Costco Wholesale (COST) on Monday asked the U.S. Supreme Court to continue to allow it to sell products made overseas at a discount in U.S. stores. The debate comes after Swiss company Swatch Group (SWGAY) pushed to use its copyrighted logo to legally prevent the largest U.S. warehouse retailer from selling its Swiss-made watches in the U.S., Bloomberg News reported.

Costco asked the court to extend a 1998 ruling that limits foreign manufacturers' ability to bar goods from being imported to the U.S. after they'd been sold to a distributor or other entity overseas, according to Bloomberg. The ruling opened the door for the so-called "gray market," in which retailers can take advantage of lower prices offered in other countries.

Swatch's Omega unit imposed its copyright after Costco found an overseas distributor selling Omega's Seamaster watches at such a low wholesale price that Costco was able to offer them for almost $700 below the watch's $1,995 suggested retail price, according to Bloomberg. A Deloitte report estimates the gray market can cost global manufacturers $63 billion, or almost 5%, in annual sales, the story notes.

Costco said last month that its fiscal fourth-quarter profit rose 16% from a year earlier, while same-store sales increased 6%. Revenue rose 7.8% to $23.6 billion.


Increase your money and finance knowledge from home

Understanding Stock Market Indexes

What does it mean when people say "the market is up 2%"?

View Course »

Socially Responsible Investing

Invest in companies with a conscience.

View Course »

Add a Comment

*0 / 3000 Character Maximum

2 Comments

Filter by:
limsam614

Omega watches have been the most exquisite appearance, and gorgeous watch live in peoples hearts.


http://www.watchnation.net/omega.htm

February 26 2011 at 7:57 PM Report abuse rate up rate down Reply
Scottilla

A Deloitte report estimates the gray market can cost global manufacturers $63 billion, or 5%, in annual sales, the story notes. That means that Swatch didn't sell the watches. !?!

November 08 2010 at 7:38 PM Report abuse rate up rate down Reply