burberry and Apple. Investigators looked into the sales of the counterfeit products on Feb 20 and 21. Fourteen stores in the plaza were believed to have infringed IPRs.

China's food and drug watchdog Tuesday vowed a "ruthless" crackdown on the production and sales of substandard health foods and cosmetics this year. Bian Zhenjia, deputy director of the State Food and Drug Administration said at a national conference that despite stepped-up supervision on the sector last year, the country's health food and cosmetics markets still faced many quality problems. IP Komodo notes a similar problem in his home in Indonesia where echoing the problem in China a couple of years back, a tainted milk scandal has Indonesian consumers panicking over food safety.

WIPO will be delighted at this: Chinese lawmakers on Wednesday began reviewing a revised draft law on the country's intangible cultural heritage (or to give it an acronym ICH). The draft law was submitted to the Standing Committee of the National People's Congress, China's top legislature, for its third reading. This is the first attempt by China to enact a law that safeguards heritage of historical, literary, artistic or scientific value. IP Komodo senses endless seminar opportunities.

Guest post by IP Komodo Dragon

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Nexocial, Dutch Copycat in China

Hugo Leijtens, an ex-Microsoft employee, went two years ago to Chengdu, he describes as the new Silicon Valley. There he became the Chief Technical Officer of Nexocial, a company that came up with an iPad clone in just three months: the nPad, which works on Microsoft Windows C. The nPad will be launched April 3, while the iPad will be launched next summer.

Presenter Jort Kelder of the Dutch television programme about entrepreneurs 'Bij ons in de BV' (With us in the private company) asked Mr Leijtens the following question: "Are you not a petty thief, in the best Chinese tradition?"

Mr Leijtens reply: "I believe Apple has said once 'Good artists borrow. Great artists steal.' "

IP Dragon is wondering whether Apple will sue Nexocial. If they do, let's see if Mr Leijtens will repeat that one liner in court.

The Nexocial site http://www.nexocial.com is not in the air. Don't know what that means.

Read also Willemien Groot's article about Nexocial for Radio Netherlands Worldwide here.

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Is Apple's iPad a Knockoff from Shenzhen Great Dragon Brother's P88, Or Is the Latter A Case Of Pre-emtive Cloning?

Stan Abrams of China Hearsay blogs about Shenzhen Great Dragon Brother's P88, which is very similar to Apple's just released iPad. Mr Abrams, never losing his ironical talent wrote about Shenzen Great Dragon Brother's assertive stance towards IP rights in relation to Apple: "[T]he company apparently filed a design patent, so it’s doing its part to create indigenous IP. All those public education campaigns seem to be working!" Read Mr Abrams' blog here.

Aritz Parra of El Mundo interviewed Mr Wu Xiaolong, CEO of Great Dragon Brother who said that the P88 has been already on the market in China for half a year and was first presented to the world at the International Electronics Fair in Berlin six months ago. Read the article ''Made in China' vs Apple: ¿Quién copió a quién?' in Spanish here.

Earlier, Elaine Chow of Shanghaiist wrote that the P88 was already three months available at the Chinese market, which she calls pre-emtive cloning. Read Ms Chow's article here.

Sometimes Apple has to deal with knockoffs that are better than the real thing, as was the case with the knockoff MacBook Air, read here. Although the P88 has a bigger screen and a much larger disk drive (P88: 160 GB HD versus iPad: 64 GB Flash) and does multitasking and the iPad does not, the P88 has only a battery life of 1,5 hours, while the iPad has 10 hours. Shardendu Gautam compares the technical features for ThinkDigit, read here.

Yesterday, Song Jiang of the site Shanzai.com, that is following the Shanzai (Shan Zhai Ji = 山寨机 , read more about it here ) phenomenon, wrote:

"Just what will happen when the iPad gets launched in China remains to be seen, but I have a feeling that any presiding court in China might just sway in favor of Great Long. This could cause significant ripples in the intellectual property debate surrounding Chinese-made, and more recently, Chinese-designed products and their increasing penetration of traditionally Western dominated markets."

Picture by Shanzai.com.
Read Song Jiang's article here.

UPDATE:

Read Stan Abrams' article 'Shanzhai Saturday: Dawn of a New Era' about double shanzai, read here.

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Chinese MacBook Air knockoffs: Better Than the Real Thing?

Brian X. Chen is running the China Gadget Guide review for Wired about Chinese MacBook Air knockoffs that are on sale in Shenzhen.

"Chinese knockoffs of the MacBook Air could actually be a compelling option for those desiring the razor-thin form factor of the subnote without paying the premium." Read the Wired article here and the China Gadget Guide article here.

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Knockoff Phones Explode And Not Just the Volume

Knockoff mobile phones such as Apple (hi-phone), Nokia (Nckia), Samsung (Sumsang), that sometimes explode or have high radiation, are immensely popular in China, 20 percent of this biggest market in the world! The phones are also exported to Russia, India, Middle East, Europe and US. David Barboza wrote an article about it: 'In China, Knockoff Cellphones Are a Hit' for the NYT, read here.

Mr Barboza explains why it is easy to produce a knockoff mobile phone in China for about 20 US dollar:

• Since 2005 came Mediatek, a Taiwanese semiconductor design company with a turnkey solution that can be used as a platform to produce low cost mobile phones;
• Since 2007 no license is needed to manufacture a cellphone;
• If you are a manufacturer of these so called Shan Zhai Ji (Mountain Bandit Machines), you are not going to pay value-added tax of 17 percent of the revenues;
• Tapping in the supply chains is not difficult, because there are manufacturers that cannot resist a request to run a night shift.

New Chinese brands emerge, such as Meizu, that aspire to emulate Apple. More information about Shan Zhai Ji, read here.

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Apple Victorious In Trademark Conflict With New Apple Concept Digital Technology

Apple, Inc. won trademark case against New Apple Concept Digital Technology Co Ltd based in Shenzhen.

The Intermediate People's Court in Shenyang, the capital of the Liaoning Province, ordered New Apple Concept Digital Technology Co., Ltd., on 2 November to pay 400,000 yuan (58,000 U.S. dollars) for infringing on Apple's trademark and logo.

Read the Xinhua article by Wang Hongjiang here.

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Counterfeit iPhones Smuggled Outside China; Genuine iPhone Smuggled Back Into China

Stop the press! Although also iClones (fake iPhones) exit China to Europe and the US, read here, also genuine iPods manufactured in China for/by Apple are exported abroad. There is a lack of the real thing in China, so the price people want to pay for it rises. Enter smugglers of genuine iPhones, that bring these products back to China.

Mr David Barboza wrote the interesting article: "After China Ships Out iPhones, Smugglers Make It a Return Trip" for the New York Times about counterfeits, genuine products and the so called grey market of parallel import, although one would mention parallel import most of the time in case of cheaper products entering a market. Read Mr Barboza's story here.

Paul Midler of The China Game, has an elaborate two part series about Apple in China. Part 1 is "Apple takes an unfair beating on iPhone", read here.

Tony, who commented on China Law Blog on the misconceptions about China's IP enforcement Catherine Sun debunked in a video presentation, see here, pointed to an article of Mr Patrick Mannion on EETimes about iClones that are better than iPhones, read 'Under the Hood-Video: iPhone clones surpassing original' here.

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