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Nike, the globally acknowledged athletic footwear and apparel company previously renowned in the non-fungible token market for its digital sneaker collectibles, has finally announced that it will dismiss the case against StockX, another renowned online marketplace and clothing reseller, primarily of sneakers. In this article, we shall discuss in depth this lawsuit and what people should expect moving forward.
In an August 29 submission before the United States District Court for the Southern District of New York, Nike and StockX told the court that they would dismiss the case with prejudice, which means it cannot be refiled. The giant companies said in a joint statement that they had resolved the case “amicably” on confidential terms. Under this settlement, each party will bear their own expenses, Attorney’s fees, and costs.
Nike is a global sportswear and footwear giant, famous for its innovative athletic shoes, apparel, and equipment, along with its iconic “Swoosh” logo and “Just Do It” slogan. The footwear giant joined the non-fungible token space sometime in 2021. To effectively leverage the technology at the time, the athletic footwear and apparel company acquired RTFKT NFT studio, which aimed to bridge the gap between physical and digital fashion.
The digital asset incubation studio RTFKT created digital fashion items primarily intended for video games and virtual environments. For the past three years, RTFKT has launched several non-fungible token series, including Clone X, a non-fungible token collection featuring a limited edition of 20,000 NFTs hosted on the Ethereum blockchain network. Unfortunately, Nike closed its NFT studio earlier this year.
Nike filed a lawsuit against Stock X, an online marketplace that functions like a “stock market of things,” allowing users to buy and sell sneakers, streetwear, electronics, collectibles, and luxury accessories, earlier in 2022. Nike stood before the New York federal court Judge Valerie Caproni and sued online footwear reseller StockX for selling unauthorized non-fungible token series with images of Nike shoes.
Nike, through its attorney, argued its users and consumers would likely be confused into thinking that StockX’s NFTs were associated with them. The footwear giant further alleged that StockX’s NFT images of Nike sneakers infringed its trademarks. The lawsuit said complaints about the NFTs’ “inflated prices and murky terms of purchase and ownership” and buyers’ doubts about the legitimacy of StockX’s model had hurt Nike’s business reputation.
In the same charge sheet, Nike added claims that StockX sold counterfeit shoes and argued that the counterfeiting undermined StockX’s argument that the NFTs were part of a process to guarantee its shoes’ authenticity. The plaintiff “Nike” said StockX had sold more than 500 Nike-branded NFTs. StockX denied the allegations and called them “disingenuous.” Nike demanded unspecified money for damages and an order blocking their sales to settle the NFT lawsuit.
It’s worth noting that Yuga Labs, the digital asset incubation studio, has a similar case with digital artist Ryder Ripps. Yuga Labs filed its first lawsuit against the digital artist and investor Ryder Ripps and his team in 2023, accusing them of trademark infringement. Yuga Labs accused Ryder Ripps and his team of selling a parallel NFT collection, “RR/BAYC,” that seemed identical to its Bored Ape Yacht Club NFTs.
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