American MNC, Nike had filed a lawsuit against the resale marketplace StockX over its Vault NFTs. Nike filed the lawsuit in February, and a month later, StockX responded with a court filing claiming that it lacks merit.
StockX says that the NFTs minted on their platform are used solely for the purpose of representation of the physical product and hold no inherent value. They further went on to clarify that “Vault NFTs are absolutely not “virtual products” or digital sneakers.”
StockX contends that the lawsuit filed by Nike is “nothing more than a baseless and misleading attempt to interfere with the application of a new technology to the increasingly popular and lawful secondary market for the sale of its sneakers and other goods.”
Nike says that StockX has been minting NFTs using its trademark and selling the products for heavily inflated prices to “unsuspecting consumers”. Nike has also accused StockX of providing “additional StockX services and unspecified benefits (“exclusive access to StockX releases, promotions, events”)” along with the NFTs, none of which is sold by Nike.
StockX statement said that Nike’s claims “lack merit, disregard settled doctrines of trademark law (including those of first sale and nominative fair use), and show a fundamental misunderstanding of the various functions NFTs can serve.”
StockX explains that the Vault NFTs represent physical products which are stored securely by the company, allowing users to track ownership of their physical products as well as hold, buy or sell the products without the hassle of repeated shipping. The company also says that the users can redeem their physical products whenever they want.
As such StockX believes that their use of NFTs is “no different than major e-commerce retailers and marketplaces who use images and descriptions of products to sell physical sneakers and other goods.”
Nike on the other hand has different opinions about this matter. Nike’s lawsuit is filed under Nike Inc. v StockX LLC, 22-cv-983 in the U.S. District Court of the Southern District of New York. The lawsuit accuses StockX of “freeriding, almost exclusively, on the back of Nike’s famous trademarks and associated goodwill.”
