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Jewelry maker sues over Costco’s Tiffany rings

Iconic jewelry maker Tiffany is suing Redmond-based Costco for allegedly selling fake Tiffany rings. (AP image)

Items such as Aspirin and Thermos are so common that most people use the name to refer to the product, not the brand. That’s how trademark protections are lost and that’s why corporate America defends its trademark brands like most parents protect their child.

If you’ve shopped for jewelry at Costco, you might have noticed Tiffany rings for sale. Tiffany is suing Costco in federal court, claiming trademark infringement. It calls the Costco rings counterfeits.

Seattle trademark attorney Michael Atkins, with Atkins Intellectual Properties, said there’s plenty at stake for Tiffany, which has spent decades cultivating its name and its brand.

“If Tiffany were to lose its brand, it would lose millions and millions of dollars worth of good will that it has built up with its trademark.” Atkins said trademarks are lost when companies don’t use them or defend them. “Elevator, escalator, nylon, raisin bran. Those are all formerly proprietary trademarks,” he said.

Costco is acting as if Tiffany is already a generic term. The Issaquah-based warehouse giant has counter-sued, claiming its rings sold with the Tiffany name refer to a type of stone setting. Attorney Atkins says Costco can win this case “if Costco can show that the consuming public knows the type of diamond setting to be a tiffany setting, in a generic sense.”

To persuade the court, either company could commission a consumer survey to demonstrate how the public views the use of Tiffany, said Atkins.

Tiffany famously sued eBay a few years back, but lost its claim that the online auction site failed to protect against the sale of counterfeit Tiffany rings.

In this case, Atkins said Costco must show that “Tiffany” is a generic term.

“I think it’s an uphill battle. Closer to the line is Xerox, Kleenex. Those are still proprietary trademarks. Google, too. And those companies are spending a lot of money trying to educate the public,” said Atkins.

What’s different about this case is the battle of titans. Trademark lawsuits often involve large companies going after small companies.

“It’s just unusual to have a name-brand company, like Tiffany, suing another name-brand company, like Costco, saying that Costco wrongly used the Tiffany brand,” said Atkins.

The judge has referred Costco and Tiffany to mediation, hoping a retired judge can broker a settlement in this trademark battle between corporate giants.

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