The 5 Dumbest Things on Wall Street This Week: March 16
5. Tiffany's Tiff
Come on Tiffany(TIF) . Can't you and Swatch simply drop all the lawsuits and settle this silliness over a nice breakfast?
Tiffany & Co. filed a $590 million counter-claim against the Swiss watchmaker Monday in a Dutch arbitration court. The legal retaliation comes three months after Swatch sued the fabled retailer -- and its former partner -- for an estimated $4.2 billion in lost profits. The pair originally tied the knot back in 2007 to boost the development of Tiffany-branded watches, but the 20-year deal ended in acrimony last September.
Swatch said Tiffany's claim "has no factual or legal basis" and it will contest it "vigorously." Furthermore, Swatch told the press that it planned to keep the engagement ring because Kim Kardashian kept her 20.5 carat sparkler and she was only hitched for 72 days.
Okay. Okay. We're just kidding about Swatch citing Kim's wedding ring controversy. But it is hard for us not to chuckle at this joke of a legal battle.
Swatch said it had invested "millions to develop, distribute and sell Tiffany & Co. watches," but that the venture was undermined by "systematic efforts" by Tiffany to block the business from growing.
As to how those millions Swatch sunk into the failed marriage translate into $4.2 billion in lost earnings, well, we have no idea.
Meanwhile, on the other side, the deal with Swatch represented less than 1% of sales in 2010, or less than $30 million, according to Tiffany's most recent annual report. So where on earth does Tiffany get the stones to counter-sue for a gob-smacking $590 million? Once again, we have no clue.
That said, we do know it's time for Tiffany to end this tiff, not escalate it with another stupid suit.
Seriously guys, who cares if Swatch is ticked off? They have plenty of time to get over it. Just watch them.
4. Coffee's Cold War
Two powerful leaders made major pronouncements last week, avowing their friendship and promising continued cooperation. The equity markets, nevertheless, saw through their platitudes and revealed what could soon be a sizable rift between the once-close confidantes. Meanwhile, the cost of the black liquid that Americans just can't live without unnervingly continues to escalate.