Overview
In an order yesterday, Judge Swain awarded $19.35 million in trebled profits and punitive damages to Tiffany & Co. for its trademark infringement claims against Costco. The case stemmed from Costco's use of the term "Tiffany" to describe generic rings sold in the jewelry section of its stores. The award is an increase over the original amount awarded by the jury after a trial last year.
As part of the ruling, Judge Swain found that Tiffany was still entitled to punitive damages, even though it sought an accounting of profits rather than actual damages:
Costco also argues that, because Tiffany only sought an accounting of profits and not “actual damages,” it is precluded from seeking punitive damages. Although some courts in the Second Circuit have drawn a distinction between actual damages and profits for the purposes of the Lanham Act, others have characterized both as “actual damages” available under the Lanham Act. Furthermore, the Lanham Act itself contemplates the possibility of an award of statutory damages (sought here), which permits consideration of both punitive and compensatory factors, without the need to establish profits or actual damages in the recognition that such measures of monetary relief may be difficult to prove in these cases. The provision for statutory damages in the Lanham Act thus explicitly provides a mechanism to compensate plaintiffs even in the absence of proof of actual damages or profits. Accordingly, the Court finds that punitive damages are not preluded in this case by Tiffany’s pursuit of an accounting of profits and statutory damages rather than “actual damages.”Our full coverage of the case is here.