THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT

Not Reportable
Case no: 1320/2018

In the matter between:
SWATCH AG (SWATCH SA)

APPELLANT

and

APPLE INC.

RESPONDENT

Neutral citation: Swatch AG (Swatch SA) v Apple Inc. (1320/2018)
[2021] ZASCA 11 (29 January 2021)
Coram: WALLIS, MOCUMIE and MAKGOKA JJA and GORVEN and
UNTERHALTER AJJA

Delivered: This judgment was handed down electronically by
circulation to the parties’ representatives by email, publication on the
Supreme Court of Appeal website and release to SAFLII. The date and
time for hand-down is deemed to be 09h45 on 29 January 2021.

Summary: Opposition to the registration of a trade mark in reliance upon
ss 10(12), 10(14) and 10(17 of the Trade Marks Act 194 of 1993 –
considerations relevant to a determination of whether the marks are
confusingly or deceptively similar – Comparison of the trade marks
SWATCH and IWATCH – The issue of inclusion in the family of
i-prefixed trade marks

ORDER

On appeal from: The Gauteng Division of the High Court, Pretoria
(Fabricius J, sitting as the court of first instance):

The appeal is dismissed with costs.

JUDGMENT

UNTERHALTER AJA (WALLIS, MOCUMIE and MAKGOKA
JJA and GORVEN AJA concurring)
[1] The respondent, Apple Inc. (‘Apple’) applied to register its
IWATCH trade mark in classes 9 and 14. The appellant, Swatch AG
(Swatch SA) (‘Swatch’), opposed these applications. Swatch is the
proprietor of the trade mark registration no. 1986/04168 in class 14,
under the representation SWATCH. Swatch’s opposition relied upon
ss 10(6), 10(12), 10(14) and 10(17) of the Trade Marks Act 194 of 1993
(‘the Act’). In essence, Swatch contended that the IWATCH and
SWATCH marks are confusingly similar and thus the IWATCH mark, in
respect of the classes of goods for which registration was sought, was
likely to deceive or cause confusion.

[2] Swatch’s opposition was brought before the Registrar of Trade
Marks who transferred the proceedings to the high court in terms of
s 59(2) of the Act. Fabricius J heard the matter and dismissed the
opposition with costs. Upon an application of the well-established
considerations set out in Plascon-Evans Paints Ltd v Van Riebeeck Paints
(Pty) Ltd 1984 (3) SA 623 (A), he found that the trade marks IWATCH

and SWATCH were not confusingly similar. With his leave, Swatch
appeals to this court. The parties agreed that the appeal may be disposed
of without the hearing of oral argument, and, in terms of s19(a) of the
Superior Courts Act 10 of 2013, we decided to do so.

[3] In the high court, Swatch did not pursue its opposition under
s 10(6). Before us, Swatch’s opposition relied upon ss 10(12), 10(14) and
10(17) of the Act. Although these provisions have certain distinctive
requirements, absent a finding that, upon a proper comparison, the two
marks are deceptively or confusingly similar, Swatch’s grounds of
opposition cannot prevail.  It is to this central issue that I turn.

[4] The considerations that are relevant in the comparison of two
marks, to determine whether they are deceptively or confusingly similar,
are to be found in Plascon-Evans,1 and the cases that have followed and
elaborated upon that exposition.2 These considerations were common
ground before us. Their full repetition would be otiose. Among the
matters that may be informative to make a proper comparison are the
following. What are the visual, aural and conceptual similarities of the
marks? The overall impression given by the marks is salient, bearing in
mind their distinctive and dominant components. How would the marks
be perceived by the average consumer, in the relevant market, who is
reasonably well-informed and observant, taking account of the type of
goods and how they are marketed? The consumer may not encounter the
goods bearing the marks at the same time and place, and an allowance

1 Plascon- Evans supra 640G – 641E
2 Bata v Face Fashions CC and Another 2001 (1) SA 844 (SCA) para 9; Cowbell AG v ICS Holdings
Ltd 2001 (3) SA 941 (SCA) para 10.

should thus be made for the consumer’s imperfect recollection of the
marks. The degree of similarity of the goods should be considered in
relation to the degree of similarity of the marks. The greater the similarity
of the goods the more it may offset some differences in the marks, just as
greater distinctiveness of the goods may require greater similarity of the
marks in order to justify an affirmative finding of the likelihood of
confusion.

[5] The two marks that require comparison are these:

IWATCH

[6] Swatch contended that there are obvious similarities. Both trade
marks consist only of letters, they employ no logos or other
distinguishing matter, although Swatch frequently uses its mark in
conjunction with a reproduction of the Swiss national flag. Both have the
common element of WATCH, preceded by a single-letter prefix. That one
mark starts with an S and the other with an I does little to provide visual
differentiation. Furthermore, so it was submitted, the marks sound similar
when spoken. Neither SWATCH nor IWATCH have any meaning, at
least when used in relation to watches. These are the very goods covered
by Apple’s class 14 application and they are identical to the goods
covered by Swatch’s class 14 registered mark, that is to say, ‘horological
and chromatic instruments; watches; clocks; timepieces’.

[7] I proceed to make a visual, aural and conceptual comparison of the
marks. In doing so, I discard from consideration any preconceived
notions associated with two such well-known brands in the market:

Swatch and Apple. The ubiquity and durability of the two brands might
give rise to an implicit assumption of their distinctiveness, with the
impermissible entailment that the two marks at issue in this case are
distinctive and hence are not confusingly similar. That is not the exercise
of comparison enjoined by the authorities to which I have referred. The
court’s obligation is to compare the marks themselves, and not to permit
something external to the marks to intrude upon the process of
comparison. Rather, from the vantage point of the average consumer, in
the relevant market, what does a comparison of the marks yield as to their
similarity and differences so as to determine the ultimate issue as to
whether the marks are deceptively or confusingly similar.

[8] As to a visual comparison of the marks, both marks make use of a
common element, the word ‘WATCH’, which does make for some visual
similarity. However, the use of the same descriptive word, of a
commonplace item, serves to place greater emphasis on the significance
of the prefix in each of the marks. It is the ‘I’ in IWATCH that is the
visual differentiator of the mark. So too, the joining of ‘S’ to ‘WATCH’,
to make up the word ‘SWATCH’, provides a visual cue based on the
word rather than its component parts. These features of the marks give
rise to a clear visual differentiation.

[9] As to the aural comparison, the ‘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. Something was made by
Apple of the fact that swatch is an ordinary word in the English language
meaning a small sample of fabric intended to demonstrate the look of a

larger piece. The proposition advanced was that consumers seeing or
hearing the mark SWATCH would associate it with the English word, an
association entirely remote from IWATCH. I attach no weight to this
consideration. I am doubtful that the average consumer would readily call
to mind an association between a watch and a small sample of fabric.
However, even shorn of any such association, and taking SWATCH as an
unmoored word, an aural comparison of IWATCH and SWATCH
indicates a clear difference.

[10]  As with the visual comparison, there is some conceptual identity
in that both marks reference WATCH. However, as I have already
observed, the use of the word ‘watch’ is a descriptive word. The
SWATCH mark enjoys no distinctiveness by incorporating a descriptive
word of obvious relevance to the goods in respect of which the mark is
registered. As this court made plain in Yuppichef; 3‘ … it is not the
purpose of trade marks or copyright to enable people to secure
monopolies on the commons of the English language.’ There is good
reason to avoid attaching exclusive rights to common descriptors. And in
consequence, little reason to attach significance to the use of the word
WATCH as a point of conceptual identity.

[11] There is a further consideration that supports the same conclusion.
Swatch is the proprietor in South Africa of the trade mark SWATCH. The
trade mark registration is endorsed as follows: ‘Applicants admit that
registration of this trade mark shall not debar other persons from the bona
fide descriptive use in the ordinary course of trade of the word WATCH.’

3 Yuppichef Holdings (Pty) Ltd v Yuppie Gadgets Holdings (Pty) Ltd [2016] ZASCA 118; 2016 BIP
269 (SCA) para [38]

Swatch enjoys no exclusive right to the use of the word WATCH when,
as here, Apple has sought to secure the registration of IWATCH, and to
use this mark in the ordinary course of its trade.

[12] Once the use of the word WATCH in both marks is deprived of
conceptual significance, there is little on this dimension of judgment to
conclude that there is availing conceptual similarity between the two
marks.

[13] A visual, aural and conceptual comparison of the marks, I find,
does not yield similarities of sufficient significance to make the marks
confusingly or deceptively similar. This conclusion is supported by the
following consideration. Swatch has emphasised in its founding affidavit
that Swatch watches are unique in terms of their engineering and
marketing. Examples of the advertising of Swatch watches in South
Africa are attached to the founding affidavit. That material is clearly
directed at discerning, fashion conscious consumers. Apple’s descriptions
of its product range in the answering affidavit 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.

[14] Apple contended that the likelihood of confusion was considerably
diminished by the fact that over the past 15 years Apple has established a
family of i-prefix trade marks. The family is made up of the iPod, iPhone,
iPad, iTunes, and iCloud devices and services. Apple claimed that these
products and services have gained great popularity around the world, and

in South Africa, and that a consumer who encounters a new product from
Apple with the letter ‘i’ will recognise that the product and trade mark
form part of the Apple i-prefix family of trade marks and products.

[15] There is some controversy attaching to this contention. A family of
marks may assist the opponent in resisting the registration of a later mark
that might appear to be a member of the opponent’s family of marks. It is
less clear that the family resemblance of an applicant’s later mark, that is
sought to be registered, may be used to dispel the likelihood of confusion
with the opponent’s earlier registered mark. There is no need to resolve
this controversy in this case.  The conclusion that there is no likelihood of
confusion or deception is robust, without regard to the evidence that the
IWATCH would form part of a family of i-prefixed trade marks.

[16] Swatch contended that the goods covered by Apple’s class 14
application are identical to the goods covered by Swatch’s class 14
registered mark, and that Swatch’s class 14 goods are similar to many of
the goods covered by Apple’s class 9 trade mark application. Swatch
invoked the proposition that the greater the similarity of the goods
covered by the marks, the lesser will be the degree of resemblance
required as between the marks to show the likelihood of confusion or
deception. Swatch complained that the court below had disregarded this
consideration.

[17] Even on Swatch’s best case, that is, the identity of the goods in
class 14 referencing watches and clocks, in my view, on the analysis
undertaken above, the SWATCH and IWATCH marks are sufficiently

distinctive, given the likely consumers of the products, that it remains
unlikely that the marks will give rise to deception or confusion.

[18] For these reasons, the appeal cannot succeed. The following order
is made:
The appeal is dismissed with costs.

….
________________________
DAVID UNTERHALTER
ACTING JUDGE OF APPEAL

Appearances
For appellant:
Paola Cirone

Instructed by:
DM Kisch Inc. Sandton;

Phatshoane Henney, Bloemfontein
For respondent:
R Michau SC
Instructed by:
Bouwers Inc. Pretoria
Hill McHardy & Herbst ,Bloemfontein
THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
MEDIA SUMMARY OF JUDGMENT DELIVERED
Swatch AG (Swatch SA) v Apple Inc. (1320/2018) [2021] ZASCA 11

From:
The Registrar, Supreme Court of Appeal
Date:
29 January 2021
Status:
Immediate
The following summary is for the benefit of the media in the reporting of this case and does not form
part of the judgments of the Supreme Court of Appeal

Today the Supreme Court of Appeal SCA) handed down the judgment in an appeal against the
order of the Gauteng Division of the High Court, Pretoria, which dismissed the opposition to
the registration of a trade mark. The appeal was dismissed.

Apple applied to register its IWATCH trade mark. Swatch opposed these applications. Swatch
contended that the IWATCH and SWATCH marks are confusingly similar, and thus that the
IWATCH mark was likely to deceive or cause confusion. The high court dismissed the
opposition with cost. The central issue before the SCA was whether, upon a proper comparison,
the two marks are deceptively or confusingly similar.

The marks that required comparison were ‘SWATCH’ and ‘IWATCH. Swatch contended that
there were obvious similarities, as both marks consisted of only latters and they employ no
logos or other distinguishing matter; both have a common element of WATCH, preceded by a
single-letter prefix, one with an S and the other with an I, which does little to provide visual
differentiation. Furthermore, it was submitted that the marks sound similar when spoken and
that neither SWATCH nor IWATCH have any meaning when used in relation to watches.

In considering the question whether the marks are confusingly or deceptively similar, the court
considered the visual, aural and conceptual similarities of the marks; and the overall impression
given by the marks,  bearing in mind their distinctive and dominant components. The court also
considered how the marks were perceived by the average consumer, in the relevant market,
who is reasonably well-informed and observant.

As to the visual comparison of the marks, the court held that both marks make use of the
common element ‘watch’, which makes for some visual similarity. However the prefix ‘I’ in
IWATCH and ‘S’ in SWATCH provided visual differentiation.. As for the aural comparison,
the   marks sound very different. The conceptual reference to the word ‘watch’ was not a salient
point of identity. The word ‘watch’ is  a descriptive word. It is not the purpose of  the law of
trade marks  to secure a monopoly in respect of commonplace words. There is good reason to
avoid attaching exclusive rights to common descriptors.

In coming to its conclusion, the court considered that the consumers of the watches of Swatch
and Apple are likely to be more affluent and more concerned with the precise brand of watch
that they require. Consumers of this kind were found to be less likely to be deceived or confused
by the limited similarities between the marks.

The court held that  upon a visual, aural and conceptual comparison, the marks did not  yield
similarities of sufficient significance to make the marks confusingly or deceptively similar.

In the result, the appeal was dismissed with costs.

________________________________________