Swatch just lost a bid to stop Apple owning ‘iWatch’ in SA – in part because of rich buyers

• Swatch has lost a final legal bid to stop Apple from trademarking the word “iWatch” in South Africa.
• Apple has never used the term iWatch, which it doesn’t own in the USA, but registered it locally anyway.
• “Swatch” and “iWatch” just aren’t so similar as to be confusing, said the Supreme Court of Appeal on Friday.
• It helps that both target discerning, affluent users, the court said – who aren’t likely to accidentally buy the wrong watch. 
• For more stories go to www.BusinessInsider.co.za.

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Swatch has failed to block Apple from trademarking “iWatch” in South Africa.

On Friday the Supreme Court of Appeal (SCA) dismissed what is likely to be a final legal effort by the legacy watch company – which has owned a trademark in South Africa since 1986 – to stop the technology newcomer from marketing its watches under that name.

Apple, the maker of the iPhone, the iMac, and the iPad, has never sold its Apple Watch as the iWatch, though it registered that name in several territories. In critical markets, including China, the United States, the United Kingdom, and the European Union, others got to the name first, and threatened dire consequences should Apple try its luck.

In South Africa, Swatch’s arguments of similarity to its own trademark were dismissed by the high court, and now on appeal.

There just isn’t enough similarity between “Swatch” and “iWatch” to cause trouble, the SCA said, though it helps that both types of watch are aimed at discerning and affluent buyers, who are unlikely to pick up the wrong one by accident.

The fact that both Apple and Swatch have well known brands are not important in law, said acting SCA judge David Unterhalter, but even ignoring that, Swatch’s arguments about “obvious similarities” did not hold up.

Swatch said that similarities include that neither trademark is registered with a logo, and both use the word WATCH with just a single prefix letter.

It argued that there is little visual difference between “S” and “I”, and that the spoken versions are similar. 

The judges didn’t hear it.

“[T]he ‘I’ joined to ‘WATCH’ makes up a word of two syllables pronounced, without phonetic exactitude, as ‘eyewatch’ or ‘ayewatch’. That sounds very different from the monosyllabic word SWATCH, when spoken,” wrote Unterhalter in judgment.

Nor could the court find sufficient visual or conceptual similarities to block Apple’s trademark.

That may have been enough to dismiss Swatch’s efforts, but its emphasis on the sophistication of its watches seems to have undermined its efforts further.

Marketing material submitted by Swatch, said the court, “is clearly directed at discerning, fashion conscious consumers”. Meanwhile, Apple’s description of its watches “leaves little doubt that these products are innovative offerings, also made to discerning consumers.

“These consumers are likely to be more affluent and more concerned with the precise brand of watch they require. Consumers of this kind are less likely to be deceived or confused by the limited similarities between the marks,” said the court.

(Compiled by Phillip de Wet)

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