Whether Tiffany is a generic term – a question for $21 million

One interesting recent lawsuit from the US where Tiffany & Co. initiated legal proceeding against Costco Wholesale.

The dispute at hand concerns unbranded diamond engagement rings labeled “Tiffany” on point-of-sale signage.

According to Tiffany & Co. this trade practice was a trademark infringement.

According to Costco there was no infringement because the term Tiffany has become generic for those sort of products. It merely indicated the setting not the source of trade origin. Because of that the use of the word was fair.

The New York court dismissed the Costco’s arguments as groundless stating that the trademark infringement was completely clear. The court awarded $21 million in damages.

In the appeal, however, the U.S. Court of Appeals disagreed with this decision. According to the court, the Costco’s argumentation for possible generic character of Tiffany wasn’t scrutinize enough. Because of that the court returned the case to the district court for a new trial.

It would be interesting whether Costco will be able to prove that Tiffany is a generic term which sounds a bit unlikely at that point.

Source: John M. Bowler and Shaleen J. Patel – Troutman Pepper за Lexology.

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