Turmoil for Tiffany on Valentine's
On Valentine's Day, Tiffany and Company gifted not diamonds and roses, but a lawsuit to discount giant Costco.
Yesterday, represented by Dickstein lit partner Jeff Mitchell, Tiffany filed suit in t he SDNY to stop Costco from s elling counterfeit Tiffany rings. This morning, Jeff told us the suit seeks damages of three times Costco's profits from the rings and statutory damages of $2 million per infringement. Claims include trademark infringement, counterfeiting, dilution, and false and deceptive business practices. It all started in November when an indignant customer in California alerted Tiffany that engagement rings promoted as "Tiffany" were on sale. (Hint: they were not Tiffany.) Jeff, who's had Tiffany as a client since the '90s, originally reached out to the wholesaler in December. Costco confirmed that the rings were sold in more than the one store and said that it would remove references to Tiffany from signage.
We've seen Nike logos slapped on pairs of brass knuckles and fake Lexus airbags, but it's unusual for a massive retailer like Costco to engage in those practices. Since shoppers at Costco do expect "brand name merchandise at discount prices," says Jeff, "customers might be more easily taken in." It's resulted in hundreds if not thousands of shoppers snapping up the fake Tiffany engagement rings, and Tiffany had to "take action to protect its marks, its goodwill, and its trade name."
