Defensive Licensing in Luxury Law:The Audemars Piguet x Swatch Royal Pop and the Limits of Trade Dress Protection

Abstract

The May 2026 launch of the Audemars Piguet × Swatch “Royal Pop” presents a legally significant question that extends beyond luxury branding: can a controlled mass-market collaboration generate sufficient evidence of acquired distinctiveness to support future trade dress protection of the Royal Oak’s three-dimensional configuration? This article examines that question against the backdrop of two adverse rulings — the United States Trademark Trial and Appeal Board’s precedential refusal in January 2025 and Japan’s Intellectual Property High Court decision in 2024 — both rejecting AP’s applications to register the Royal Oak’s configuration as a trademark. Analysing the Lanham Act’s secondary meaning doctrine, the functionality bar, and comparative case law, this article argues that while the Royal Pop may function as a form of defensive licensing at scale, structural doctrinal obstacles and evidentiary gaps remain, and the collaboration alone cannot substitute for the rigorous consumer survey programme that any future trademark application will require.

Keywords: Trade Dress Protection, Acquired Distinctiveness, Defensive Licensing, Secondary Meaning, Trademark Law, Luxury Brand Protection, Fashion Law, Intellectual Property

1. Introduction

A few weeks ago, the launch of the Audemars Piguet × Swatch “Royal Pop” created unusual public attention in the watch and luxury market. Hundreds queued outside Swatch stores across three continents to purchase a $400 pocket watch carrying design elements clearly associated with Audemars Piguet’s Royal Oak — a brand whose cheapest wristwatch costs $30,000. The demand was immediate: the product sold out quickly in many locations, and by noon on launch day, that same watch was being resold on eBay for as much as $6,500. The event was widely discussed across the watch community and described as the “Apocalypse.”

At first glance, the collaboration looks like another example of luxury hype meeting mass-market branding. From a legal standpoint, though, it raises a more interesting question. Why would Audemars Piguet — an independent and highly exclusive watch manufacturer that sits, alongside Patek Philippe and Vacheron Constantin, within what the industry calls the Holy Trinity of haute horlogerie — allow the design language of its most valuable watch, the Royal Oak, to appear on a comparatively affordable Swatch release? The Royal Oak generates over ninety percent of AP’s annual revenue, making it one of the most commercially dependent single-design products in modern watchmaking.

The answer begins in January 2025, when the United States Trademark Trial and Appeal Board affirmed the refusal of Audemars Piguet’s applications (Serial Nos. 90045780 and 90045814) to register the Royal Oak’s 3D configuration as a trademark. The Board and Japan’s Intellectual Property High Court both found the overall configuration functional and lacking in acquired distinctiveness, illustrating that even iconic designs may not qualify as standalone trademarks in major jurisdictions.

What followed was not litigation but the release of the Audemars Piguet × Swatch Royal Pop, a bioceramic pocket watch carrying recognisable Royal Oak design features and distributed globally through two hundred Swatch boutiques at a significantly lower price point. Crucially, this collaboration differs from the MoonSwatch collaboration between Omega and Swatch in 2022, which took place entirely within the Swatch Group. Audemars Piguet is an independent, family-owned manufacture, so this cannot be read as an internal brand extension — it is a cross-company exercise with real legal consequences.This article examines the feasibility of the Royal Pop collaboration in producing sufficient evidence of acquired distinctiveness to substantiate future trade dress protection for the Royal Oak configuration. It argues that the collaboration may serve as a defensive licensing mechanism by enhancing consumer association and market presence; however, it also poses a risk of diluting the exclusivity of the design, resulting in a legally ambiguous but strategically significant position under trademark law.

The analysis draws on the Lanham Act, the TTAB’s rationale, and comparative case law, including Wal-Mart Stores v. Samara Brothers, Christian Louboutin S.A. v. Yves Saint Laurent America, and Audemars Piguet v. Swiss Watch International.

2. Background

To understand the legal implications of this collaboration, it is necessary to examine the doctrinal framework governing trademark protection for product design, alongside the historical and commercial significance of the Royal Oak itself.

A trademark is a word, name, symbol, device, or combination used to identify and distinguish the goods or services of one enterprise from those of others.¹ The Lanham Act also protects trade dress² — the overall commercial image of a product, including its design, configuration, or visual appearance — where that dress is distinctive and identifies a single source.³ The product configuration must be non-functional and must have acquired secondary meaning: consumers must associate the configuration itself with a particular source.

Acquired distinctiveness is established through evidence such as consumer surveys, advertising expenditure, length and exclusivity of use, and unsolicited media attention. Product designs are not inherently distinctive and can be protected only upon proof of secondary meaning, as the U.S. Supreme Court confirmed in Wal-Mart Stores, Inc. v. Samara Brothers, Inc.⁴

This framework is central to Audemars Piguet’s position. Audemars Piguet (“AP“) was founded in 1875 in Le Brassus, a small village north of Geneva, Switzerland, in the Vallée de Joux — known as the cradle of haute horlogerie. The company built its reputation on horological craftsmanship and highly complicated watchmaking. Its most commercially significant design, the Royal Oak, was created in 1972 by Gérald Genta as a luxury sports watch in stainless steel. Inspired by a ship’s porthole, the design features an octagonal bezel secured by eight hexagonal screws, a Petite Tapisserie guilloché dial, an integrated bracelet, and a 39mm steel case.

Although AP secured a United States design patent for the Royal Oak⁵ in 1972, that protection has since expired, leaving the brand dependent on trademark and trade dress law to protect its visual identity.

The Royal Pop must be understood against this background. Released in May 2026 through the collaboration between AP and Swatch AG, it is a 40mm bioceramic pocket watch featuring sapphire crystals and Swatch’s SISTEM51 movement, with a 90-hour power reserve. While the pocket watch incorporates recognisable Royal Oak design features, its movement departs from traditional AP horology: because the SISTEM51 is entirely machine-assembled and sealed, it is not conventionally serviceable and must be replaced as a complete unit if it fails.

It is not, however, a direct substitute for the Royal Oak wristwatch. It is instead a descendant of an earlier and less prominent Royal Oak pocket-watch lineage, including Reference 5691 (the first Royal Oak pocket watch, 1979) and Reference 5697 (1990s), which situates the product within a distinct category. The Royal Pop also draws on Swatch’s Pop line (1986–1995), known for its modular, wear-anywhere design. From a legal perspective, the significance of the Royal Pop lies not in its commercial accessibility but in its controlled use of Royal Oak design elements within a broader market.

This approach can be understood as a form of defensive licensing. While more commonly associated with patent law, similar strategies appear in trademark practice — particularly in luxury industries, where brands may authorise limited use of their design language to reinforce consumer association, occupy market space, and pre-empt unauthorised imitation.

The Royal Pop collaboration aims to bolster the evidence for acquired distinctiveness in AP’s product design, but it also risks either strengthening AP’s brand association or diluting its exclusivity by making the design seem more generic.

3. Legal Analysis

For years, AP pursued a strategy to register the Royal Oak’s 3D configuration — an octagonal bezel, eight hexagonal screws, a Tapisserie dial pattern, case, and bracelet — as a trademark across key global markets. This strategy rests on a fundamental distinction in intellectual property law: design patent protection is time-limited, while trademark protection can, in principle, endure indefinitely. With the expiry of Genta’s Royal Oak design patent⁶, AP sought to transition from finite patent protection to perpetual trademark rights over the Royal Oak’s design language. Courts refused to permit this conversion.

In July 2020, AP filed two applications with the USPTO⁷ (Serial Nos. 90045780 and 90045814) seeking to register the Royal Oak’s 3D configuration covering the watch face, bezel, casing, and bracelet. The USPTO refused in January 2024, calling the elements “nondistinctive” and “commonly used within the watch industry.” Rather than revise the applications to isolate the elements most likely to qualify, AP appealed the full applications to the Trademark Trial and Appeal Board (TTAB).

On January 2, 2025, the TTAB upheld the refusal in a precedential decision.⁸ The Board’s reasoning rested on two main grounds.

First, some Royal Oak elements were found functional under the Inwood test⁹, which treats a product feature as functional if it is essential to the product’s use or purpose; functional features¹⁰ are categorically excluded from trademark protection. The Board specifically noted that common design elements within the watch industry — such as a circular time display — cannot be monopolised. Functional features cannot receive trademark protection regardless of cultural distinctiveness.

Second, and more significant for this analysis, a product design can only be registered as a trademark if consumers recognise it as a source indicator, not merely as an attractive or functional feature. The TTAB found the Royal Oak’s elements functional and inherently non-distinctive. Most critically, the Board observed that AP’s marketing consistently displayed prominent word marks — “AP” and “Audemars Piguet” — alongside the design, weakening the claim that the configuration functioned as an independent source identifier. The evidentiary record, including survey material, did not establish consumer association with the configuration as a whole.

This refusal highlights a fundamental limitation of product configuration marks: even where individual elements are recognisable, trademark protection may be denied if distinctiveness cannot be demonstrated across the claimed configuration in its entirety. In trademark law this is fatal — if consumers recognise the brand because of the name next to the shape, rather than the shape itself, the shape has not functioned as a standalone source indicator.

The USPTO’s own Trademark Manual of Examining Procedure subsequently reflected the significance of the ruling. Japan’s IP High Court reached the same conclusion in 2024. In both jurisdictions, AP failed to submit consumer survey evidence, a critical gap both courts explicitly highlighted.

It is against this background that the Royal Pop must be understood. The deficiency the TTAB identified was specific: the absence of consumer association between the Royal Oak’s configuration and AP, independent of word marks. The strategic response appears equally specific — generating that association at scale through authorised products in the market. Each instance in which consumers or media recognise the octagonal configuration as indicative of Audemars Piguet contributes to the type of “look-for” evidence the Board found lacking.

The timeline of the Royal Pop collaboration supports this reading. Swatch AG filed for protection of “Royal Pop” in Switzerland in January 2024 and secured registration through the Madrid system later that year, ahead of the adverse rulings. This suggests the collaboration was not merely reactive, but anticipatory of legal difficulty.

The success of this strategy is not assured, however. Wider dissemination of the design could enhance consumer recognition but could also erode exclusivity. And the continued use of co-branding — “AP × Swatch” on the dial — raises the same evidentiary issue the TTAB identified: whether the design itself, separate from textual branding, can function as a source identifier.

4. Case Law

4.1 Wal-Mart Stores, Inc. v. Samara Brothers, Inc.¹¹

In Wal-Mart v. Samara Brothers, the U.S. Supreme Court held that product design is inherently non-distinctive and can be protected as a trademark only on a showing of acquired secondary meaning. The Court distinguished product design from product packaging, explaining that consumers do not usually treat design features as source identifiers absent long-term exposure — a position grounded in competition policy, since granting exclusive rights over product design too readily would impede legitimate competition. The decision supports the TTAB’s approach doctrinally and points to the structural problem facing Audemars Piguet: commercial success and cultural recognition cannot substitute for evidence of acquired distinctiveness.

4.2 Christian Louboutin S.A. v. Yves Saint Laurent America¹²

The Second Circuit’s decision in Christian Louboutin offers a positive example of the evidentiary standard successful trade dress claims must meet. The court found the red lacquered outsole of Louboutin footwear to be a valid trademark, having acquired distinctiveness through consistent use, targeted marketing, and widespread media recognition. Importantly, the red sole served as a stand-alone source identifier, often recognised independently of the brand name — in stark contrast to Audemars Piguet’s position. While Louboutin’s strategy isolated and reinforced a single visual element, AP’s marketing consistently paired the Royal Oak design with its word marks, constraining the configuration’s ability to function independently as a trademark.

4.3 Audemars Piguet Holding SA v. Swiss Watch International, Inc.¹³

In Audemars Piguet v. Swiss Watch International, the Southern District of New York granted a permanent injunction against a manufacturer of a Royal Oak-inspired watch, finding trade dress infringement and secondary meaning evidence. The ruling confirms that Royal Oak design protection is available against direct imitation even absent a registered configuration mark. It also highlights an important limitation: such protection relies on case-specific proof of consumer confusion. As similar designs multiply in the marketplace, demonstrating confusion becomes harder — which underscores the importance of the TTAB’s refusal and the void the Royal Pop strategy aims to fill.

5. Critical Analysis / Findings

The Royal Oak’s origin story carries a deep legal irony. The watch was initially criticised as unconventional and took three years to sell its first 2,000 units; critics called it too industrial, too expensive, and commercially risky. Yet it became so globally ubiquitous that it eventually inspired an entire visual category.

Brands adopted the octagonal sports-watch aesthetic as it spread across the industry. Casio has produced watches with octagonal bezels for decades, and countless other manufacturers followed the same aesthetic. These are not counterfeits and not passing-off — but they are precisely the evidence courts point to when ruling that an octagonal bezel is not inherently distinctive of a single brand.

In strict trademark doctrine, “genericide” describes a brand name becoming so widely used that it loses protection by going generic — think “escalator” or “aspirin.” This is not genericide in the precise sense, but the underlying logic is comparable: the Royal Oak became so widely recognised and imitated that its design could no longer be treated as uniquely identifying Audemars Piguet. Its iconicity made it legally unregistrable. The very global saturation that makes the Royal Oak worth billions is what made it impossible to trademark as a 3D mark — its success, ironically, became a liability in trademark law.

This matters because the Royal Oak generates most of AP’s revenue, leaving the brand heavily reliant on a single design. With design patent protection expired and 3D trademark applications rejected, the design is now more vulnerable than ever. In this context, the Royal Pop is a strategic response rather than a typical collaboration.

The Royal Pop can be viewed as a form of defensive licensing at scale. Incorporating Royal Oak design elements into a mass-market product distributed in a controlled way can be read as an attempt to create the type of evidence that was previously unavailable — evidence that the design is recognised by the general public. Whenever the octagonal design is recognised by the public or media as associated with Audemars Piguet, it serves as “look-for” evidence supporting acquired distinctiveness, similar to the Royal Oak Refs. 5691 and 5697 pocket watches, broadening the Royal Oak collection while preserving the wristwatch’s exclusivity.

The effectiveness of this strategy remains uncertain. The continued presence of co-branding — “AP × Swatch” on the dial — risks reinforcing consumer association with the combined identity rather than with AP alone. As Christian Louboutin illustrates, a successful product-design trademark requires the visual element to function independently of textual branding, and the current execution does not fully achieve that separation.

Greater consumer association may not, in any case, be enough for courts to view the Royal Oak configuration as a mark rather than part of a common design language. The absence of convincing consumer survey evidence remains a significant gap. The Royal Pop may create favourable market conditions, but it cannot substitute for empirical evidence. Any future attempt at trademark protection will hinge on establishing, through independent survey evidence, that consumers see the design as a source identifier in its own right.

6. Conclusion

The Royal Oak’s path is an intriguing paradox in trademark law. A design once criticised at its inception became so widely recognised that, decades later, it was denied trademark protection on the very grounds of its ubiquity. In this sense, the Royal Oak’s commercial success ultimately weakened its legal claim to exclusivity.

The Royal Pop collaboration represents Audemars Piguet’s attempt to respond to this limitation by reframing the problem — aiming to increase consumer association with the design rather than relying solely on exclusionary rights. The brand appears to be bringing the Royal Oak’s visual language into a controlled, large-scale market environment to generate the evidence needed to prove acquired distinctiveness.

Whether this strategy succeeds remains to be seen. The continued use of co-branding, together with courts’ broader reluctance to grant monopolies over widely adopted design features, suggests considerable legal hurdles remain. Ultimately, the Royal Pop sits at the crossroads of evidentiary strategy and possible dilution — a legally ambiguous but strategically significant development in the changing terrain of luxury trade dress protection.

Author’s Note

As a student working at the intersection of intellectual property and fashion law, this study reflects a broader academic interest in how luxury brands adapt their legal strategies beyond traditional enforcement. The Royal Pop collaboration, in particular, highlights a shift from litigation-driven protection to market-based evidentiary strategies.

This raises an important question for future inquiry: whether defensive licensing can function as a sustainable long-term mechanism for protecting design-led brands where courts remain reluctant to grant product-configuration trademark protection. At the same time, it invites consideration of the risks inherent in such strategies, especially where wider accessibility may affect the exclusivity that underpins luxury brand value.

These tensions between legal protection, market strategy, and brand identity continue to shape the evolving landscape of fashion and luxury law, making this area of study both complex and increasingly significant.

Reference(S):

• In re Audemars Piguet Holding SA, Serial Nos. 90045780 & 90045814 (T.T.A.B. Jan. 2, 2025).
• Wal-Mart Stores, Inc. v. Samara Bros., Inc., 529 U.S. 205 (2000).
• Christian Louboutin S.A. v. Yves Saint Laurent Am. Holdings, Inc., 696 F.3d 206 (2d Cir. 2012).
• Inwood Labs., Inc. v. Ives Labs., Inc., 456 U.S. 844 (1982).
• Audemars Piguet Holding SA v. Swiss Watch Int’l, Inc., No. 12-cv-9224 (S.D.N.Y. 2014).
• Lanham Act, 15 U.S.C. (1946).
• Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), Apr. 15, 1994.
• Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks, June 27, 1989.
• Susan Scafidi, Intellectual Property and Fashion Design, 1 Intell. Prop. & Info. Wealth 115 (2007).
• William Cornish et al., Intellectual Property: Patents, Copyright, Trade Marks and Allied Rights (9th ed. 2019).
• World Intellectual Property Organization, Intellectual Property and the Fashion Industry, WIPO Publication No. 947E (2014).
• World Intellectual Property Organization, Understanding Trademarks, WIPO, https://www.wipo.int (last visited June 8, 2026).
• Audemars Piguet, Royal Pop Collaboration, https://www.audemarspiguet.com/com/en/news/origins/swatch-royal-pop.html (last visited June 8, 2026).
• Shawn Setaro, Is AP Releasing a Swatch Collaboration After Trademark Loss?, Complex, https://www.complex.com/style/a/shawn-setaro/is-ap-releasing-swatch-collab-lost-trademark-battle (last visited June 8, 2026).

Note(S):

1. 15 U.S.C. § 1127 (2024).
2. Lanham Act, 15 U.S.C. §§ 1051–1141 (2018).
3. Lanham Act § 43(a), 15 U.S.C. § 1125(a) (2024).
4. Wal-Mart Stores, Inc. v. Samara Brothers, Inc., 529 U.S. 205 (2000).
5. U.S. Patent No. D233,257 (filed Oct. 30, 1972).
6. Watch Case, U.S. Patent No. 3,756,017 (issued Sept. 4, 1973) (invented by Gérald Genta).
7. U.S. Patent & Trademark Office.
8. In re Audemars Piguet Holding SA, Serial Nos. 90045780 & 90045814 [citation to be completed — verify reporter number before publication] (T.T.A.B. Jan. 2, 2025).
9. Inwood Laboratories v. Ives Laboratories, 456 U.S. 844 (1982).
10. Lanham Act § 2(e)(5), 15 U.S.C. § 1052(e)(5) (2024).
11. Wal-Mart Stores, Inc. v. Samara Brothers, Inc., 529 U.S. 205 (2000).
12. Christian Louboutin S.A. v. Yves Saint Laurent Am. Holdings, Inc., 696 F.3d 206 (2d Cir. 2012).
13. Audemars Piguet Holding SA v. Swiss Watch Int’l, Inc., No. 12-cv-9224 [citation to be completed — verify reporter number before publication] (S.D.N.Y. 2014).