Tiffany v. Costco: Not dead yet

Wow. Remember Tiffany v. Costco? Of course you do.

Well, now this:

This is a big deal. I did think summary judgment was a bit much, and I said so. But I don’t think I said this (per Julie Zerbo):

In its decision on Monday, the Second Circuit held that the district court got the matter wrong on the basis that it is reasonable that jurors could conclude that Costco’s use of the “Tiffany” name in connection with the sale of six pronged diamond rings is not likely to confuse consumers or lead them to believe that Tiffany & Co. endorsed or was in some way connected to the sale of the rings. Instead, the court determined that reasonable consumers would likely know that Tiffany “had nothing to do with Costco’s diamond engagement rings.”

To be exact, the appeals court “conclude[d] that Costco’s evidence has, when considered in the aggregate, created a genuine question as to the likelihood of customer confusion,” namely due to “the combination of (1) Costco’s evidence that ‘Tiffany’ is a broadly recognized term denoting a particular style of pronged ring setting and (2) its further indications, backed by prior pronouncements of this court, that purchasers of diamond engagement rings educate themselves so as to become discerning consumers.”

In other words, “A jury could reasonably conclude that consumers of diamond engagement rings would know or learn that ‘Tiffany’ describes a style of setting not unique to rings manufactured by Tiffany, and [could] recognize that Costco used the term only in that descriptive sense.” Moreover, the court held that “such consumers may also be distinctly capable of recognizing that Costco’s rings were not manufactured by Tiffany – based, for example, on their price, place of purchase, packaging, or paperwork – and consequently be particularly unlikely to be confused by any aspect of Costco’s point-of-sale signs.”

The Second Circuit also asserted that a jury could reasonably conclude that Costco did not use the term ‘Tiffany’ as a trademark.” After all, “Tiffany’s own evidence indicates that Costco typically identifies the trademark associated with its branded products as the first word on the product label,” while Costco provided evidence that by way of “over a century’s worth of documents [that] suggest that ‘Tiffany’ – both alone and in conjunction with words like ‘ring,’ ‘setting,’ ‘style,’ or ‘mounting’ – is widely understood to refer to a particular type of pronged diamond setting.”

Ultimately, the appeals court found that a factual dispute exists in terms of whether Costco’s use of the word “Tiffany” was merely descriptive and used to refer to a type of ring setting, thereby, falling within the bounds of fair use … or whether its use was infringing, and thus, held that the case should not have been decided without a jury trial on the merits. As a result, the matter has been remanded to the district court for a new trial.

Appeals Court Sides with Costco in $21 Million Fight Over “Counterfeit” Tiffany Rings

No, I didn’t quite say this… but I should have. It is the right decision.

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