Breakfast at Costco
Back in 2016 we reported on the dispute between luxury jewellery retailer Tiffany & Co (Tiffany) and US wholesaler, Costco. The article can be read here.
The dispute, which arose in 2013, centered around Costco’s use of the word ‘Tiffany’ in its sale of diamond rings. Tiffany issued proceedings for trade mark infringement arguing that the labelling was misleading to customers while Costco argued that the term ‘Tiffany’ had become a generic term for rings.
The matter concluded in August 2017, with Costco being ordered to pay $19.4 million to Tiffany for unlawful use of the jewellery retailer’s trade marks. The amount ordered to be paid comprised of $11 million in compensatory damages and $8.25 million in punitive damages. Punitive damages are often awarded to the wronged party in US litigation in circumstances where the Defendant’s conduct has been particularly unreasonable.
Following the judgment, Costco attempted to reverse the decision or reduce the amount it was ordered to pay but has since been unsuccessful. District Judge Laura Swain maintained her position, and the position of the jury, reiterating that Costco’s use of the trade mark was improper. Costco’s unsuccessful attempt to reverse and reduce the judgment has meant it must now pay an additional $6 million in respect of Tiffany’s costs. In her judgment, Swain said that Costco had failed to show that the judgment amount had been incorrectly calculated; she explained that the damages were calculated based on the profit margins of an average jewellery store.
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