When I was writing about the case of Apple Inc. (NASDAQ: APPL) losing an appeal in Mexico over the use of the iPhone name against Mexican telecommunications company iFone, I thought that if Apple submitted to paying iFone what it was asking for (the 40 percent of its iPhone’s sales in Mexico), other companies would take it as an invitation to act in the same way. (See: iPhone vs. iFone: Apple Loses Appeal in Mexico.)
Laws can be tricky in some places, created specifically to benefit the locals. This is not news for anyone, isn’t it?
Thanks to some readers who had similar thoughts, and good, passionate discussion on the topic, I went on a quest to find out more about the existence of similar cases. And voilá ! I did: A recent, ongoing case in Brazil.
What's this Android iPhone Neo One, anyway?
As if the iFone case isn't bad enough for Apple, wait until you hear about Grandiente’s iPhone Neo One (pictured, below) in Brazil.
In March of 2000, Brazilian telecommunications service firm IGB Electronica, which owns the brand Grandiente, filed an application for registration of the trademark "iPhone" at the Institute of Intellectual Property (INPI) in Brazil, demanding exclusive rights to the name. At the time, Apple’s iPod, iTunes, and iMac were known in Brazil.
The INPI, taking its time, granted the rights to the name iPhone to IGB Electronica seven years later, in November 2007. Strangely enough, this happened four months after Apple tried to register the trademark iPhone in July. Coincidence? I don’t think so. The INPI denied Apple’s request, saying they wouldn't accept two records of the same brand for the same product category. How convenient.
Despite having enough time after receiving the trademark registration by the INPI in 2007, it was not until December 18, 2012 that Grandiente, having also declared bankruptcy, launched its iPhone Neo One, which runs on Android. It did so 15 days before the expiration of its exclusive right to use the trademark in Brazil (a record expires in five years if it is not used). Again, how convenient.
Of course, the money Apple might have to pay will help the company to recover, right? Right.
According to Folha de São Paulo, Brazil’s largest daily, Apple and Grandiente have been negotiating an "amicable solution," since early January for the use of the iPhone trademark in Brazil.
It sounds to me like Apple is just tired of all these instances where there is always a reason -- which never seems to make sense -- why it ends up losing these fishy cases. Although, this time, bankruptcy seems to be a clear reason for a company trying to get easy money from Apple. I see too many unethical issues going on here; issues that are only solved by Apple paying large amounts of money.
In a nutshell, all these cases seem to end in expensive settlements between Apple and the companies that are trying to get easy money. These are not cases of over-patented, innovative technologies. These are disputes over the rights of using a name. How far are these companies going to go if Apple continues paying what they demand? Are the Mexican and Brazilian markets really significant enough to Apple in terms of ROI, and worth the trouble, time, and money?