A subsidiary of jeweler Tiffany & Co. is suing wholesale retailer Costco, claiming the chain has been selling engagement rings wrongly labeled as "Tiffany" rings, the Associated Press reported.

A lawsuit was filed in U.S. District Court in New York on Thursday, which coincidentally was a popular day for giving jewelry, Valentine's Day.

The allegations against Costco include trademark infringement, injury to business reputation, counterfeiting, unfair competition, false advertising and deceptive business practices, the report stated.

Tiffany & Co. stated that the rings sold as "Tiffany" at Costco are in no way associated with the company, the report stated.

The company was alerted to the issue in November when promotional material for "Tiffany diamond engagement rings" in a Huntington Beach, Calif. Costco was brought to its attention by a suspicious customer, the AP reported.

After launching an investigation following the tip, Tiffiany & Co. learned that Costco as been selling different types of rings identified as "Tiffany" rings for many years without the company's knowledge, the article stated.

Tiffany indicated Costco has been leading its customers to believe they were buying authentic Tiffany products at significant discounts, according to the AP. 

"We now know that there are at least hundreds if not thousands of Costco members who think they bought a Tiffany engagement ring at Costco, which they didn't," Jeffrey Mitchell, Tiffany's counsel in the case, said in a statement reported by the AP. "Costco knew what it was doing when it used the Tiffany trademark to sell rings that had nothing to do with Tiffany. This is not the kind of behavior people expect from a company like Costco, and this case will shed a much needed light on this outrageous behavior."

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