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Chinese Animation Studio Sues Apple Alleging Illegal Movie Sales on iTunes

29 Mar, 2013 By: Erik Gruenwedel

Shanghai Animation Film Studio reportedly has filed a lawsuit against Apple and a Chinese subsidiary claiming its movies have been illegally sold on iTunes.

The studio, which is backed by the Chinese government, claims 110 movies were sold without permission on iTunes, including Calabash Brothers and Black Cat Detective. SAFS in seeking $500,000 in monetary damages.

“We want to keep tight-lipped on this case because, as we see it, it's just a litigation in which we want to get compensation [for our product],” an official from the Shanghai studio told South China Morning Post, which first reported the story.

An Apple rep told the publication it doesn’t comment on litigation.

While the litigation would appear minor to a tech giant like Apple, it comes at a time when the Cupertino, Calif.-based company is on the receiving end of heightened criticism from the Chinese government.

In a March 28 editorial in the Communist Party’s official newspaper, the People’s Daily, Apple  was accused of displaying “unparalleled arrogance” regarding issues with its iPhone. The paper also accused Apple of not investing more R&D infrastructure in China.

Yet, Apple currently outsources more than 90% of its manufacturing to China and Southeast Asia, according to Global Sources, a business-to-business media company and facilitator of trade with China. Indeed, clothing and consumer electronics such as DVD players are among the top 10 Chinese imports to the United States.

Doug Young, a former Reuters journalist who now teaching financial journalism in Shanghai, said the negative press on Apple in China is largely unwarranted, despite agreeing that the company needs to abandon its “culture of secrecy.”

“If [Apple] fails to modify its game plan, it stands the very real prospect of facing repeated assaults in the official Chinese media, which will hurt its image, its reputation and ultimately its sales in China,” Young wrote in a March 28 blog.


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