A Shanghai court has rejected a request by a Chinese technology firm to stop Apple Inc. selling its iPad tablet computers in the city, a source said, part of a wider battle for Apple over the trademark in China.
The Shanghai Pudong New Area People's Court ruled in Apple's favour after a hearing on Wednesday, the source with direct knowledge of the ruling said, confirming a report by the website of local official newspaper Xinmin Evening News.
The Chinese company, Proview Technology (Shenzhen), had said the U.S. tech giant was infringing on a trademark it owns in China.
China is important to Apple not only as a consumer market, but also because the country is a major production base for the iPad and other Apple products.
The dispute, which dates back to a disagreement over what was covered in a deal for the transfer of the iPad trademark to Apple in 2009, has seen iPads seized by authorities in some Chinese cities, and some retailers in some Chinese cities have stopped selling them under court order.
The victory for Apple follows a string of defeats in other Chinese courts, and averted what could have been an embarrassing suspension of iPad sales in Apple's own flagship stores, of which it has three in Shanghai.
However, it was still not clear whether a separate effort by Proview to seek compensation in the Shanghai court from Apple for alleged trademark infringement would be successful.
Apple disputes Proview's ownership of the trademark, saying it bought the rights to the name in China from Proview in 2009.
Apple is also appealing a decision from December by a Shenzhen court, which ruled in Proview's favour. A higher court hearing for the appeal is set for February 29 in China's southern province of Guangdong.
Following the Shenzhen case, Proview has launched a multipronged approach to get Apple's iPads off the shelves in the world's second-biggest economy, with mixed success.
It has petitioned Chinese customs to stop shipments of the iPad in and out of China, although authorities have indicated such a ban would be difficult to impose.
Proview has won cases in some smaller cities, forcing some retailers to stop selling iPads.
Proview's parent, Hong Kong-listed Proview International Holdings Ltd., was the first Taiwanese technology company to list in Hong Kong and by the end of the 1990s numbered itself among the top five computer monitor makers.
In 1999 it partnered 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.
Proview continued to grow, shifting from computer monitors to become the world's third-largest OEM manufacturer of flat panel TVs. But by August 2009, when Apple began trademark talks through a proxy, Proview had been badly hammered by the financial crisis.
Trading of its stock was suspended in Hong Kong in August, 2010, after creditors in China went to court to recover assets. The company faces delisting in June if it cannot provide the Hong Kong Stock Exchange with a viable rescue plan.