Costco is known for being a “good guy” in a sea of predatory corporations. They pay their employees an incredibly fair (and living) wage, which makes it a real gem to find when you’re hunting for a job.
Maybe gem is the wrong word, though, considering that Costco was just ordered to pay Tiffany & Co. $19 million for selling $3.7 million worth of diamond rings falsely identified under the “Tiffany” brand.
According to U.S. District Judge of the Southern District of New York Laura Taylor Swain, Costco “displayed at best a cavalier attitude toward Costco’s use of the Tiffany name in conjunction with ring sales and marketing.”
Costco attempted to claim that the word “Tiffany” referred to a ring’s setting and was a generic term.
The judge’s decision, which followed a 2015 verdict that found Costco had made $3.7 million from their use of Tiffany’s brand name, was that Costco should pay Tiffany $11.1 million, plus interest, as a combination of Tiffany’s lost profit and $8.25 million in punitive damages. The company isn’t allowed to use the word “Tiffany” to describe any products that aren’t connected to the official brand, either.
Costco plans to appeal, saying in a statement, “This was not a case about counterfeiting in the common understanding of that word — Costco was not selling imitation Tiffany & Co. rings.” The company claims that the rings weren’t stamped or marked with the brand name, but with the name of the company that made them.” Apparently of the 2,500 people who purchased the rings, only 10 misunderstood and believed they were actually purchasing Tiffany rings at Costco.
What Do You Think?
Do you think Tiffany & Co. was justified in bringing suit against Costco, and do you think the judge’s ruling was fair to both companies?