Tiffany & Co. vs. Costco
We’ve talked a lot about brands collaborating recently and what a tremendous benefit a retailer like Nieman Marcus can see by running a lower end line in partnership with Target, and how Target benefits from the brand name boost. But imagine if Target ran a clothing line called “Nieman Marcus,” but the upscale retailer had no idea their name was being used. Could Target say it was just inspired by the brand, or that they meant it as a generic term?
Tiffany & Co. filed a lawsuit against Costco in the U.S. District Court Southern District of New York, alleging that the discounter has been selling “Tiffany” engagement rings, which was discovered by a customer shopping at a California Costco in November. According to the Consumerist, the shopper found Costco to be advertising “Tiffany” engagement rings from $3,199.99 to $6,399.99.
[ba-pullquote align=”right”]”There are now hundreds, if not thousands, of people who mistakenly believe they purchased and own a Tiffany engagement ring from Costco.”[/ba-pullquote]After an investigation by Tiffany & Co., it was found that the rings were not “manufactured by, approved by, licensed by, or otherwise in any way properly associated with Tiffany.”
Upon being contacted by Tiffany & Co., Costco removed signs and pulled ads that implied these rings were legitimately made by the famous jeweler. The complaint alleges that Costco unlawfully traded off of Tiffany & Co.’s good will and brand awareness, and claims trademark counterfeiting, unfair competition, injury to business reputation, false advertising, and deceptive business practices.
The complaint notes, “Unbeknownst to Tiffany, Costco had apparently been selling different styles of rings for many years that it has falsely identified on in-store signage as ‘Tiffany.’ There are now hundreds, if not thousands, of people who mistakenly believe they purchased and own a Tiffany engagement ring from Costco.”
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