Southern District of New York Jury Orders Costco to Pay Tiffany & Co. $8.25 Million in Punitive Damages for Selling Trademark-Infringing Engagement Rings

Oct 17, 2016

Reading Time : 1 min

Tiffany first came to know of Costco’s allegedly infringing activity in November 2012, when a customer alerted Tiffany that it had observed Costco rings that it believed were being advertised as “Tiffany” rings. Tiffany initiated the lawsuit in February 2013, which was followed by Costco’s counterclaim alleging that the “Tiffany” mark was generic. In September 2015, Judge Laura Swain ruled on the parties’ cross motions for summary judgment, granting Tiffany’s motion for summary judgment with respect to Costco’s liability for trademark infringement and counterfeiting, and denying Costco’s counterclaim that the “Tiffany” mark had become generic.

In finding a likelihood of confusion, the court noted the testimony of several Costco customers who were actually confused, as well as Tiffany’s expert, who concluded that “more than two out of five prospective purchasers of diamond engagement rings at Costco were likely confused into believing that Tiffany & Co. was the source of the rings.” Despite Costco’s argument that “Tiffany” appears in the dictionary as a descriptive term, the court had also rejected Costco’s genericism argument, noting that “Costco has proffered no affirmative evidence that raises a material issue of fact with respect to the issue of whether the primary significance of the Tiffany mark to the relevant public is as a generic descriptor or a brand identifier.”

Although only 2,500 of these rings were reportedly sold (with a majority of these customers offered refunds), and although Costco had argued at trial that the maximum damages figure was $781,000, the total award (compensatory and punitive) against Costco is now $13.75 million. The jury’s punitive damages finding was likely due in part to the court’s previous finding that emails “were sent from Costco jewelry buyers asking vendors to copy Tiffany designs, as well as testimony indicating that Costco employees were aware of customer confusion but did nothing to remedy it.”

Tiffany & Co. v. Costco Wholesale Corp., No. 1:13-cv-01041-LTS-DCF (S.D.N.Y. October 5, 2016).

Share This Insight

Previous Entries

IP Newsflash

March 12, 2026

The Northern District of Illinois recently dismissed a complaint without prejudice for failing to plausibly allege patent infringement. The court found that the allegations of direct infringement were insufficiently pled where the images of the accused product included in the complaint did not appear to show a particular necessary element of the claims.

...

Read More

IP Newsflash

March 12, 2026

The District of New Jersey recently denied the litigants’ request for a briefing schedule to resolve a dispute about a proposed discovery confidentiality order, and also denied extending the deadlines for the defendants’ invalidity and non-infringement contentions. At issue was the scope of the FDA and patent prosecution bars in the confidentiality order.

...

Read More

IP Newsflash

February 27, 2026

The USPTO Director denied a patent owner’s request for discretionary denial of two inter partes review (IPR) petitions, citing the petitioner’s “well-settled expectation” that it would not be accused of infringing the two challenged patents. The Director’s conclusion was based on the petitioner’s decade-long business relationship with the original owner of the challenged patents.

...

Read More

IP Newsflash

February 24, 2026

The Southern District of Florida recently dismissed a complaint without prejudice because the allegations used a form of “shotgun pleading.” The court explained that a shotgun pleading includes those where every count incorporates every preceding paragraph into each cause of action, and that dismissal of such pleadings was required under Eleventh Circuit precedent.

...

Read More

© 2026 Akin Gump Strauss Hauer & Feld LLP. All rights reserved. Attorney advertising. This document is distributed for informational use only; it does not constitute legal advice and should not be used as such. Prior results do not guarantee a similar outcome. Akin is the practicing name of Akin Gump LLP, a New York limited liability partnership authorized and regulated by the Solicitors Regulation Authority under number 267321. A list of the partners is available for inspection at Eighth Floor, Ten Bishops Square, London E1 6EG. For more information about Akin Gump LLP, Akin Gump Strauss Hauer & Feld LLP and other associated entities under which the Akin Gump network operates worldwide, please see our Legal Notices page.