U.S. District Judge Laura Taylor Swain ruled earlier this month that Costco Wholesale Corporation can proceed with its defense that seeks to prove the "Tiffany setting" is now a generic term, according to Rapaport. Tiffany & Co. sued Costco last year, claiming the wholesale store infringed its trademark "Tiffany setting" and in so doing diluted Tiffany's brand, counterfeited its jewelry and used unfair advertising schemes to sell diamond rings.
Costco asserted "Tiffany setting" is a generic trade reference to a particular type of ring, and that Tiffany's trademark on it is unfair. Tiffany requested this line of defense be dismissed, arguing it is not in fact generic due to the company's multiple federal trademark registrations.
While the court recognized Tiffany & Co. holds 97 trademarks related to the company name, the judge wrote, "Once a plaintiff shows that a trademark has a valid registration, the burden of production therefore shifts to defendant to proffer evidence that the mark is not valid, i.e., that it is generic."
Even incontestably registered marks may become invalid if they have become generic names for goods or services, which is the thrust of Costco's argument. While Tiffany maintains the phrase "Tiffany setting" is not generic, the judge allowed Costco to proceed with that argument. She ruled there is enough evidence to frame a factual question as to whether the phrase is now primarily generic.