Costco forced to pay Tiffany over $19M in trademark lawsuit

In 2013, Tiffany & Co. sued Costco Wholesale Corp for selling rings in Costco stores and labelling them as “Tiffany” without differentiating terms, such as “style,” “set,” or “setting.” Despite Costco’s countersuit claiming that “Tiffany” was a generic term used to describe a ring style, Judge Laura Taylor Swain dismissed Costco’s case. Following the dismissal, the jury awarded Tiffany with $3.7 million, a sum that later increased by $8.25 million for punitive damages.

Last week, Swain increased Costco’s owing’s to $11.1 million for Tiffany’s loss in profits dating back to 2013, a sum that now reaches well over $19 million in total.

Following the ruling, Tiffany commented: “Judge Swain’s decision validates the strength of the Tiffany trademark and the value of our brand, and most importantly, sends a clear and powerful message to Costco and others who infringe the Tiffany mark.”

“We brought this case because we felt a responsibility to protect the value of our customers’ purchases and to ensure that Costco’s customers were not mislead about their purchases. It is critically important that the Tiffany name not be used to sell any engagement ring that is not our own,” added Tiffany.

As for Costco, they intend to appeal Swain’s decision. In a statement on the ruling, Craig Jelinek, Costco’s President and CEO, said: “Our mission statement mandates first that we obey the law and second that we take care of our members. Over 90 percent of our members in the U.S., who pay to shop with us, renew their memberships every year. We work very hard to maintain their trust, and we strive to be candid with them. These efforts will continue whatever the final outcome of this lawsuit may be.”

Although Costco suggests that the judge’s decision is “a product of multiple errors in pretrial, trail, and post-trail rulings,” Swain also ruled that the wholesale corporation can no longer use “Tiffany” in their advertising of non-Tiffany & Co. products.

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