Tiffany Files Lawsuit Against Costco for Trademark Infringement

  Tiffany Files Lawsuit Against Costco for Trademark Infringement

 Tiffany protects customers and brand by seeking to halt sales of counterfeit
                                diamond rings

Business Wire

NEW YORK -- February 14, 2013

Moving to protect its customers and its brand, Tiffany and Company, wholly
owned subsidiary of Tiffany & Co. (NYSE: TIF) today filed suit against Costco
Wholesale Corporation to prevent further sales of counterfeit diamond
engagement rings and for damages associated with prior sales. The suit was
filed in the U.S. District Court for the Southern District of New York, and
alleges trademark infringement, dilution, counterfeiting, unfair competition,
injury to business reputation, false and deceptive business practices and
false advertising.

In November, 2012, a customer alerted Tiffany to the sale of what was promoted
on in-store signs as “Tiffany” diamond engagement rings at a Costco store in
Huntington Beach, California. Tiffany immediately launched an investigation,
and later learned that for many years, and without Tiffany’s knowledge, Costco
had apparently been selling different styles of rings that it has falsely
identified on in-store signage as “Tiffany.” The rings are not in fact Tiffany
rings, nor are they manufactured by, approved by, licensed by, or otherwise in
any way properly associated with Tiffany. In this way, Costco led its members
to believe they were purchasing authentic Tiffany products at significant
discounts, when in fact, that was simply not true.

“We now know that there are at least hundreds if not thousands of Costco
members who think they bought a Tiffany engagement ring at Costco, which they
didn’t. Costco knew what it was doing when it used the Tiffany trademark to
sell rings that had nothing to do with Tiffany. This is not the kind of
behavior people expect from a company like Costco, and this case will shed a
much needed light on this outrageous behavior,” said Jeffrey Mitchell of
Dickstein Shapiro, Tiffany’s counsel in the case. “The Tiffany brand has been
damaged, Costco members have been damaged, and Costco has profited from the
sale of engagement rings by misrepresenting what they were. We will get to the
bottom of what Costco was up to and why, and right a terrible wrong,” Mitchell
added.

For more than 175 years, the Tiffany trademarks have been applied to high
quality goods, including in particular high-end jewelry. Authentic Tiffany
jewelry is manufactured to strict specifications, and then subjected to
rigorous quality control standards to assure the public about the provenance
and quality of each Tiffany item. Tiffany diamond engagement rings are then
backed by a lifetime guarantee. Additionally, to protect the brand, Tiffany
fine jewelry is sold only in Tiffany retail stores by trained sales
professionals, and is not distributed or sold at discount through other
wholesale or retail establishments. In particular, Tiffany has never sold nor
would it ever sell its fine jewelry through an off-price warehouse retailer
like Costco, either directly or indirectly.

To protect the public, Tiffany maintains an aggressive and rigorous
intellectual property program, and regularly takes actions against
counterfeiters and infringers. “What’s different here from many other cases of
counterfeiting,” notes Mitchell “is that here customers might be more easily
taken in since Costco members expect authentic brand name merchandise at
discount prices at Costco. Everyone knows that buying something on a street
corner or over the internet from an unknown source is risky. Until now, no one
would have thought it could be risky to buy brand name merchandise from Costco
as well.”

Tiffany & Co. operates jewelry stores and manufactures products through its
subsidiary corporations. Its principal subsidiary is Tiffany and Company. The
Company operates TIFFANY & CO. retail stores and boutiques in the Americas,
Asia-Pacific, Japan, Europe and the United Arab Emirates and engages in direct
selling through Internet, catalogue and business gift operations. For
additional information, please visit www.tiffany.com.

Contact:

Tiffany & Co.
Linda Buckley, 212-277-5900
linda.buckley@tiffany.com
 
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