Apple to appeal after losing trademark case in China

Apple Inc will appeal a trademark ruling to China's Supreme Court after it lost a four-year fight against a Beijing leather-products maker.

The Beijing Municipal High People's Court recently ruled in favor of Xintong Tiandi Technology (Beijing) Ltd, which sells a number of leather products such as smartphone cases and handbags under the name "IPHONE", according to The Legal Daily, a Chinese state-run newspaper.

"Apple is disappointed the Beijing Higher People's Court chose to allow Xintong to use the IPHONE mark for leather goods when we have prevailed in several other cases against Xintong," Josh Rosenstock, Apple spokesman, told China Daily in an e-mail. "We intend to request a retrial with the Supreme People's Court and will continue to vigorously protect our trademark rights.

"We work hard to make the best products in the world and want to ensure our customers' experience is not compromised by companies who try to profit from using our brand," he said.

The ruling was applauded by Xintong. In a statement posted on its website, the Chinese firm said, "From now on, ‘iphone' is not only a smartphone! From now on, ‘iphone' does not belong to Apple exclusively! This ruling means that the intellectual property of ‘iphone' has been granted market freedom."

According to The Legal Daily report last week, Apple applied for the iPhone trademark under international trademark class 9 (electrical and scientific apparatus) in China in 2002, but it wasn't granted until 2013.

Xintong Tiandi filed for its IPHONE trademark in China in 2007 under international trademark class 18, which is leather goods. In the same year, Apple launched its first iPhone in the United States.

In order to obtain exclusivity on the iPhone trademark in China, Apple first took the case to the Chinese trademark authority in 2012, but it failed as the agency claimed Apple couldn't prove iPhone was a well-known brand in China prior to Xintong Tiandi's registration in 2007.

Apple then filed a lawsuit in a Beijing court. However, the court ruled against the California company, and Apple appealed to the Beijing Municipal High People's Court. The high court upheld the lower court's ruling, saying that the company didn't sell the iPhone on the Chinese mainland until 2009.

Apple's latest quarterly earnings showed a 13 percent drop in revenue as sales of iPhones slipped. China was a particularly weak spot as sales in China fell 26 percent to $12.49 billion.

"The failure of the trademark fight would not have a great impact on Apple's brand and image but it might confuse consumers as they don't know whether these products are made by Apple or some producers (copying) Apple's name when they are buying leather products embossed with the ‘IPHONE' brand," said James Yan, a Beijing-based analyst at Counterpoint Technology Market Research.

Zhu Dalin, an analyst at Beijing-based Internet consultancy Analysys International, said the influence of Xintong Tiandi is minor and wouldn't pose a threat to Apple anyway.