Costco sued for $19m for selling ‘fake’ Tiffany rings
American wholesaler Costco has been ordered to pay $19m (£15m) in damages for selling Tiffany-labelled engagement rings.
The reportedly made store made $37m (£28m) selling roughly 2,500 diamond rings, labelled as ‘Tiffany’ rings on store signs.
The legal battle between the two companies began in 2013, with Costco arguing that ‘Tiffany’ was now a generic term for the style of jewellery.
On Monday (14 August) it was ruled that the company infringed on Tiffany’s trademark and it was ordered to now refer to the rings as ‘Tiffany-style’.
In October 2016, Costco was ordered to pay $5.5m in compensatory damages and $8.25m in punitive damages.However, the compensation was increased to $11m at the ruling on Monday with the punitive damage amount remaining the same.
Tiffany said in a statement to CNN the ruling “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. It is critically important that the Tiffany name not be used to sell any engagement ring that is not our own.”
Costco has said that it would appeal the ruling, stating that “multiple errors” had been made on the judge’s part. It said: “This was not a case about counterfeiting in the common understanding of that word – Costco was not selling imitation Tiffany & Co rings.”
The company added that the diamond rings in question “were not stamped or otherwise marked with the Tiffany & Co. name (but rather were stamped with the name of the company that manufactured them); they were accompanied by appraisal documents that did not mention Tiffany & Co., and with sales receipts that did not say Tiffany or Tiffany & Co. notably.”
It continued: “Tiffany & Co. did not claim in the lawsuit that it lost a single sale to Costco as a result of any sign. From a purchaser list of approximately 2,500, Tiffany identified fewer than 10 who said they had misunderstood Costco’s signage.”
