Update: U.S. District Court Judge Laura Taylor Swain has awarded Tiffany & Co. $11.1 million in treble profits and $8.25 million in punitive damages. Judge Taylor Swain wrote in her opinion that Costco’s management “displayed at best a cavalier attitude toward Costco’s use of the Tiffany name in conjunction with ring sales and marketing.” Under trademark law, the court has discretion to award profits at a higher amount than the defendant’s actual profits if the court finds that recovery based on profits is inadequate.  As we discussed in our article, punitive damages are not recoverable under federal trademark law.  Instead, punitive damages are awarded under state unfair competition laws.  This case demonstrates that when filing a complaint based on trademark infringement, plaintiffs should also plead any viable state unfair competition claims and argue that the defendant’s approach to the infringing use of the mark warrants a higher recovery.