A maker of luxury timepieces has taken its legal tussle with Costco
Swatch Group's Omega luxury watch brand will square off against Costco in the nation's highest court. According to The Wall Street Journal, Omega claims that Costco violated copyright law in 2004, when it peddled Omega Seamaster watches bearing an emblem that Omega had registered with the U.S. Copyright Office. Costco had obtained the watches from foreign third-party sources and sold them for $1,299, compared to Omega's preferred $1,999 retail price.
But how much of this issue is really about protecting Omega's copyright, and how much is really about its ability to maintain its high margins and to keep such merchandise out of deep discounters' hands?
Costco is well-known and well-loved for offering high-end merchandise for lower-end prices. However, its cost-cutting behavior doesn't always go over well with luxury-goods providers, who need to protect their high-end brands by charging high-end prices.
Intellectual property and copyright skirmishes are hardly unheard of in the retail biz. Urban Outfitters
Such entanglements aren't new for Costco, either. In 2008, Crocs
The current Costco case has major retail ramifications, even beyond obvious names such as eBay and Amazon.com
Diehard bargain shoppers should keep an eye on this battle, too. If retailers are blocked from buying from third parties, exciting bargains could become far less common in the aisles of their favorite stores.
I can totally understand why consumer-goods companies would want to protect their brands -- and by extension, the premium prices they command. However, companies such as Costco, eBay, and many others appeal to what is, for many of us, one of the greatest recreational activities around: the competitive hunt for the lowest price for quality merchandise.
Should Costco prevail, or does Omega have a point? Sound off in the comments boxes below.
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