By Allen Farmelo
This article originally appeared in print during 2019 in International Watch Magazine.
Intellectual Property, Sampling & Upcycling
In the music industry, when one artist samples part of another artist’s recording and makes something new with it, the intellectual property questions are typically gray, sometimes leading to legal battles. When Singer Vehicle Design modifies, improves, and co-brands Porsche 911s, Singer likely flirts with a legal suit from the storied German car maker. When the small San Francisco store Park Life began selling small balloon-animal dog models, artist Jeff Koons, who made himself famous by making large scale sculptures of said balloon dogs, issued a cease-and-desist letter, effectively claiming copyright over balloons twisted up to look like wiener dogs.
Something similar is now happening in the watch world as Hamilton, owned by Swatch Group, has sued Colorado’s Vortic Watches in US Federal Court for both trademark infringement and counterfeiting. Hamilton is suing Vortic because the latter has been restoring scrapped Hamilton pocket watch movements and dials and setting them into newly fashioned wrist watch cases, and some of those dials say "Hamilton" on them.
Vortic is claiming that their practice is “upcycling.” Sometimes called “creative reuse,” upcycling aims to take waste products and refashion them into useful things. Typically claiming a positive environmental impact, examples of upcycling include everything from refashioning old Coke-a-Cola bottles into lamps to re-purposing food waste as bio-fuels. Set into the broader context of the upcycling movement, Vortic’s use of Hamilton (and other brand’s) movements and dials can seem like a noble and fair pursuit, perhaps even one that honors and promotes those brands.
Hamilton, on the other hand, sees Vortic’s use of Hamilton movements and dials as an infringement on their intellectual property. For Hamilton to prevail in these ongoing law suits, they will need to establish that Vortic’s re-purposing of the older Hamilton components constitutes trademark and/or counterfeit breaches as described in the relevant US Federal Laws on intellectual property—which, perhaps unsurprisingly, differ from those set out in the Swiss legal system.
In the digital era, Vortic’s use of antique mechanical movements and dials hardly resembles the kinds of IP questions making news these days. However, Hamilton International Ltd. v Vortic LLC might turn out to be quite relevant in the digital age because as we digitize our lives at such a rapid pace, older analog technologies are taking on newfound significance, desirability, and market value. The recent upswing in the popularity of both vintage and new mechanical watches is just one example, with everything from old-school board games to pens, paper, film cameras, and physical books seeing huge swells in popularity over the past few years. Accordingly, many heritage brands are seeing pronounced growth.
Heritage is Valuable
It is here that we might glimpse how Hamilton and Vortic are tugging on the same rope, as both companies are relying on the appeal of Hamilton as a heritage brand. Operated in Lancaster, Pennsylvania from 1892 until consolidating all manufacturing to their Swiss plant in 1969, Hamilton has been banking on their American heritage and identity for decades. Today the Swiss-owned and operated company issues mid-20th Century inspired models like the Intra-Matic, the ubiquitous Khaki Field watch, the Railroad, and—there’s no mistaking the American-ness of this one—The Spirit of Liberty. As one considers the abundant American associations of the current Hamilton catalog, it is easy to see that—despite being entirely a Swiss company for nearly half a century—Hamilton is deeply reliant on that American heritage.
It is here that we might glimpse how Hamilton and Vortic are tugging on the same rope, as both companies are relying on the appeal of Hamilton as a heritage brand.
But Hamilton’s reliance on the American heritage of the brand is not a conclusive argument that Vortic Watches is in the wrong here. Much of what matters is whether the US Federal judge overseeing the case decides whether Vortic is in any way misleading their customers. As one starts to investigate the relevant US legal precedents, we wind up on a sinuous path that digs up Rolex Watch, U.S.A., Inc. v. Michel Co, in which Rolex sued for trademark counterfeit based on Michel Co. having refurbished older Rolex watches using unmarked non-Rolex parts. This was a minor win for Rolex in which the judge demanded that the non-Rolex parts be marked as such, and that receipts indicate that non-Rolex parts were used, so as not to confuse customers. That case was a significant reference in another case that seems to be highly relevant to Hamilton International Ltd. v Vortic LLC—a case involving golf balls.
Much of what matters is whether the US Federal judge overseeing the case decides whether Vortic is in any way misleading their customers.
Relevant: Upcycled Golf Balls
In the 2003 case of Nitro Leisure Products v. Acushnet Company, Acushnet sued Nitro for selling used and refurbished golf balls from Acushnet’s various brands, including Titlist and Pinnacle. Significantly, both the used and refurbished balls carried the original trademarks. The judge ruled that, as long as it was clear to consumers that these were either used and/or refurbished balls, selling them with the original trademark was fair game because the used and refurbished balls are, effectively, a different product. The parallels with Hamilton International Ltd. v Vortic LLC seem clear enough: Vortic simply makes it absolutely clear to consumers that the watches they are selling contain refurbished used movements and dials, and all is good.
However, intellectual property is far more nuanced and confusing than that one precedent suggests. Lawyers on both sides will surely cite multiple precedents simultaneously, and judges often withhold decisive perspectives until announcing their ruling. As such, it remains impossible to predict the results of Hamilton International Ltd. v Vortic LLC, let alone the potential for this case to become a significant precedent in future battles over the intellectual property involved in upcycling.
An update since the original pulication: The case has been heard, but the judge has yet to issue a final judgement.
A note on publishing history of this article: I had pitched the story to many publications, and only International Watch was willing to go to print with it. The rejections I received came in the form of rather frank explanations that Swatch Group, which owns Hamilton, was too close to ad revenue sources. I didn't see the problem, as long as one provides a balanced report that doesn't take sides. For full disclosure, this story came to me through a conversation at Worn & Wound's WindUp event in NYC with the folks at Vortic, but I quickly cut off conversations with them and instead began research and pitching.