Crunch time for Apple Watch in Switzerland

Duncan J. Morgan | June 2015

Apple, Inc. (formerly Apple Computer, Inc) expanded their product range recently with the launch of the ‘Apple Watch’.  At the time of writing, the product is available for pre-order only in nine countries around the world, including the United States, United Kingdom and Japan.  One country in which the product is not yet available is Switzerland, and there is speculation in the IP world about a possible problem Apple may face launching there.

Trade mark registrations protect marks in relation to specific goods and services from the date they were filed, and as a result there may be a storm brewing as regards Swiss Trade Mark Registration no. P-343807:

The problem?  This registration does not belong to Apple, Inc., it belongs to the Geneva-based company Leonard Timepieces SA, and since December 1985 has protected watches.  In theory at least, this registration could be used to prevent Apple registering their name for watches in that country, and, more seriously, to seek an injunction preventing them from using their name in relation to such goods in Switzerland.  At the time of writing however, we are not aware that any such actions have commenced.

This brings into focus not only the difficulties multi-national companies face in launching global brands in a world where trade mark rights remain largely limited by territory, but also the risk that innovation and technological advancement can see existing trade marks used in business sectors not previously envisaged (and hence potentially outside the scope of their trade mark protection).

Apple, Inc. have faced similar problems in the past, perhaps most famously in their longstanding dispute with Apple Corps (the holding company owned by the Beatles, which itself owned their record label Apple Records).  A dispute between Apple Computers and Apple Corps about entitlement to the Apple name began in 1978, and was understood to have settled with an agreement whereby Apple Computers would not enter the music business, and Apple Corps would not enter the computer business.  However the conflict was reignited in the mid-1980s when audio recording capabilities were added to certain Apple Computers products.

A second settlement between the parties was reached in 1991 wherein Apple Corps were permitted to use the trade mark Apple in relation to "creative works whose principal content is music", and Apple Computer could use the mark in relation to "goods or services ... used to reproduce, run, play or otherwise deliver such content", but not when this content was distributed on physical media.

However, in 2003 Apple Corps launched proceedings for breach of contract, arguing that Apple Computers’ use of the mark Apple in relation to the iTunes Music Store was contrary to the 1991 agreement.  A further settlement was reached in 2007, paving the way for The Beatles’ back catalogue to finally be made available on the iTunes platform in 2010.

When Apple Computer was founded in the 1970s (and the name Apple chosen), the computer and music industries were not nearly as related as they have become over the past fifteen years.  The innovations made by companies such as Apple in pushing such fields closer together can have unintended consequences in relation to trade marks, causing conflicts which may not reasonably have been anticipated by parties when their names were chosen.

From a practical point of view, this reminds us of the importance of, where permitted, filing applications to cover not only the goods and services applicants offer, but also those they intend to offer in future, or conceive that they may so do.  However, businesses cannot provide for every eventuality, particularly if filing applications at an early stage of their development when budgets do not necessarily stretch too far.  Therefore regular review of one’s trade mark portfolio is also very important, with an eye on the perceived direction of the business, and innovations which may be in the pipeline, such that protection can be sought at the earliest opportunity, and hence reduce the chances of conflict down the line.

As regards whether Switzerland will see the Apple Watch, we imagine a solution will be found.  There is considerable speculation as regards whether or not the Swiss registration has been used sufficiently to allow it to be enforced at all.  Further, Apple, Inc. has faced similar conflicts in individual countries on the launch of a new product before.  Solutions tend to be found quickly and, it seems more often than not, privately.  Indeed, this is not even the first timepiece-related problem the company has had in Switzerland.  The company is understood to have agreed a licence with the Swiss Railway company SBB in 2012 within days of the latter claiming that the clock face used in Apple’s operating system too closely resembled their own.