Retailer responds to Nike NFT lawsuit, saying it 'lacks merit'

Online reseller StockX filed a response Thursday to a recent Nike lawsuit against it, saying Nike’s infringement claims against StockX’s new non-fungible token collection “lack merit.”



The Beaverton-based footwear giant (NYSE: NKE) accused StockX in February of selling NFTs depicting Nike shoes without the company’s permission. StockX, according to the suit, took advantage of Nike’s popular imagery to create the digital works of art depicting physical Nike shoes for sale on its website under its recently launched collection called StockX Vault NFT.

Additionally, Nike said StockX’s Vault NFT collection confuses consumers and “deprives Nike of its exclusive right to use its marks in connection with this new commercial medium.”

In December, Nike purchased RTFKT Studios, which creates virtual sneakers and collectibles.

StockX responded to the complaint by saying Nike has a “fundamental misunderstanding of the various functions NFTs can serve,” and that the digital assets cause no confusion because the reseller makes it clear to buyers that the NFTs themselves are not physical shoes.

The popular reseller said it's only using NFTs as a way to authenticate physical shoes, and not selling them as their own product.

“The Vault NFT itself has no intrinsic value — it is effectively a claim ticket, or a “key” to access the underlying Stored Item,” StockX’s answer said.

NFTs have garnered massive popularity in the last few years as the technology shifts from just something a tech-savvy audience can access to something much more mainstream. NFTs exist on a blockchain, or a virtual ledger of ownership that not only serves as a type of certificate of authenticity, but tracks who owns what.

StockX said its Vault NFTs not only ensure that the shoes are authentic, but that the ownership history of them can be preserved and easily accessed.

“Nike’s suit threatens the legitimate use of NFTs not just by StockX, but by other innovators that also use NFTs to track title to physical goods held in a vault, such as fine art, whiskey and wine,” StockX states. “The use of NFTs to digitally track ownership of physical products is not only lawful, but it also increases efficiency for and decreases costs to consumers, promotes sustainability and should not be disturbed.”

Nike is represented by DLA Piper LLC of New York and StockX is represented by Kilpatrick Townsend & Stockton LLP of New York.

Previous Post Next Post

ADS