A federal appeals court on Monday overturned Tiffany’s $ 21 million judgment against Costco over the sale of the chain’s warehouse association of unbranded diamond jewelry rings called “Tiffany”.
In a 3-0 decision, the 2nd U.S. Circuit Court of Appeals in Manhattan said it agreed with Costco that the use of the word “Tiffany” was unlikely to confuse customers, and that Costco was right in good faith to style of their descriptive rings, even if confusion was likely.
Tiffany had filed with Costco on Valentine’s Day in 2013 for trademark infringement, accusing the chain of counterfeiting.
Costco objected that “Tiffany” had become a generic term, and that it had removed “Tiffany” from retail brands within one week of being contacted by that company.
The appeals court returned the case to a federal district court for a new trial.
Lawyers for Tiffany and Costco did not immediately respond to requests for comment.
Tiffany advocates for the protection of its brand and cachet as one of the most renowned luxury retailers in the world.
An estimated 3,349 customers purchased Tiffany set rings from Costco during the relevant period.
The $ 21 million prize included $ 8.25 million in punitive damages, $ 11.1 million representing triple Tiffany’s lost profits from Costco’s proven infringement, and interest.
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