Proview to face Shenzhen court
Provincial court orders technology firm to face creditors' claims for a backruptcy hearing
Mainland company Proview Technology moved a step closer to bankruptcy yesterday after the Higher People's Court of Guangdong province asked an intermediate court in Shenzhen to hear the case.
Proview Technology recently received a US$60 million payout from US technology giant Apple under a settlement mediated by the same Guangdong court.
The Apple payout ended a long and bitter legal dispute over the use of the iPad name on the mainland.
Despite that windfall, the Shenzhen-based company is mired in debt and creditors have asked that the company be placed into bankruptcy. Its Apple payout has been frozen by mainland courts.
Fubon Insurance is one creditor that has been pushing in the courts for Proview Technology to be declared bankrupt. But Fubon's request was rejected in March by a court in Shenzhen after Proview Technology argued that it could pay its debts based on its expectations of winning some compensation from Apple.
The Shenzhen court then decided it was not clear if Proview Technology would be insolvent because it was not yet clear how much Apple compensation it would get.
Fubon, a subsidiary of Taiwan-based Fubon Financial, appealed against that judgment in April, which led to yesterday's court decision that Proview Technology's assets are not enough to pay off its debts.
The legal battle between Proview Technology and Apple started in 2010, the year Apple launched its iPad media tablet. The dispute was settled in June when Proview Technology agreed to transfer its two mainland iPad trademarks to Apple in exchange for the cash settlement. Proview Technology had originally asked for US$2 billion in compensation.
The settlement paved the way for Apple to sell the third version of its popular iPad on the mainland. China, comprising Hong Kong, the mainland and Taiwan, is the second-biggest market for Apple products after the US.
Technology research firm IDC forecast the mainland's total volume of media tablet sales would grow nearly 30 per cent this year.