After a court battle spanning more than two years, the US District Court for the Southern District of New York recently confirmed that to sell a ring of a style described as “Tiffany,” its maker must be Tiffany & Co. At issue was the word “Tiffany” posted in Costco’s display cases next to a series of diamond rings sold by the discount superstore. Was “Tiffany” a generic word for a six-pronged ring setting as Costco argued, or did it confuse consumers into thinking the rings were authentic Tiffany products?

A trademark becomes generic and loses legal protection when the meaning of the mark becomes associated with an entire market of products rather than the brand name. Famous genericized marks include Escalator and Thermos. In this case, despite Costco’s introduction of dictionary entries showing that “Tiffany” has become a generic descriptor of a ring setting, the court held that Costco presented inadequate evidence to show that any generic use of the word “Tiffany” undermined the strength of the Tiffany trademark. Therefore, the use of the word “Tiffany” in the display cases next to six-pronged rings infringed upon Tiffany’s rock-solid trademark rights.

In addition to trademark infringement, the court held that Costco violated the Lanham Act by selling “counterfeit” Tiffany jewelry. For a mark to be counterfeit, the Lanham Act requires that the mark is “spurious” and “identical with, or substantially indistinguishable form, a registered mark.” In addition, the use of the mark must be likely to confuse or deceive the consumer. Costco opined that the appearance and packaging of the rings were simply not confusing. The “Tiffany” trademark was not anywhere on the rings themselves, and the rings were not accompanied by false Tiffany paperwork. Plus, absent was Tiffany’s signature blue packaging and satiny white ribbon. (Coincidentally, that particular color of blue packaging is also trademarked by Tiffany, known for vigorously protecting its trademark rights).

Nevertheless, the court found that the word “Tiffany” on signs in Costco’s display cases exactly where the brand name would typically be located on other Costco products was enough to confuse consumers about the source of the rings. To justify this result, the court cited testimony from six consumers who were dismayed to learn that their rings were not made by Tiffany (including a particularly tearful consumer whose diamond fell out of her Costco ring). This evidence of likely confusion, combined with evidence of Costco’s lack of good faith in the form of damaging emails and photographs suggesting that Costco tried to copy some stylistic elements of Tiffany products, led to Tiffany’s victory on the counterfeiting claim.

The upshot is, if you are about to propose to that special someone, bear in mind that the only place you will be able to get your fiancé a “Tiffany” ring is at Tiffany & Co.