Tiffany Awarded $13.75 Million in Engagement Ring Dispute with Costco
Oct. 05, 2016|By Molly Rogers
Tiffany & Co. has received a substantial $13.75 damages award in its trademark dispute with Costco Wholesale regarding Costco’s sale of imitation engagement rings under the “Tiffany” name. Costco’s liability was decided on summary judgment last year by Judge Swain of the U.S. District Court for the Southern District of New York. You can read K&F’s analysis of that ruling here.
Following Costco’s unsuccessful appeal to the Second Circuit, the only issue remaining was a jury trial to determine the amount of damages that Costco had to pay. On September 30, 2016, a Manhattan civil jury found that Costco had earned profits of $3.7 million from the improper sale of rings using the “Tiffany” trademark. This figure far exceeds Costco’s estimate of the profits earned. But the jury went further still, finding that sum inadequate to compensate Tiffany and adding an additional $1.8 million, for a total award of $5.5 million in compensatory damages. The jury also awarded the maximum amount possible ($2 million) in statutory damages, although Tiffany chose the profit award rather than statutory damages. On the heels of that ruling, this week, the jury awarded Tiffany & Co. an additional $8.25 million in punitive damages. Judge Swain had previously held that Tiffany could seek punitive damages under New York’s unfair competition laws because there was sufficient evidence that Costco’s conduct constituted “gross, wanton or willful fraud.” If the jury’s award is upheld by the Court, an appeal by Costco will almost certainly follow.