US-based sportswear giant NIKE has reportedly filed a lawsuit against online reselling platform StockX in a federal court in New York over unauthorised non-fungible tokens (NFTs).
Based in Detroit, StockX is engaged in reselling sneakers, handbags and other goods.
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Last April, the company raised $255m in funding, valuing the company at $3.8bn.
Nike alleges that StockX has started selling new virtual products using Nike’s trademarks without consent, with more than 500 Nike-branded Vault NFTs said to have been sold so far.
On 2 February, the sportswear retailer filed a 50-page complaint with the US District Court for the Southern District of New York.
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In its complaint, Nike said: “Without Nike’s authorisation or approval, StockX is ‘minting’ NFTs that prominently use Nike’s trademarks, marketing those NFTs using Nike’s goodwill, and selling those NFTs at heavily inflated prices to unsuspecting consumers who believe or are likely to believe that those ‘investible digital assets’ (as StockX calls them) are, in fact, authorised by Nike when they are not.
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By GlobalData“Nike did not approve of or authorise StockX’s Nike-branded Vault NFTs. Those unsanctioned products are likely to confuse consumers, create a false association between those products and Nike, and dilute Nike’s famous trademarks.
“Given Nike’s longstanding use in this space, StockX’s unauthorised and unapproved branding of Vault NFTs with Nike trademarks is all the more likely to confuse consumers, create a false association between the parties, jeopardise the capacity of Nike’s famous marks to identify its own digital goods in the metaverse and beyond, and harm Nike’s reputation through an association with inferior digital products.”
The lawsuit comes after Nike purchased RTFKT Studios, an NFT-based apparel and footwear start-up, for an undisclosed sum in December.
RTFKT creates virtual sneaker designs, memes and other collectable exclusives inspired by video games.
Nike reportedly plans to release several virtual products later this month.
