Costco sold counterfeit Tiffany engagement rings: U.S. judge

Tue Sep 8, 2015 4:44pm EDT
 
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By Nate Raymond

NEW YORK (Reuters) - Costco Wholesale Corp willfully infringed Tiffany & Co's trademarks by selling counterfeit diamond engagement rings bearing the luxury retailer's name and must face a jury trial to assess damages, a U.S. judge ruled on Tuesday.

U.S. District Judge Laura Taylor Swain in Manhattan rejected claims by Costco that Tiffany's trademarks were invalid because they sought to prevent others from using the word "Tiffany" as a generic description of a type of ring setting.

Instead, Swain said evidence established that Costco, the largest U.S. warehouse club chain, had infringed Tiffany's trademarks by selling engagement rings and confused consumers by using the word Tiffany in display case signs.

"Despite Costco's arguments to the contrary, the court finds that, based on the record evidence, no rational finder of fact could conclude that Costco acted in good faith in adopting the Tiffany mark," Swain wrote.

Under the ruling, Tiffany may now take Costco before a jury to seek damages, including a recovery of Costco's profits from the sale of the diamond rings and punitive damages.

Swain set a hearing for Oct. 30 and directed Tiffany and Costco to "make good faith efforts to settle the outstanding issues."

In a statement, Tiffany General Counsel Leigh Harlan welcomed the ruling, saying it "further validates the strength and value of the Tiffany mark and reinforces our continuing efforts to protect the brand."

Representatives for Costco did not respond to requests for comment.   Continued...

 
Shopping carts at Costco in Fairfax, Virginia, January 7, 2010.   REUTERS/Larry Downing