An Accessory Company Sued Apple and Suspect its MFi Certification is “Monopoly”

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The war between Apple and “monopoly” has not ended. For increasing companies, this giant company has affected their growth prospects, and thus they walk on the opposite path of Apple.

On August 28, Pisen, a domestic digital accessories factory, claimed on its official Weibo account that it had formally charged Apple for its MFi certification was suspected of monopolies. Pisen also requires Apple to stop its infringement, and to compensate correspondingly.

According to the pleading Jiemian.com got from an insider, defenses are Apple Inc. (USA), Apple Computer Trading (Shanghai) Co., Ltd. and Apple Electronics Trading (Beijing) Co., Ltd. The last two companies are respectively responsible for Apple’s domestic online transactions, offline retail stores and hardware sales.

In the claim, Pisen requires as follows:

  1. In line with law, the three defendants shall be ordered to immediately stop its monopoly and abuse of market dominance in mainland China (excluding Hong Kong, Macao and Taiwan), that is, to immediately stop MFi certified monopoly civil tort;
  2. In line with law, the three defendants shall be ordered to jointly compensate the plaintiff’s economic losses of RMB 1 yuan caused by defendants’ monopoly civil tort;
  3. In line with law, the three defendants shall be ordered to bear all reasonable expenses the plaintiff spent in safeguarding its rights, including investigation fees, identification fees, notary fees 2,000 yuan, lawyer fee 400,000 yuan, and other costs;
  4. The three defendants shall be ordered to bear the costs of litigation in this case

In the pleadings, Pisen claimed that since Apple used Lightning, the sole correspondence and irreplaceability between its products and accessories have been further improved. Thus, Apple products can only use accessories that defendants or their licensed third parties specifically produced rather than accessories produced by other manufacturers. While the third-party accessory production or design manufacturers can only purchase chips from defendant’s designated chip manufacturers at fixed price, and need to pay unfair high MFi authentication fee to the defendants. That has caused Pisen unable to compete fairly in the market with Apple.

According to Pisen, the case has been accepted by the Beijing Intellectual Property Court.

In Pisen’s Weibo, it adds a moment released in WeChat by Zhao Guocheng, Pisen’s president, “Apple is by far one of the greatest companies in the world. Both Jobs and Cook are great entrepreneurs I respect, but even great enterprise can’t damage consumer rights and interests!”

The MFi certification is a license that Apple grants to its authorized parts manufacturer, which means “Made For iOS”. Generally speaking, when the Apple MFi authorization logo appears on the white background of the product, it means that the product is recognized by Apple.

As for accessories absent of MFi certification, every time iOS system upgrades, these accessories can’t be used anymore as they are unauthenticated, which can even lead to product explosions, burning and other problems. According to Apple’s rules, they do not provide warranty for products that have such problems.

According to the information obtained by Jiemian.com, Pisen’s move aims to break Apple’s monopoly on the market under MFi certification. According to insiders of Pisen, they have had national professional certification evaluation institution to test MFi standard and the results found that the certification standard has no safety value Apple claims. The test results will be published by Pisen in someday.

“It equals that Apple has added a toll booth on each USB cable. It won’t be open to third-party accessory makers unless they pay for it. And we are just trying to break this closed monopoly.” said the person.

In November, the IT Times reported that the number of Apple licensed vendors worldwide had risen rapidly to around 900. But Jiemian.com found that Pisen is not on Apple’s MFi certification list.

“The main purpose of Apple is to make sure that users are safe when using accessories, but Pisen might think Apple sets the standard to charge third-party vendors and thus Apple monopolizes the market.” an Apple accessory maker said to Jiemian.com.

He also noted that in the absence of MFi certification, the Apple accessories produced by third-party manufacturers are very difficult to sell to foreign countries and can only be sold in the domestic market.

It is not the first time that third-party Apple accessary manufacturers have been involved in a dispute with Apple over the MFi issue. Hehong Industrial Co., Ltd. in Shenzhen and Haineng Industrial Co., Ltd. in Anfu County, Jiangxi Province are two companies produced USB cables for Apple and were respectively canceled the qualification of authorized production by Apple in November 2016 and January 2015.

Both companies, however, have filed IPO prospectus to CSRC (China Securities Regulatory Commission) and are in the process of going public. Currently, neither of them has the IPO.

Just at the beginning of this month, some domestic relevant developers held a conference with the lawyers and legal experts team. They thought that the App Store operated by Apple is alleged illegal, tort and monopoly in the long-term operation and reported it to two antitrust law enforcement departments, namely, SAIC (the State Administration of Industry and Commerce) and NDRC (National Development and Reform Commission). It seems that Apple needs to deal with “monopoly” for a while.

 

This article originally appeared in Jiemian and was translated by Pandaily.

Click here to read the original Chinese article.

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