RAPAPORT... Costco Wholesale Corporation's claim describing the ''Tiffany setting'' as a generic term, not defined by Tiffany & Co.'s trademark, is evidence that the defendant's legal team is misinformed, according to Tiffany & Co.'s latest comment on the trademark suit it has engaged against the warehouse club.
Attorneys for the plaintiff charged Costco with citing unreliable sources, including a book called ''Wedding Planning for Dummies,'' to defend the sale of rings with, admittedly a ''Tiffany setting,'' in its club stores, when, in fact, the “Tiffany® Setting” is a particular style of engagement ring designed by Charles Lewis Tiffany, who founded Tiffany in 1837, and launched by Tiffany in 1886.
Tiffany & Co.'s attorneys told the court in a filing today that the Tiffany Setting has been continuously manufactured by Tiffany & Co., in accordance with strict proprietary standards and specifications, for well over one century and those proprietary specifications set standards for the quality and visual appearance of the ring itself, including the shank, head and prongs, the quality of the diamond, and the manner in which the diamond must be set.
''Only a ring made by Tiffany, and certified following inspection by Tiffany as meeting all of Tiffany’s strict standards and specifications, is a Tiffany Setting,'' the plaintiff told the court.
Attorneys for the plaintiff asked the judge to consider the defendant's conduct in selling rings with Tiffany & Co.'s trademarks as willful disregard for the law and intentionally carried out to mislead Costco's customers. The plaintiff also stated that its original suit against Costco does not allege the use of a ''Tiffany setting,'' which is the only point the defendant addressed in its counterclaim, but instead describes engagement rings being sold in warehouse clubs as ''Tiffany.'' Examples of signage included, ''Platinum Tiffany .70 VS2, 1 Round Diamond Ring,'' and ''Platinum Tiffany VS2.1 1.00Ct Round Brilliant Solitaire Ring.''
Tiffany & Co. stated for the record that it holds a federally registered, incontestable trademark that has been continuously used for over 175 years and enjoys worldwide fame and recognition as designating superior goods from Tiffany.
Tiffany & Co. also submitted an email allegedly sent by Costco's CEO, Craig Jelinek, to club employees after the plaintiff filed its lawsuit, explaining “In retrospect, it would have been better had we not used that description the way we did.”
The plaintiff added that it lacks sufficient knowledge to form a belief regarding the truth of the allegations concerning the defendant’s general practices over the past decade in connection with the sale of counterfeit Tiffany rings. However, attorneys alleged that with respect to the rings observed in November 2012 at Costco, which they said were falsely being offered as “Tiffany” rings at the club's Huntington Beach, California store, even the salesperson falsely described those rings as “Tiffany” and there was no disclaimer or other notice to warn Costco members.
Tiffany & Co. charged that Costco admitted to using the Tiffany trademark in its counterclaim, which was unlawful, and that its action explained why, after the suit was filed in February, the Costco removed the signs describing replicas of actual Tiffany engagement rings and not the phrase ''Tiffany setting,'' which it claims was too in violation of trademark law. Furthermore, none of the rings being sold by Costco qualified as a Tiffany Setting, according to the plaintiff. Other rings and jewelry for sale by Costco were not labeled by referring to any well-known brand, except Tiffany, according to the attorneys.
With its own admission, Costco ''voluntarily assumed the risk of the consequences of its actions, and the use described in the complaint therefore qualifies as willful under the law,'' according to the plaintiff.
Tiffany & Co, seeks damages of $2 million per violation, plus statutory damages, treble damages, punitive damages, costs and attorneys’ fees, and a trial by jury.