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Lawsuit Happy Apple May Not Be Able To Sell iPhone In Mexico

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English dictionaries should add the name Apple as a synonym to ‘lawsuits’.

Apple is in big trouble in Mexico, right before the holiday season starts. The company has lost rights to the name iPhone in the country as it was already owned by a Mexican telecom company named iFone. Trademark conflicts are not new but the way Apple handled this one (and all others) shows how arrogant this company is.

The Fact
The Mexican company registered the trademark iFone way back in 2003, a full four years before Apple filed to trademark the name iPhone (which was already owned by Cisco, more about that later). Apple, despite being fully aware of the fact that the Mexican company owned the trademark since 2003, sued them in 2009 to invalidate the iFone trademark. So Apple wanted the iFone brand to be invalidated, which was filed in 2003, because it was similar to iPhone name which was filed in 2007.

Excellent.

The Mexican company was operational since 2002 but registered the trademark only in 2003. The company sells communications systems and services, including interfaces for IP-based telephone calls, virtual office services, and software for switching systems.

The name iPhone has been in controversy since its inception. It must be noted that Cisco owned the trademark iPhone and they raised issues with Apple using the same name for its product. Cisco obtained the iPhone trademark in 2000 after completing the acquisition of Infogear, which previously owned the mark and sold iPhone products for several years.

Apple, known for not respecting other’s trademarks, went ahead and announced the launch of the iPhone, despite concerns from Cisco. On January 10, 2007 Cisco filed a lawsuit in the United States District Court for the Northern District of California against Apple, seeking to prevent Apple from infringing upon and deliberately copying and using Cisco’s registered iPhone trademark.

“Cisco entered into negotiations with Apple in good faith after Apple repeatedly asked permission to use Cisco’s iPhone name,” said Mark Chandler, senior vice president and general counsel, Cisco. “There is no doubt that Apple’s new phone is very exciting, but they should not be using our trademark without our permission.

In February 2007, the two companies settled their dispute and agreed to use the “iPhone” name in exchange for “exploring interoperability” between Apple’s products and Cisco’s services and other unspecified terms.

Back To iFone
This time again Apple did not care about the fact that the Mexican company held the trademark since 2003 and sued them. Now the 18th District Appellate Court on Administrative (Mexico) has denied the appeal filed by Apple and said that the Mexican company is the rightful owner of the name iFone.

It may mean a lot of troubles for ‘sue first talk later‘ Apple which is engaged in dozens of lawsuits around the world. This decision may have a significant impact on Apple’s market in Mexico as they may not be able to use the name iPhone in the country (depending on how the case further progresses). The timing of this decision, just before the holiday season, is nothing short of A Nightmare At The Mexico City for Apple.

Apple needs to hold its horses back. Apple needs to stop its ‘sue everyone else’ drive as it has started to come back and bite them. Apple was reprimanded yesterday by a UK court for ‘breaching a court order’.

Mexico is going to spell more troubles for Apple as not only they will lose the ability to sell their devices under the brand name iPhone, they also face a counter-suit by the Mexican company which is seeking damages (a minimum of 40% from all iPhones sales to date in Mexico).

This lawsuit had a toll on the Mexican company, Antonio Trevino, CEO of iFone, admitted that this lawsuit affected their growth as they had to divert their attention towards this lawsuit to defend their brand. Lawsuits are expensive and it seems to be one of Apple’s core strategies to exhaust their competitors in courts so that they have little time to innovate and compete against Apple. HTC is the latest victim which has been slowed down by Apple’s lawsuit frenzy.

These lawsuits are not good for customers or for the market. The resources which should be invested on developers, engineers or R&D to bring out better products are now being wasted on lawyers who don’t add any value to the product. These lawsuits are bad for Apple as they are tarnishing its public image. Even the hard-core Apple fans are now supporting social movements like #BoycottApple.

Apple needs to learn that the best way to capture the market is by making better products and not by suing every one else just because they can. Apple has been playing with fire for too long and the flames have now started to burn its fingers.

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Tim Cook recently reshuffled Apple’s top brass, will he also kick all the lawyers out and make Apple a more civilized company?

Slideshow Image:
Swapnil Bhartiya

A free software fund-a-mental-ist and Charles Bukowski fan, Swapnil also writes fiction and tries to find cracks in the paper armours of proprietary companies. Swapnil has been covering Linux and Free Software/Open Source since 2005.

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