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New Jersey business litigation: Costco under fire by Tiffany's

Many in New Jersey may not have heard that Costco Wholesale Corp. is being sued by Tiffany & Co. The business litigation surrounds Tiffany's allegations that Costco violated trademark laws when it sold rings that were supposedly Tiffany diamond engagement rings. Tiffany & Co is asking for the profits Costco received from its sales of the subject rings as well as up to $2 million for each infringement.

According to court documents, a Costco customer on the west coast complained to Tiffany & Co about the engagement ring, spawning an investigation by the famous jeweler. The jeweler alleges that a display case in the Costco the customer patronized contained rings purporting to be from Tiffany & Co. The sales person also asserted the rings were from the jeweler.

The lawsuit goes on to allege that Costco did not market these same rings as being from Tiffany & Co. on their website. The jeweler asserts this was in order to avoid detection. Whether the allegations in the lawsuit are valid will now be up to a federal court.

When a business obtains a trademark, no one else is allowed to use that trademark without the express consent and permission of its owner. Any business in New Jersey that finds another company has infringed upon its trademark rights has the right to file a lawsuit to stop the other company from using and profiting from the trademark. This type of business litigation cannot only keep another company from profiting from one company's work, but it can also keep other companies from tarnishing its reputation. This is part of the issue that Tiffany & Co has with Costco's use of its trademark.

Source: Reuters, "Tiffany sues Costco over sales of engagement rings," Gary Cameron, Feb. 14, 2013

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