Jury sets Tiffany damages seven times higher than Costco hoped

A jury has said Costco should pay $5.5m in compensation to Tiffany & Co for selling counterfeit copies of its engagement rings.

That figures is far in excess of the $781,000 Costco offered in reparation after being found guilty of wilfully infringing Tiffany's trademarks last year. And there could be more bad news for the retail warehouse chain as it also faces a bill for punitive damages that is still being deliberated.

After two weeks of hearings, the jury concluded that $5.5m was a reasonable figure to represent the profit Costco made from the sale of the counterfeit Tiffany rings.

In a statement, Costco noted that "proceedings will immediately follow concerning the jury's determination that Tiffany & Co is entitled to an award of punitive damages. Because the jury's deliberations are continuing, further comment is not appropriate at this time."

The main point of contention in the original trademark infringement lawsuit was whether the term 'Tiffany', could be considered a generic description for a type of diamond setting commonly used for engagement rings and popularised by the jewelry company.

The company admitted selling "unbranded rings having Tiffany settings for many years." The judge in the case - Laura Taylor Swain - concluded however that Costco misled purchasers of the rings when it used the word Tiffany in displays.