Chinese authorities are grabbing Apple iPads off the shelves in Northern China stores because the domestic Shenzhen Proview Technology company claims ownership of the name "iPad."

Apple will face a $38 million fine for using the "iPad" name in China, according to a Proview rep. As Mashable previously reported, Apple bought the rights from Proview Electronics' parent company Taiwan-based Proview International Holdings in 2010, but rights have not extended to China.

Proview has registered trademarks for the name "IPAD" in Europe, Mexico, China and other parts of Asia, according to the L.A. Times.

Proview successfully sued Apple last December for $1.6 billion. Apple is appealing the decision.

Tablets started coming off the shelves on Thursday. There are no reports of how many devices or number of stores affected. Local news reports state that some Apple stores are holding them in back rooms to avoid products being confiscated.

This news comes amid reports that Apple could grab hold of China's mobile device market by 2013.

Tell us in the comments what you think Apple should do in this expensive name dispute.

Thumbnail image courtesy of Flickr, Yutaka Tsutano