Apple Loses Trademark Battle over "iPhone" in China

Apple Inc. has lost a battle for the use of the "iPhone" trademark in China after a Beijing court ruled against the world's biggest technology company in favor of a local firm. The Beijing Municipal High People's Court said Xintong Tiandi can continue to use the phrase "iPhone" on its leather goods, the class of goods for which the trademark at issue applies.

Hinting Tiandi, a native Chinese entity, applied to register the "iPhone" trademark  with the Chinese intellectual property office in the class of goods that covers for leather goods in 2007, the first year Apple's iPhone went on sale. Apple has been in and out of court disputing the Chinese firm's intellectual property rights since 2012.

Most recently, a Beijing court dismissed Apple's appeal, saying the U.S. firm could not prove the "iPhone" brand was well-known in China before 2009, when it first started selling the handsets on the mainland. In 2012, Apple paid $60 million to end a protracted legal dispute over the iPad trademark in China, which had hampered some sales and delayed the introduction of a new iPad in the country.

The U.S. tech giant has repeatedly found itself tangled in intellectual property disputes in China, where cybersquatting, the registering and/or using of an Internet domain name with the bad faith intent of profiting from the goodwill of a trademark belonging to someone else, runs rampant.

The Chinese market has proven problematic as the home of a vast amount of trademark “squatting,” a very widespread tactic utilized by Chinese businesspeople, many of whom file trademark applications, with the singular aim of capitalizing on non-domestic operations seeking entry into China's thriving retail market, and the fashion industry has not been spared. The practice of bad faith trademark filing has served as a very real problem for fashion brands that are trying to expand East, only to discover that their names and often, numerous variations of their names, have already been registered as trademarks by other entities in China, thereby preventing them from operating businesses in those names. And until relatively recently, brand owners often had few options in terms of fighting such trademark filings in a timely or efficient manner.

The good news for Apple: not all hope is lost. It still has rights in the "iPhone" trademark for computer hardware and software - arguably the most important classes for its brand - in China.