In a precedent-setting case, Switzerland’s highest court has ruled on a lawsuit between Rolex and watch customizer Artisans de Geneve. On January 19, the Swiss Federal Supreme Court ruled that AdG can personalize cheap Rolex super clone watches at the request and on behalf of the watch’s owner and only for their personal – not commercial – use. However, the Court also ruled that AdG cannot market or advertise modified products with another brand’s trademarks without consent, with limited exceptions.
Thus, the Court held that AdG’s current business model, in which clients provide 1:1 UK replica Rolex watches they already own to AdG to be customized, does not violate any laws. However, in light of its decision, the Court sent the issue of whether AdG’s marketing and advertising violate applicable laws back to the lower court for reconsideration.
It’s the first time the Swiss Supreme Court has considered this issue of personalization and customization, and it could have long-term effects on Rolex, AdG, and the watch industry (and other industries) more broadly, so let’s take a closer look.
First, Some Background
Rolex filed suit against AdG in December 2020 (note: the customizer’s name is redacted in the Swiss Court decision, but other details make us pretty certain it’s Artisans de Geneve). The story began before that, in February 2020, when Rolex secretly bought modified high quality Rolex Daytona super clone watches from AdG for CHF 32,580. This included AdG supplying the original Daytona and customizing it. The customization also included removing and reapplying the Rolex, Oyster, and Cosmograph marks on the dial, as well as the crown logo. Before filing the lawsuit, Rolex notified AdG that it had acquired the customized Daytona and of possible trademark infringement.
After Rolex’s notification, AdG changed its business model so that it did not stock customized watches for purchase on its website, which is how Rolex had purchased the Daytona. AdG shifted to its current model, where clients must provide personal best fake Rolex watches they already own to AdG for customization.
The Court also mentioned that accessing AdG’s website is now only possible after the visitor accepts a warning that the company is “an independent workshop offering watch personalization services at the request of customers for private use,” and that it does not manufacture or sell Swiss made Rolex super clone watches, nor is it associated with any brand. Further, after AdG personalizes the watch, it offers the customer a new guarantee, specifying that the original manufacturer’s warranty is void.
In February 2023, a lower court sided with Rolex, prohibiting AdG from using any of Rolex’s trademarks, including in advertising or in offering its customizations. AdG then appealed that decision.
“Rolex does not endorse any modification of its products by third parties – whoever they may be – outside its official network and approved service centers,” Rolex said in response to Hodinkee’s request for comment. “All operations performed outside of its control result in voiding all guarantees offered by the brand. Top Rolex copy watches modified in this way can, therefore, no longer be considered original, i.e., covered by the green Rolex seal. Once modified, such a watch can no longer receive the Rolex service delivered in the official network because it no longer meets the brand’s qualitative standards in terms of precision, water resistance, automatic winding, autonomy, resistance to magnetism, reliability, and durability.”
Artisans de Geneve has not responded to Hodinkee’s request for comment.
Two Separate Legal Issues
First, it’s important to remember that the purpose of a trademark is to distinguish a company’s products or services from those of others on the market. Infringement can happen when there’s a likelihood of consumer confusion, i.e., when you, the buyer, think you’re buying best quality super clone Rolex watches, but it’s actually from another company. According to the Swiss Supreme Court, the case presents two distinct legal issues:
Personalization at the request and on behalf of an object’s owner: This first type of activity occurs when a customer brings a watch to AdG, which AdG then customizes at the owner’s request for their own private use. The Court held that this activity is “lawful, to the extent that the service provider acts at the request of the object’s owner and where the customized item is returned to its owner” and not offered to the market.
The marketing, advertising, and offering for sale of customized products: This second type of activity involves the broader marketing, advertising, and offering for sale of customized watches for sale. The Court held that this type of activity is illegal unless authorization is granted by the owner of the brand (in this case, Rolex).
Before considering these two legal issues as they relate to AdG and Rolex, the Court first clarifies that “trademark exhaustion” exists under Swiss law, also sometimes referred to as the first sale doctrine. This basically means that once a trademark holder has sold an item, it can’t control what a buyer does with that product as long as it’s for their own personal use. As we’ll see, this becomes important because it implies that private use of a trademark is allowed. In other words, if a trademark is only being used to customize someone’s own Rolex replica watches wholesale, it’s not infringing on Rolex’s rights because it’s not being offered for sale, which might cause broader consumer confusion.
Deciding Rolex vs. Artisans de Geneve
Issue 1: Personalization On Behalf of an Owner
As noted, AdG changed its business model after Rolex notified it of potential infringement. According to the Court, activities under AdG’s previous business model violated applicable laws. That’s because it was advertising and offering for sale customized products on the market. But, under AdG’s newer business model, the client must provide a watch they already own, and it then personalizes the watch at the client’s request. No Swiss movements Rolex super clone watches are offered for sale to the general public. The Court held that this revised model does not violate applicable laws, saying that this is even the case if AdG’s customization involves removing and re-applying Rolex trademarks.
Here’s the Court’s reasoning.
When someone buys a watch, they can modify it however they want. In turn, nothing prevents the owner of a watch from instead having another company modify or customize their watch, as long as the customization is on behalf of the owner and only for their personal use, and not for commercial purposes. It’s an extension of the trademark exhaustion principle – once Rolex has sold a watch, it’s up to that individual what they do with their 2024 online Rolex fake watches, as long as it’s only for their personal use.
The Court says that this doesn’t undermine a trademark’s purpose of distinguishing products and services on the market since the products aren’t being offered commercially.
Issue 2: Advertising and Marketing
While the Court ruled that AdG’s current business model is thus lawful, it was not ready to say the same about the second issue related to AdG’s advertising and marketing.
According to the Court, if a third party wishes to market a branded product that has been modified, they must get approval from the trademark’s owner. For example, AdG would need Rolex’s approval to advertise 1:1 quality Rolex super clone watches it has customized for clients since this would be a commercial use of its trademarks.
However, this doesn’t completely prevent AdG’s use of Rolex trademarks. It can still use third-party marks for informative purposes, particularly in advertising, provided such use remains clearly linked to the advertised services.
But, such use can still become a violation if it gives a false impression that there’s a link between AdG and Rolex. In other words, AdG can’t do anything that might create potential consumer confusion or otherwise exploit Rolex’s reputation.
Sugar, We’re Going Down
While the Court held that AdG can customize Rolex replica watches site for personal use, it remanded this second issue regarding its advertising and marketing back to the lower court for further consideration in light of its decision. The lower court will have to look at AdG’s website and other advertising and marketing activities to decide whether or not they violate the parameters the court defined in its decision. The Supreme Court wrote that in its first decision, the lower court did not properly evaluate AdG’s use of Rolex trademarks on its website and whether or not they clearly related to AdG’s own service offerings. Further, it did not examine how Rolex, being a “highly renowned brand,” impacts the assessment of AdG’s activities.
Wait, What’s a ‘Highly Renowned Brand?’
This isn’t the main issue in the lawsuit, but the Supreme Court specifically noted that Rolex is an owner of a “highly renowned brand,” giving it certain special protections that you don’t get if you’re just any trademark holder. For example, brands with a “high reputation” might prevent the use of their marks in any other products, services, or even advertising, even if the products or services aren’t competitive; e.g., a third party can’t use Coca-Cola to sell bed sheets or Nike to sell perfume (both actual cases).
It’s an interesting note—and congrats to Rolex—but it also has legal implications. The Supreme Court says the lower court will have to consider how Swiss super clone Rolex watches‘ status as a “highly renowned brand” affects its legal decision when taking up the issue of AdG’s advertising again.
The Big Question: Who Can Personalize?
While the lawsuit is between Rolex and AdG, the Swiss Supreme Court says that it has never ruled on the issues of customization for personal use raised by this case. But it’s an important issue, not just in the watch industry.
“The growing importance of personalization of branded items is also reflected in the emergence of new conflicts dividing brand owners from companies modifying goods bearing the original brand of third parties,” the Court writes.
This brings us back to Rolex and AdG. If you head to Rolex’s website, you’ll already be given the option to “configure” a watch. For example, head to the Datejust page, and you’re not given a catalog of product offerings. Instead, you’re asked to configure your own China Rolex Datejust super clone watches. You start by choosing the size (31, 36, or 41mm), then the metal, bezel, bracelet, and dial. For the Datejust, this quickly adds up to hundreds of options. While you and I might know this is just a different way of presenting Rolex’s static SKUs to an average consumer, it can start to feel like something different: personalization. It’s easy to imagine a future in which Rolex offers true personalization, the type of thing AdG provides to its clients. In fact, head over to your local Rolex AD, and they already have real customization options, such as day or date wheels in different languages.
If this is the direction Rolex is headed, AdG’s personalization business starts to feel even more competitive. And we’ve seen Rolex use lawsuits to shut down customizers before. A few years ago, it successfully stopped American company Le Californienne from customizing and re-selling brightly colored vintage Datejusts and Day-Date dials. That lawsuit may have even hinted at Rolex’s product roadmap, as just a couple of years after that case, it released its brightly-colored Oyster Perpetual dials.
As the Swiss Supreme Court notes, personalization is increasingly important to consumers, which Rolex super clone watches store seems to recognize, too.
Meanwhile, AdG is trying to walk a thin line. While the Supreme Court has said its core customization business is legal, it must be extremely cautious in how it markets and advertises its customization services, only using Rolex marks for informational purposes or in ways linked to AdG’s services. On AdG’s social media, you’ll see its posts emphasize the “unique craftsmanship” and techniques that go into each customization. Each post is accompanied by an anguished legal disclaimer explaining that AdG is in the business of carrying out work “at the sole request of our customers…and for their private use only.”
The Court’s ruling affirms and clarifies something that probably feels intuitive to watch enthusiasts: You can do whatever you want with your own watch, as long as it remains for your personal use. You can even hire a third party to do this customization or modding.
After all, there’s a long history of customizing, modding, and bussing-down replica Rolex watches shop. It’s personal and fun, and no brand should be able to control that. At the same time, brands have some legitimate interest in protecting their brand name. Balancing these two interests is tricky, and while the fight is between Rolex and AdG for now, it has big implications for the future of watches.
