Costco, the huge warehouse supermarket club, has been ordered by a federal judge to pay Tiffany & Co. $19.4 million. Why? Because the warhorse club allegedly mislead customers into believing that they were selling actual jewelry from Tiffany & Co at massive discounted prices.
The trial uncovered details that for about seven years, Costco had been sold thousands of rings mislabeled as Tiffany’s. The real Tiffany & Co was awarded $8.25 million in punitive damages, and $11.1 million in damages.
According to Laura Taylor Swain, a Manhattan federal court judge, Costco really did not seem to pair. She said, at best, their attitude was cavalier over the use of the Tiffany name in their marketing. Costco is claiming that there were multiple errors in the case’s pretrial, in the trial itself, and in the post-trial findings, that corrupted the ruling. The warehouse club plans on appealing the decision.
Costco said that they were using the name Tiffany to describe a specific setting, not a brand, even saying that the dictionary defines Tiffany as a setting. However, the signage and displays Costco had were apparently very misleading, and customers were very upset when they found out the ring they got for such a deal was not actually a Tiffany & Co. product, according to The New York Post.
It is not the first time Costco has tried to pull the wool over peoples eyes. A couple decades ago, the warehouse company was displaying VHS copies of Cinderella, which were packaged very closely to the Disney classic film packaging. The Disney version was not available, but the displays at Costco convinced many customers that they were buying the Disney version, but instead were purchasing a poorly animated knock-off.
However, that incident was not taken to court, and just ended up irking video store employees who had to explain to customers that it was not the real Cinderella they saw, that Disney is not currently selling it. For the current lawsuit, the decision in Tiffany’s favor was vindication for a four year long lawsuit that began in 2013 on Valentine’s Day. The finding for Tiffany & Co. strengthens and validates the name and value of the iconic brand, according to Leigh Harlan, general counsel for Tiffany & Co.
In all honesty, the only way to get a deal on a Tiffany & Co. product is either to find a location that is clearing out some older settings that they are discontinuing, or not he secondary market, neither of which happen often for a discount. As for Costco, while they were found guilty in their marketing of these specific rings, there is no word if the will change their overall marketing campaigns or plans. One could easily be drawn in by a future campaign thinking they are purchasing one thing, only to discover that they were misled into purchasing something else altogether.
By Cletus Dillwood