Apple (NSDQ: AAPL) is putting a big bet on China, where its products and services have proven hugely popular, but that could also leave it exposed to a few bad beats along the way: the company is currently being sued by a group of Chinese writers, who are accusing the company of copyright infringement over some books on offer in its app store. It’s an ironic turn of events, given that Apple has been battling extensive copyright infringement of its own in the country, in the form of counterfeit products.
The group of nine writers, operating under the China Written Works Copyright Society, claim that some 37 works have been published in Apple’s App Store without their agreement. Their 12-billion-yuan ($11.9 million) lawsuit entered formal proceedings in Beijing last week, according to the English edition of the Chinese business news site Caixin Online.
The group includes pop culture figure Han Han, a politically-controversial author, Li Chengpeng, as well as other popular writers like Cang Yue and Murong Xuecun, the report says. There’s a screenshot of a Murong Xuecun app pictured here. Developed by “Portege Pte”, it’s unclear whether this is one of the authorized or unauthorized works.
As with other paid apps and books in Apple’s App Store, Apple takes a 30 percent commission on every purchase.
The CWWCS has been through this before with other companies that have been involved in the illicit distribution of their work via e-books: in 2010 Google (NSDQ: GOOG) had to issue the group a formal apology for a similar offense; in 2011, Baidu (NSDQ: BIDU) deleted 2.8 million works from its Wenku e-book portal at the group’s request. Similarly, there have been two other suits against Apple over ebooks: one involving an individual writer and other concerning a group of six authors. It’s not clear in these past cases if the portals in question made financial settlements when dealing with the cases.
As with the counterfeit Apple stores that were closed down last year, it may well be the case that ordinary consumers have no idea that they are paying for books that are illicit. Created and published by third-party developers, some of the more popular works have seen up to one million downloads in Apple’s App Store. That also puts these e-books into the same category as digital music in the country, where of tracks have been published by those not authorized to do so, and many consumers downloading them are none the wiser.
Of course, $1.9 million in compensation is small change to one of the world’s biggest and most profitable companies, but even being accused as a facilitator of copyright infringement must be an embarrassment for Apple. China is a significant strategic investment the company, which has made a big push into China in the last year — ramping up its retail presence, making its App Store more local-currency-friendly, and (if you believe reports) even expanding its production in the country.